Those who decide to set up a trust have many options to choose from, including special needs trusts, spendthrift trusts and many other types of trusts. In this post, we will take a closer look at Totten trusts and examine some of the benefits of these trusts.
Regardless of the estate planning decisions you make, it is imperative to recognize the different choices you have and make sure you pinpoint the right course of action for your loved ones.
The perks of a Totten trust
For starters, Totten trusts avoid probate, which is helpful for many families since the probate process is often complex. These trusts are created by grantors who deposit funds into financial accounts in their name as another’s trustee. These trusts are revocable and people can name individuals or entities as beneficiaries. Totten trusts generally involve assets held in bank accounts, but they cannot transfer real property. Generally, these trusts do not involve written documents, so they are very inexpensive to create.
For those who decide to create a Totten trust after comparing all of their options, it is imperative to name beneficiaries on the account. This is accomplished by using certain language such as “Payable on Death To” on the account’s title. It is also crucial to go over other relevant estate planning considerations and people often benefit from discussing their plans with family members. Our law firm knows that this option does not work well for many individuals as a result of their needs, in which case looking into other types of trusts is necessary. Review our website for more on creating a trust.