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Trusts 101: Estate Planning With Trusts

estate planning trusts Apr 12, 2017

In today's video, I'm going to go over a little bit about trusts with you. I call this Trusts 101. The reason I'm doing this is because I know there's a lot of confusion about the types of trusts that are out there. I'm not going to get into real specifics about trusts, but I'm just going to give you this overview. So let's get started.

~Attorney Nicole Wipp

In this video we'll cover:

  • What a trust is
  • The two main types of trusts
  • The two categories of living trusts and the different goals that each can accomplish
  • What is meant by 'Funding' your trust

This is just a really quick Trusts 101. It's important to understand these concepts so that you make good legal decisions in the future.

Have Questions Or NEED Help?

Call us today! (248) 278-1511

Prefer to read this information? Below is the video transcript.

Hi everybody, attorney Nicole Wipp here with the Family & Aging Law Center. Today I'm going to go over a little bit with you about trusts. I call this Trusts 101....

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The Biggest Threat to Your Estate Plan:  It’s What You DON'T Know

Let’s Face It: You Don’t Know What You Don’t Know

 

When it comes to estate planning, the real problem is simple:  you think you know.  The internet, friends, neighbors – even the government shapes what we think we know when it comes to estate planning and asset protection. 

 

The reality is, though, that what I’m about to tell you is something that most attorneys don’t know – not even traditional estate planning attorneys.  Yes, it’s true. 

 

Long-Term Care is One of the Biggest Unresolved Issues in Estate Planning -That being said, long term care planning isn’t just about long term care insurance!

The need for long-term care is also one of the biggest threats to your lifetime financial security.  The statistics show us that a full one –third of all persons over 65 will have a need for long-term care, and a full one in ten will need long-term care for five or more...

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Irrevocable Pure Grantor Trusts (Part 2)

Irrevocable Pure Grantor Trusts With David Zumpano (Part 2)

Irrevocable trusts, traditionally, are estate tax planning devices. Very few Americans need estate tax planning, however – less than 2%. Why, then, would you want an irrevocable trust?

This two part series, including part one, focuses on a new type of irrevocable trust known as the irrevocable pure grantor trust.

Let's Continue...

Irrevocable pure grantor trusts are mainly used to protect assets from creditors and predators, and can be an excellent pre-planning tool for elder law attorneys and their clients.  Understanding what they are, and how they differ, from traditional irrevocable trusts is essential.

In this episode, David Zumpano, a nationally recognized expert on asset protection and elder law planning (also a CPA & attorney) discusses this irrevocable trust, who it is for, and why you may want one.

Learn how this type of trust is one of the best ways to truly keep your money “safe.”

...

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Irrevocable Pure Grantor Trusts

Irrevocable Pure Grantor Trusts With David Zumpano (Part 1)

What is an irrevocable pure grantor trust, and why would someone want one? In this episode, David Zumpano, a nationally recognized expert on asset protection, estate planning & elder law, discusses with our attorney Nicole Wipp, this little known (although widely used) trust – what it is, why we use it, and who it is for.

In Part One You Will Learn:

  • about the goal of helping a loved one to protect their autonomy
  • why people end up in nursing homes (how failing to plan makes this more likely)
  • why retirement isn’t necessarily what you think it is
  • why we want to engage in an asset protection strategy for financial security in our later years
  • what is an irrevocable pure grantor trust, and how it differs from tax trusts and revocable living trusts
  • the history of trusts and what they were traditionally used for (tax trusts – the “traditional” irrevocable trust – no access, no control, no...
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Revocable Living Trusts (Part 1) With Nicole Wipp

Revocable Living Trusts (Part 1) With Nicole Wipp

How Do Revocable Living Trusts Work?

In this episode, host Nicole Wipp discusses what a “RLT” is and the importance of “funding your trust” – a commonly missed step.

You will learn:

  • What the primary purposes of revocable living trusts are
  • What a revocable living trust does NOT do for you
  • Common misunderstandings as to how this trust works
  • What trust funding is and why it is critically important

This is Part 1 of a two-part series on Revocable Living Trusts. To listen to Part 2, click here.

 

Be a SMART PLANNER!

Contact Us Today at (248) 278-1511. We Can Help.

