Trust and Estate Planning

Estate planning involves naming people and organizations you want to receive the things you own after you die. This process involves careful financial planning and sometimes people choose to transfer their funds to trusts after they die.

Trusts are fiduciary relationships in which one party, who is known as the trustor, gives another party, the trustee, the right to hold title to property or assets. This arrangement is usually for the benefit of a third party, the beneficiary.

If you are interested in establishing a trust during the estate planning process, Alvarado Master Agency can help you get started. But before you call, here’s what you need to know about trusts and estate planning.

What Is Estate Planning?

The process of estate planning involves the preparation of tasks that will manage an individual’s assets in the event of their incapacitation or death. The planning process includes the settlement of estate taxes and the passing of assets to heirs. Usually, an attorney or financial professional aids in estate planning.

Why Establish A Trust?

Trusts allow you to be extremely specific about how, when, and to whom your assets are dispersed. Trusts can also be used to achieve a range of estate planning goals, such as charitable giving, tax reduction, and others. In some cases, establishing a trust can lead to significantly reduced estate taxes. To learn how, contact a finance professional.

How To Handle Estate Planning

When planning how your assets will be distributed after your death, you should follow these steps:

  1. Take inventory of your possessions
    • Even if you think you don’t have enough possessions to justify estate planning, it is important to start looking around to determine what valuable assets you own. When you understand what items will be passed to your heirs or trust, you can decide what should go where.
  2. Consider your family’s needs
    • Your family will be left without a source of income if you pass away. If you don’t have a precautionary measure like life insurance in place, your estate will be what’s left to help your family maintain a comfortable standard of living. You’ll also need to name a potential guardian for your children, in case you and the other parent are both dead or incapacitated.
  3. Establish directives
    • Through your estate plan, you can establish directions that can be followed if you are dead or incapacitated. A trust can be used to dictate how your assets should be managed. Medical care directives will spell out your wishes for medical care if you become unable to make decisions on your own. Financial power of attorney is an option that allows someone else to manage your financial affairs if you are capacitated. Using all of these directives, you can ensure that your wishes are followed, even if you die.

Start The Estate Planning Process

Whether you want to establish a trust or purchase life insurance, Alvarado Master Agency have solutions for you. We can help you plan your estate in a way that keeps your assets protected and properly allocated.

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