Full question:
What living trust should I use if I am separated, and have adult children?
- Category: Trusts
- Date:
- State: California
Answer:
A trust is a legal arrangement created during a person's lifetime that can also be established by a will after death. Once assets are placed in a trust, they belong to the trust, not the trustee, and are managed according to the trust document's instructions. The basic types of trusts are revocable and irrevocable.
A revocable living trust can be changed or canceled at any time by the person who created it, as long as they are competent. This type of trust allows the trustee to manage assets for your benefit during your life and designates beneficiaries to receive the assets after your death. The trustee has a fiduciary duty, meaning they must act in the best interest of the beneficiaries and cannot use trust assets for personal gain without permission.
Irrevocable trusts cannot be amended or revoked once established. These trusts often have tax benefits and may be used for specific purposes, like estate tax planning or Medicaid eligibility if a parent needs nursing home care.
A testamentary trust, created through a will, only takes effect after the individual's death and does not manage assets during their lifetime. It can provide for dependents, such as young children, who need someone to manage their assets posthumously.
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This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.