Estate planning is a very personalized process because you can choose from many options when deciding how to divide your assets or pass them onto your heirs. You also have options in the level of control you wish to exert over the inheritance you leave each heir. One of the best ways to ensure that everything goes as you planned after your death is to use trusts.
CNBC explains that a trust gives you the ultimate control over your assets. Plus, you can create a revocable trust that allows you to continue to adjust and change the terms of the trust over your lifetime. You can put limits on a trust. For example, you can set it up so that it pays your heir half of his or her inheritance upon your death and the other half when he or she reaches a certain age. This is nice when you have minor or young children who you are not sure will be able to handle the financial responsibility of the full inheritance.
A trust also enables you to protect your assets from creditors. When you die, your debt does not go with you. Your creditors can and will likely try to go after your estate to recoup the money you owe them. Assets outside of a trust are often fair game to creditors, and your heirs will have little ability to protect them. However, if you put your assets in a trust, creditors cannot touch them.
You can use a trust for almost any type of asset. You can also create almost any terms you would like for the trust. If you have concerns over protecting your assets while you are still alive, you can even create an irrevocable trust. With this type of trust, once you create it, you cannot change it without the approval and agreement of the heirs.