subject: The Role Of A Trust In Disability Planning [print this page] One aspect of estate planning involves disability planning, which is creating a contingency plan in case of incapacitation in later years. A living trust is one estate planning tool that can often be put to good use within a disability plan.
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One aspect of estate planning involves disability planning, which is creating a contingency plan in case of incapacitation in later years. A living trust is one estate planning tool that can often be put to good use within a disability plan.
A living trust is a trust established during the lifetime of the grantor, the person establishing the trust. It is revocable, which allows a grantor to make changes while they are alive, but becomes irrevocable upon their passing. The grantor transfers most of their property into the living trust during their lifetime, and upon their death or incapacitation, a successor trustee takes over to manage the property for the benefit of the named beneficiaries.
The trust documents are a vehicle within a disability plan which allow you to leave instructions for a successor trustee as to your wishes for the management of assets. In addition, the trust allows the grantor to avoid a more intrusive court proceeding such as conservatorship to name someone to manage finances in later years.
Another concern of disability planning is putting a plan in place to decide who will take care of personal care decisions should you no longer be able to make those decisions on your own. A trust may also be used in that respect, as trust documents may specify that trust property may be used to help pay for the costs of your personal care should the need arise. In fact, the successor trustee may be instructed to honor the needs of your long term care over the needs of the named beneficiaries.
Disability planning is but one aspect of establishing a comprehensive estate plan. Working with a qualified estate planning attorney allows you to ensure that your family and personal needs are met later in life, as well as the burden of your passing eased on your loved ones
