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Trust Administration Tips: Benefits of Setting Up a Trust

A trust fund is a significant part of your estate plan when you want to give money to your minor kids. It ensures that your money managed by a trustee, is set aside and made available to to them when they reach a certain age. Usually, setting up and managing trust funds are time consuming and complex. It can also cost a significant amount of money, so you should have a good reason to want to set up a trust fund.

The following are some benefits of and purposes for using trusts:

Irrevocable life insurance trust is one common tax-saving trusts. After your death, all income from your life insurance policy is added back into your estate, which often turns an estate that is not subject to federal taxes into an estate that’s required to write a check to the office of the IRS.

But an irrevocable life insurance trust shields life insurance death benefit revenue from the estate taxes. After you have set up a trust fund, you still have life insurance, and the beneficiary or beneficiaries still get the proceeds from your insurance policy upon your death. But this time, estate taxes may not be a problem.

By keeping your properties out of your probate estate, you can avoid many of the issues on lack of privacy, costs, and hassles about probate.

PROTECTING YOUR ESTATE (and the estate of the recipient or recipients:
One of the main purposes of trust is to safeguard your estate even after it becomes part of someone else’s estate.

For example, you are planning to leave a huge sum of money to your only child, but you’re concerned that before you can say, get married before you turn 25 he or she will have spent the money.

In such case, you could use a trust fund to parcel out the money to him or her as you see fit. The trust fund can give him or her a a certain amount each year for duration; and then a final lump at a certain age when you think she will be mature enough to protect the money as if she had actually earned it herself.

You have the option to add conditions on how the amount in the trust fund is dispersed, such as your child gets a part of the money when she graduates from college and lands on a good job, for example, or when she meets some criteria you’ve established when you set up the trust.

A trust fund could make money available to your children and grandchildren, relatives, even to non-relatives, such as employees and/or friends, for educational purposes, like living expenses and college tuition.

You could donate money to charitable organisations by setting up some type of charitable trust fund that may, for example, yearly give a certain amount of money to the charity institution while you’re still alive and give a larger sum of money upon your death.

If you need certified trust administration services Perth, visit Estate Administration Services by clicking on the the provided link.

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