Trust Attorney in Troy, Michigan
What is a Trust?
A Trust is a type of ownership where the control of the property is separated from the benefits of the property. In a Trust, the trustee controls the property, and the beneficiary gets the use of the property. Control and use are both rights that are associated with ownership, and the Trust splits these rights up.
In a typical Living Trust, a property owner makes herself both the initial trustee and the initial beneficiary of the Trust property. She retains all the ownership rights as long as she has both of those roles. She also names a successor trustee and successor beneficiary, so that when she dies, the Trust ownership is split between the successor trustee and the successor beneficiary.
If our Settlor (the trust creator) becomes incapacitated, she would still be the beneficiary, but her successor Trustee would step in to control and manage the Trust property.
How is a Trust Used?
The split ownership of Trust property lets us automatically empower a new trustee to take over control of the assets when the initial trustee dies or becomes incapacitated. That means that we don't need a Probate Court's order empowering a Personal Representative or Conservator, because the successor is already in place by virtue of the Trust's ownership of the assets.
Parents of young children can use the split ownership of Trust property to ensure that their beneficiaries do not waste their inheritance on imprudent investments or poor spending habits. The trustee manages the investments and distributes funds for the kids' support until certain ages or other milestones are attained.
Managing Assets Over Time
In a blended family, Trust ownership might be used to provide an income and other support to a surviving spouse who is not the mother or father of the Settlor's children. For example, life insurance proceeds might be paid to a successor trustee to hold and use for the support of the spouse. But when the spouse later dies, the Settlor's children step in as beneficiaries. Over time, the beneficiaries change, but control remains in the hands of the trustee. This could be preferable to leaving the insurance directly to the spouse and hoping that he or she leaves it to the kids.
In Michigan, we have a domestic asset protection trust statute. This can allow a Settlor to transfer property irrevocably to a trustee to hold and invest. The Settlor can be a beneficiary of that Trust, but, with some exceptions, creditors of the Settlor cannot reach the Trust assets.
Hire an Experienced Estate Planning Attorney in Oakland County, Michigan
If you're not sure where to start with the estate planning process, consider contacting Lex Novus.
For years, residents in Oakland County, and across Michigan have turned to our attorneys for their estate planning needs. They have years of experience creating wills, trusts and other documents for individuals who want to protect their families from a public and often unnecessary probate process. Turn to Lex Novus, and you can use a will or trust to:
- Direct who will have guardianship of your minor children
- Select someone as your personal representative and trustee
- Control who receives property, money and other assets
- Identify who will take over ownership of your business
If you're searching for a trust lawyer in or around Oakland County, Michigan, reach out to Lex Novus to schedule a consultation with our office today.