If you’ve never heard of a family trust, it’s something you might want to learn about sooner rather than later. A family trust is a great way to help the members of your family in the future and leave them something to help out when the time comes. Basically, a family trust is a situation in which you, as the settlor, still have some control over your assets while they are progressively transferred more and more fully to your family members. You can have a family trust set up while you’re still living or you may add one to your will to take place when you are no longer living instead. With a family trust, your family members will be able to take ownership of your home and property eventually. There are several other benefits to setting up a family trust, listed below.
Peace of Mind for Your Family
This is usually the first benefit people think of when considering setting up a family trust. When your assets are transferred over time to your family members, they can rest assured knowing they won’t have to worry as much about money or property issues later on in life. This can also help make you feel better about what will happen to your property and funds after your death as well. Knowing that all of your assets will go to your family may make you feel more at ease too.
Protections from Claims by Collectors
Bill collectors, ex-spouses and others may try to collect payments from your assets. However, if your funds and property are a part of a family trust, this will take precedence over any other claims. This means that no one will be able to reach your funds or your property who you don’t want to. You will eventually reach “personal poverty” and become a beneficiary of the family trust while your family members become the legal owners of your assets instead.
When you set up a family trust, this paperwork is not filed publicly. In this way, you can confidentially take care of your assets without having to let anyone in on the situation unless you choose to. Only the lawyer in charge of your paperwork, you, and the appropriate family members will know about the family trust. This is a great option if you want to involve some members of your family but not others, or if you’re trying to protect your assets from ex-spouses or other relatives who may try to lay claim to them.
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