5 Reasons to Amend Your Trust
By establishing a living trust, you have already made a great step toward safeguarding your assets and protecting your loved ones. A living trust allows you to transfer many of your assets into the trust to be held during your lifetime. Your trust document will legally designate the beneficiaries of the property in the trust, and the successor trustee that you have named will administer those assets upon your death according to your wishes.
You should keep in mind that a living trust is only valid if it has been funded. For this to happen, you will need to transfer the ownership of your assets to the name of the trust. The following types of assets can be added to the trust:
- Checking and savings accounts
- Business interests
- Real estate property
- Motor vehicles
- Valuable personal property
- Investments such as stocks and mutual funds
However, it’s important to know that you can’t place some assets in a living trust. For example, retirement accounts and life insurance policies have their own beneficiary designations so don’t include them in the trust. You should just make sure to update those designations should you need to update the beneficiaries to your trust as well.
You can change a revocable trust at any time during your life. When should you amend it? Here are some of the top reasons that you might need to amend your trust.
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You Have a New Child
Any biological or adoptive children that you don’t include in your trust, may not receive their fair share of your property without involving the court. It is essential to add any new child to the trust if you want them to inherit specific assets from your estate. You may want to consider a “family pot trust.” This is a single trust that would provide for the basic needs of all children you have until the youngest reaches a certain age, commonly 21, at which point the remaining assets would be divided among all of your children.
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You Need a Different Trustee
When you first created your living trust, perhaps you chose a trustee who was a close friend or business partner at the time. Perhaps you’ve grown apart from this person and they no longer are the best option as a trustee. It’s a good idea to review your trust every few years to ensure that you have the right successor trustee in writing.
If you have any minor children, the trustee could be in charge of the trust for many years. Therefore, this person should be a responsible individual who you would trust to manage your assets properly should you die or become incapacitated. As you grow older, you should consider adding an alternate trustee from a younger generation, such as a child or grandchild, in case the primary trustee dies or becomes unfit to handle their duties.
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You’ve Accumulated More Assets
As you age, you will likely have more assets than when you first created your trust. If you don’t include these assets in the trust, however, the court would have to decide what happens to your property through the lengthy, and often expensive, probate process. Also, we recommend to amend your trust whenever you gain a new asset like an inheritance, investment, or real estate property. This will maximize the protection of your assets and help your loved ones avoid potential legal disputes. You should also alter your trust if you have assets to remove, like an old home or bank account.
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You Need to Add or Remove a Spouse
Did you establish a trust with your last partner and now that situation is different? If so, you need to review your document with a qualifying attorney. You’ll need to remove that ex-spouse will from the trust, or they could inherit the assets when you pass away. If you have remarried and you want to ensure that you protect your new spouse. Add them as a beneficiary. Not taking these steps would result in distribution of your assets in a way you wouldn’t want.
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You’ve Moved to a New State
When you move to a new state, the good news is that you won’t have to start over with a new estate plan, but you may need to revise your documents since each state has their own inheritance laws. You should review your living trust as well as the other important documents in your estate plan. To ensure their validity, you and your estate lawyer will need to ensure each document adheres to the specific laws of the new state.
Why Work With an Estate Attorney to Amend Your Trust?
While you can find DIY estate planning programs available, these are usually cookie-cutter templates that don’t account for your individual situation. When you work with an attorney, you will have ready access to someone who is already knowledgeable in estate planning and related processes. You’ll receive expert guidance in creating a plan that will best protect your interests and your senior family member’s.
At the Law Office of Kyle W Jones in Bakersfield, we work with each client personally to ensure that all of their needs are met. We perform a comprehensive estate evaluation and provide recommendations to help you leave behind as much as possible to your loved ones.
Contact Us Today
If you have experienced any of the above scenarios and you need to amend your living trust, the Law Office of Kyle W. Jones can guide you through the process step by step. We know how important it is to protect your family, so we will ensure all of your paperwork is in order and advise you on how you can enhance your estate plan. Contact our Bakersfield office today to set up a meeting with an experienced trust attorney.
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