What Is a Family Trust?

January 3, 2024
A Media Estate Lawyer at Eckell Sparks Can Get Your Family Trust in Order

A family trust is a powerful, versatile estate planning document for financial security, asset management, and legacy planning. It allows people to safeguard their wealth, distribute it according to their wishes, and structure it appropriately for tax purposes.

An individual sets up a family trust to control the dispersion of their assets. At the same time, they are alive, should they become incapacitated, and after they pass away. The parties involved include:

  • The grantor or settlor who establishes the trust.
  • A trustee who administers it and carries out the grantor’s terms.
  • A beneficiary who gets financial benefits from the trust.

Each category above can include more than one person; trustees can be financial institutions like banks, and beneficiaries can be charities. Beneficiaries are typically family members, however. It is recommended to name successor trustees and review the terms of the trust every few years.

What Are the Benefits of a Family Trust?

Having a family trust in an estate plan offers many benefits. Trusts do not usually have to go through probate as with wills. Instead of having to wait, your beneficiaries can have the assets transferred in a timelier manner. Since there is no probate, information about the inheritance remains private.

A family trust is more flexible because you can decide which beneficiaries get what and when. If you have family members with special needs, the trust can also ensure they retain their government benefits after receiving the inheritance. Revocable trusts let grantors change beneficiaries and add or remove assets as well.

How Can I Set Up a Family Trust?

A lawyer can set up family trusts. There are various trust options, so you must compare them to see what is best. Lawyers can serve as trustees, but you might prefer to ask a family member or take responsibility yourself.  Next, you must decide who the beneficiaries will be and what benefits they will get.

A Media Estate Lawyer at Eckell Sparks Can Get Your Family Trust in Order

Estate planning can seem overwhelming, but a knowledgeable Media estate lawyer at Eckell, Sparks, Levy, Auerbach, Monte, Sloane, Matthews & Auslander, P.C. can explain everything and organize your family trust. For more information, call 610-565-3701 or complete our online form to schedule a consultation. We are located in Media and West Chester, Pennsylvania, and we serve clients in Delaware County, Chester County, and Montgomery County.