Are Trusts Only For the Wealthy?

May 18, 2015

A common misconception holds that living trusts are only for the very rich. The belief may stem from history; in the 16th century Britain kings often controlled their lords’ power by seizing and distributing their lands as they died; the structure of a trust allowed circumvention by deeding property to the church, with the understanding it would later revert to the proper heirs. shutterstock_235005190

By measure of the 2010 Survey Of Consumer Finances only 1.3% of Americans have received monies through a trust.

Yet, the median amount is a moderate $285,000, and with as little as $100,000 the benefits can be significant:

  1. The lengthy and slow probate process can subject funds to fees and charges amounting to between 2% and 4% of total estate value.
  2. A trust avoids probate as it is private; as a distinct separate legal entity, distributions occur without court involvement.
  3. Appointment of a trustee ensures that future decisions can be placed in effect long after the trust is created.
  4. A trust fully utilizes each person’s Unified Credit or the State estate tax exemption. Mandated by Congress, it will shelter, per person, just over $5 million or $675k(in NJ), whichever amount is preferable. But, the trust should be structured with “A-B Provisions”, the death of one spouse separates the trust into two parts thus enabling the shelter from estate tax.

It is important to note that as total funds increase beyond that amount, estate taxes of up to 35% take effect. Living trusts are easy to set up, low-maintenance, and keep finances out of the public eye even after death. Consultation with an attorney specializing in estate planning can insure that your assets are protected; start a conversation with us today at info@lawesq.net.


Practice Areas:



Schedule your free Exploratory phone call

Click here to see how we
can be of assistance.

Payment Portal
for Tax and Accounting invoice

This link offers a secure, quick way to complete your payment with Omni360 Advisors LLC.

Our Social Media

Connect with us on Social Media using the following buttons:

Visit our Podcasts

Listen in, Join the Conversation!

Recent Posts

Top 5 Things Employers Should Know About Their 401(k) and Employer-Sponsored Retirement Plans

Discover the top five things business owners should understand about managing a 401(k) or employer-sponsored retirement plan, including fiduciary responsibility, fees, compliance, and employee engagement. ...

<p>The post Top 5 Things Employers Should Know About Their 401(k) and Employer-Sponsored Retirement Plans first appeared on Integrated Tax Planning, Legal Planning & Financial Planning.</p>

Health Care: The Hidden Retirement Cost You Can’t Afford to Ignore

Health care is one of the most significant and often underestimated retirement expenses. Explore Medicare, long-term care, and tax planning considerations for affluent families. When most people think about retirement planning, they focus on investment ...

<p>The post Health Care: The Hidden Retirement Cost You Can’t Afford to Ignore first appeared on Integrated Tax Planning, Legal Planning & Financial Planning.</p>

The Risks of Concentrated Stock: Evaluating Single-Stock Exposure

A concentrated stock position can significantly impact portfolio risk and tax planning. Explore considerations for executives, founders, and business owners managing single-stock exposure. Success often creates complexity. For business owners, executives, ...

<p>The post The Risks of Concentrated Stock: Evaluating Single-Stock Exposure first appeared on Integrated Tax Planning, Legal Planning & Financial Planning.</p>