With many marriages in New York and other states ending in divorce, it is only natural for parents to want to protect their children's inheritances from being subject to property division in a divorce settlement. Some parents find that establishing trusts is the most appropriate way to do this. Including a trust in estate planning can provide peace of mind to a parent who wants his or her child to have something on which to fall back if the marriage should end.
People in New York who want to get their affairs in order by establishing estate plans might have questions about the available options. What is the purpose of creating trusts, and what are the differences between living and revocable trusts? Is an irrevocable trust perhaps the suitable option? Setting up a trust is a way of protecting assets, and appointing a trustee to manage them after the owner's death or incapacitation.
Pets have become loved ones of many New York families, and making sure they will continue to receive loving care if their owners should die or become incapacitated is something that can form part of estate planning. Trusts can be set up for dogs, cats, hamsters, birds, lizards, snakes, turtles and other pets -- not to forget a beloved horse or pony. A pet trust can ensure that funds are available for routine and emergency veterinary care, boarding, feeding, grooming costs and more.
New York parents may have concerns about children with special needs who might outlive them. Naming a disabled child as a beneficiary in a will may not be the best option because it could jeopardize that person's eligibility for government support programs. Medicaid, Supplemental Security Income and other government programs like subsidized housing and job training typically have restrictions on the income of disabled individuals. However, parents can establish special needs trusts by which they can earmark assets to provide support before and after their deaths.
New York residents who have invested in Bitcoin or other cryptocurrencies might have questions about how best to treat these assets in their estate plans. Bequeathing digital holdings is significantly more complicated than other property or cash. However, one thing that seems clear is that, when it comes to choosing to do it via wills or trusts, trusts might be the wiser choice.
Most people tend to avoid thoughts about their own mortality. However, New York parents of young children should consider the possibility that an accident or illness might claim their lives before their children reach adulthood. Such thoughts might bring up many questions about wills, trusts and investment accounts, and the pros and cons of each option.
Following the recent death of actor Burt Reynolds, it was revealed that, although he left a will that was established in 2011, he excluded his son from it. However, this was reportedly intentional, as Reynolds chose to provide for his son in a trust. People in New York might question the reason why some choose to provide for surviving loved ones in trusts rather than wills.
While many New York residents fail to establish estate plans, those who do often make unintentional mistakes. Drafting a will and creating trusts are best done with the guidance of experienced legal counsel. One of the biggest mistakes is neglecting to review estate plans at regular intervals to ensure life events, such as deaths, births, marriages and divorces, are reflected and that the necessary modifications are made to keep it current.
New York residents who have established estate plans might find comfort knowing that their living trusts are in place to manage their estates while they are alive and after they die. However, with passing time comes life's changes and events, some of which might affect a living trust. For this reason, occasional reviews of trusts are crucial.
Estate planning is a subject many New York residents like to avoid -- not realizing that taking care of it sooner rather than later can provide peace of mind to parents and their children. However, professional guidance is necessary to explain the different aspects. Estate planning is not only about trusts and wills. One should combine those instruments with powers of attorney for coverage in the event of the person becoming incapacitated.