Why a Trust Is a Great Estate-Planning Tool — Even if You’re Not Rich

An essential element of estate planning for professionals is to avoid probate and taxes for their clients. These problems and others can be avoided by setting up a trust. Though the perception is that trusts are only tools for the wealthy, Daniel Routh, a certified financial planner with Exencial Wealth Advisors in Oklahoma City, advises that “The reality is a trust can be a fantastic tool for the average person or couple because it simplifies things in the event of your death.” 

There are numerous types of trusts, but the most common is a revocable living trust. This type allows the person that sets up the trust – the grantor – to specify exactly how their estate will be distributed to their beneficiaries when they die, avoiding probate and all the drama that can be associated with it. This can also extend control for the client into the afterlife without including conditions within their will.

Though there are other tools than can be beneficial in avoiding the legal process of determining that a will is valid, these can be limited in the amount of assets they provide for. A trust, in many cases, “pays for itself multiple times over,” says Stash Graham is managing director of the Graham Capital Wealth Management in Washington, D.C. The fees associated with setting up a trust can also include a new will, medical derivatives, a power of attorney and the processing, Routh says.

See Sarah Max, Why a Trust Is a Great Estate-Planning Tool — Even if You’re Not Rich, Barron’s, February 23, 2019.

Special thanks to Joel C. Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.