Significant Trust Benefits

If keeping the details of your assets, family or heirs private is important, establishing a trust is critical. In addition to keeping your information confidential, transferring of assets via a trust generally reduces or eliminates estate taxes.

In most instances, assets transferred to a trust are no longer considered part of a grantor's property and as a result, cannot be seized by creditors.

A trust aids in protecting a financial legacy by retaining accumulated wealth as one fund that can continue to grow. Provisions are set to provide payments to family members as needs arise.

A correctly structured and administered trust will include well-designed planning for taxes – income, capital gains and estate. Tax planning includes legitimate avoidance or deferral of taxes in order to maximize the transfer of wealth and the protection of legacy.

Probate can add time delays, expenses, and unwanted publicity. Establishing a trust can avoid probate because the death of the trust grantor will not affect trust property, which continues to be held and managed in confidence by the trustee.

A trust is a flexible tool that can be used to establish a variety of financial arrangements. Providing a source of income, but not capital, for heirs or making a provision for the education of children, while not allowing access to capital until later in life, are only a few examples of the many detailed situations you can specify in your trust.

A trust can be especially helpful as a way to provide for the needs of young children, the elderly, disabled persons, or those suffering from a debilitating illness. A special needs trust requires special oversight to ensure the trust beneficiary maintains access to Social Security Insurance, Medicare, Medicaid, and other available government services and assistance.

Trusts can be used to prevent the sale of a family company or business and to ensure an owner's wishes are observed after their death. Additionally, special provisions can be set to ensure the company stays in operation, or if in the event liquidation is necessary, requirements can be established to manage the sale of ownership according to the late individual’s wishes.

A discretionary trust provides flexibility to adapt as circumstances may change, such as giving the trustee discretionary power to decide when to distribute trust assets to beneficiaries. Because beneficiaries have only a contingent interest in the trust, they can avoid tax liability until distributions are made.

Advantages of a Trust over Probate

Probate ensures debts are paid, attorneys and other necessary professionals are approved, clear title to property is established, and remaining assets are distributed to heirs according to a will or applicable law if no will is present.

While this may sound like a simple approach, the problems with probate are threefold: it's a long process, it's expensive, and it's public. Here's one unsavory description: "Probate is a lawsuit you file against yourself and your family in favor of the rest of the world."

Establishing one or more trusts and transferring assets to those trusts often allows you to avoid probate entirely. Once designated assets are transferred to trust, they live there past your death— because trusts do not "die"—and the trust terms instruct Dunham Trust what to do with the assets. As a result, you don't need a public record made in a court room to assure that assets will be handled as you wish.

During your life you typically maintain control, but upon death, the trust provides for the transfer of all assets according to the instructions you've established. If privacy is important to your family, a trust can be an especially critical component of your financial plan.