Many people are starting to see the benefits of making a family trust in Auckland, a service offered by firms such as Accounting North Ltd. Still, some do not fully understand what it is. So what is a family trust? It is a legal document that covers the distribution or dispersion of an individual’s assets after death.
The one who makes the trust is the “grantor.” The grantor transfers his assets to the “trust” and not specific individuals as in wills. The grantor appoints a “trustee” to carry out the terms of the family trust after the former has passed on. The grantor can change the conditions of a family trust anytime.
So how do you decide if you want a will or a family trust? Here are some considerations.
You Can Use It as an Estate-Planning Tool
You do not have to have a long list of real estate properties or businesses to make a family trust. It is not something that is limited to the rich and famous. Anyone can make a family trust if he or she wishes an efficient and sure way to distribute his or her wealth after he or she has passed.
A Family Trust Does Not Go Through Probate
Probate is a legal process where a will of a deceased individual needs to be proving and registered in the Supreme Court. A family trust does not need to go through this process, which makes the distribution of wealth and assets faster and easier.
A Family Trust Sets up Health Power of Attorney
One of the benefits of creating a family trust is having the health powers of attorney. This means that in case that the grantor suffers incapacity, the trust appoints someone who can make the medical decisions in case you cannot do it on your own. You also decide who this person will be.
While anyone can make a family trust, many people choose this option if they have a considerable list of wealth and assets to distribute. Many still prefer a will because it is upfront, the lesser expensive route. But if you think you will have more control over your assets through a family trust, take this route instead.