Benefits of family trusts include avoiding the probate process, protection from legal challenges and avoiding a conservatorship, says Nolo. The different types of trusts a person can set up include revocable trusts, irrevocable trusts, asset protection trusts, charitable trusts and constructive trusts.Continue Reading
Probate is a legal process that is usually time consuming and expensive, according to Nolo. It's done in order to prove that a deceased individual's will is valid and to take care of any debts or taxes left by the deceased. In the event of a lawsuit, it's usually easier to attack a will than it is a trust. The reason for this is that a person has an ongoing involvement with a trust after it's been created, which is valid evidence that the person had the mental awareness to properly manage his affairs.
Family trusts are also beneficial in the event that the trust maker is ever mentally or physically incapable of handling his estate, says Nolo. If the trust is made with a spouse, the spouse can oversee any property listed in the trust. With an individual trust, the trust maker can list a successor trustee to manage the trust when the trust maker dies. Avoiding conservatorship can save a family an abundance of time and money on court costs and legal fees.Learn more about Financial Planning