Trust agreements are now commonly included in the average person’s estate plan, predominantly because of the variety of estate planning goals that can be accomplished with a trust agreement. If you have never created a trust agreement before you likely have a number of questions and concerns about including one in your estate plan. For example, you may be wondering “ what assets are left outside my trust? ”
The simple answer to that question is that the assets left outside of your trust agreement are decided by you. When you create a trust agreement you decide which assets to use to fund the trust. Almost any type of assets can be used to fund a trust agreement, including cash, life insurance proceeds, securities, real property, even collectibles and other personal property. You may decide to transfer all your assets into a trust agreement or only a select few assets. Which assets you use will largely be decided by the purpose of the trust.
For example, if the purpose of your trust agreement is incapacity planning you will likely want to transfer all major assets that you wish your spouse (or other successor trustee) to have control over should you become incapacitated at some point in the future. When used as an incapacity planning tool a trust allows you to name another person as a successor trustee who then automatically takes over the control and management of trust assets upon your incapacity.
If the purpose of your trust is Medicaid planning you will likely want to transfer all “countable assets” into the trust as these are the assets that could prevent you from qualifying for Medicaid benefits when you need them.
On the other hand, if the purpose of the trust agreement is simply to provide educational funding for a child or grandchild you will only want to transfer enough funds, or enough assets, into the trust to accomplish the goal of funding the beneficiary’s education.
The bottom line is that you and your estate planning attorney will sit down and decide which assets will be transferred into your trust agreement and which assets will remain outside the trust based on your individual estate planning goals and objectives.
If you have additional questions or concerns relating to trust agreements or estate planning in general, please be sure to contact the experienced Missouri estate planning attorneys at Amen, Gantner & Capriano, Your Estate Matters, LLC by calling (314) 966-8077 to schedule an appointment.