The information in this podcast is not intended to be, nor should it be, construed as legal advice. It is for informational purposes only. For advice, specific to your situation, consult with a qualified attorney.

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Medicaid Planning - The Facts

MEDICAID PLANNING

The Facts...

Assets in a Revocable Living Trust are not protected and must be used to pay for the costs of long term care.

If you are married, your home is exempt and cannot be taken when applying for Medicaid.  If you are single or widowed, your home is exempt up to $552,000 (2015). If you transfer your home to your children, not only will it result in immediate ineligibility for Medicaid, but it could also:

  • Trigger a gift tax,
  • Result in the loss of your homestead tax exemption, and,
  • Result in your child’s spouse (the in-laws) inheriting your home. 

Giving your assets away means losing control. It’s not safe even if you “trust” who you give it to. If that person divorces, goes bankrupt or is sued, all of the money you transferred is at risk. There are asset protection trusts that permit you to keep 100% control of your assets without the risk of losing them if long-term care is needed.

You do not have to wait 60 months to...

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Irrevocable Trusts - The Facts

IRREVOCABLE TRUSTS...

The Facts...

A trust is a contract between the Grantor (the person who creates the trust), the Trustee (one who controls the trust) and the beneficiaries (those entitled to benefit from the trust). You, as Grantor, determine how the trust will be operated by the Trustee and who benefits, how and when.

While a Revocable Living Trust permits you to maintain full control (as Trustee) and have access to all your assets (as beneficiary), an Irrevocable Trust, once created, may prohibit your right to control the trust (as Trustee) or have access to your assets, but you get to decide to what extent.

It is a common misconception that irrevocable trusts, once created, cannot be changed. While that is true of many irrevocable trusts created to avoid taxes (tax reduction or avoidance trusts), it is not true of all irrevocable trusts. An irrevocable trust is a trust you create for the benefit of yourself or others and once created, you, as Grantor, must give up your right...

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What Should I Do to Plan For Long-Term Care? - Part 2

What Should I Do to Plan For Long-Term Care? - See Part 1

A properly drafted “income-only” trust that gives a Trustee no discretion to distribute principal to the Grantor-Beneficiary, or to his or her spouse, is still a viable long-term care planning tool.

 

Therefore, a senior doing estate planning may keep the income from an irrevocable, “income only” trust for himself or herself, with the remainder distributable to specific beneficiaries, and qualify for Medicaid (once the applicable “penalty period” has expired) without the assets in the trust being considered by the Department of Human Services as available to pay for the cost of long-term care.

If the home is the only asset to protect, a deed which transfers the property upon death to your trust or your children, will protect the property and the right to Medicaid.  Consideration must also be given to the fact that if the property is sold and the grantor is in the...

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What Should I Do to Plan For Long-Term Care? - Part 1

What can be done to plan for long-term care, ensure that a health crisis or chronic illness will not erode an individual's security and dignity, and provide for family and loved ones?

As you may have already gathered, the answer is not simple. A careful analysis of each individual's personal and financial situation must be done to formulate the proper plan. Factors such as income from social security, pensions and investments; the nature and value of assets; age and health; family situation; and other considerations must be evaluated in order to make the right choices.

 

If long-term care insurance is not an option, and personal income and resources are not sufficient, one planning technique is to transfer assets into an “Asset Protection” Trust, retaining the income for the “Grantor” and preserving the principal of the assets (the assets held by the Trustee) for spouses, children or other beneficiaries. When properly drafted, the trust will provide ...

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Wills and Trusts - What You Think You Know (But Probably Don't)

This article regarding wills and trusts by Michigan lawyer Nicole Wipp and the Family & Aging Law Center PLLC is not, and should not be construed as, legal advice. It is for general informational purposes only. To better understand how this legal concept can be applied to you, consult with an attorney.

Clients often come to me with ideas about wills and trusts that they learned from friends, neighbors, and the internet.  I’ve come to realize that a lot of people think they know about wills & trusts - but they don’t

Unfortunately, most people don’t ever find out they don’t know, because by the time it comes to light, it’s simply too late.  Here are some frequently misunderstood facts about wills and trusts:

Wills: Your Ticket Into Probate Court

Listen and Learn! Nicole's Podcast Episode About Wills (click the orange arrow to listen):

 

  • A will is, essentially, your ticket into probate court. Many people think that if they...
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