What are the trusts for an estate plan?

A trust is an important part of an estate plan in California. A trust is a legal relationship between a “grantor” (the person who creates the trust) and a “trustee” (the person appointed to manage the trust). The grantor transfers money or property to the trustee to hold for the benefit of another person or persons known as the “beneficiaries.” There are two basic types of trust: revocable and irrevocable. In a revocable trust, the grantor retains control of the trust assets and can modify or even revoke the trust. With an irrevocable trust, the grantor permanently transfers control of the assets to the trustee and the trust cannot be modified or terminated without permission from the beneficiaries. The primary purpose of a trust is to provide asset protection and/or tax savings. A revocable trust can be used to protect assets from creditors and lawsuits, while an irrevocable trust can be used to avoid or reduce estate tax liability upon the grantor’s death. Estate planning trusts are also used for other purposes such as asset management for minor children, special needs trust for individuals with disabilities, charitable trusts to benefit a charity, and trusts to provide for the care of a pet. In California, a trust is a powerful estate planning tool that is flexible and can be tailored to meet your specific needs and goals. With careful planning and the advice of an experienced trust and estate planning attorney, you can create an estate plan that will protect your assets and maximize the benefits to your loved ones.

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