Kathryn T. Joseph & Associates, Inc.

trusts Archives

Making beneficiary designations

Some assets, including 401(k)s and IRAs, are passed down not by wills or trusts but by beneficiary designations. However, since these may be filled out in a flurry of employment paperwork, beneficiary choices might not be made carefully. A person might also forget about the beneficiary choices. This could lead to problems later if an ex-spouse remains on the paperwork or a child is excluded. People in Ohio should take certain criteria into account when making beneficiary designations.

The use of charitable trusts in estate planning

Ohio residents might like to know how to use charitable trusts as part of an estate plan. Assets in a split interest charitable trust are divided between one or more charities and a non-charitable beneficiary or beneficiaries. There are two types of charitable split interest trusts.

Using trusts for IRAs

IRAs can be bequeathed to heirs who can use the minimum distributions as they wish. However, IRA account holders in Ohio may want to use a trust as a tool to safeguard assets from beneficiaries who may have financial or behavioral issues. According to one financial advisor, a trust should be used by anyone with a sizable IRA if there are doubts about how the heir would handle the money.

Things to review in an estate plan

Ohio residents who have an estate plan should review the documents regularly. In going over a will or a trust, they should take into account whether changes in tax law might affect the estate plan. Changes in assets or in the family could mean a change is needed as well. People should also consider whether their choices for executor and trustees are still appropriate.

How a second marriage might change an estate plan

People in Ohio who are remarrying might want to consider how they should alter their estate plans. If it is not a first marriage for the new spouse, the first step should be to avoid entangling finances if the new spouse also has financial ties to a previous partner. Because creditors are bound by divorce agreements, commingling finances could jeopardize joint accounts.

Reasons to choose a trust over a will

Ohio residents may be able to meet their estate planning needs with just a will. However, it may be appropriate to include a trust in an estate plan because of the benefits that it may offer. For instance, those who have special needs children or grandchildren may use a trust to preserve assets while also retaining their eligibility for government benefits.

How trusts may be used

There are a number of reasons that Ohio residents might want to use trusts as a component of their estate plan. In addition to avoiding probate, which is not private and can be expensive, trusts allow assets to be managed in a variety of ways both while the settlors are alive and after their death. For example, there are certain types of trusts that can protect assets from creditors. A trust might also be used to manage people's financial affairs if they do not want to actively do so.

Using trusts in an estate plan

Some people in Ohio might wonder whether a trust would be a useful part of their estate plan. A revocable living trust is one of the more commonly used trusts. It is created during a person's lifetime and allows a person to make changes to the trust.

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Kathryn T. Joseph & Associates, Inc.
Executive Commons West
29425 Chagrin Blvd.
Suite 305
Cleveland, OH 44122

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Phone: 216-245-0504
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