One of the greatest things about estate planning is how it can constantly evolve to meet your needs. For example, you can start with a will and financial power of attorney in your 20s and then add or remove components at each milestone (marriage, children, etc.).
The possibilities are endless and worthy of exploration. If you already have an estate plan but wish to add trusts for the benefit of your grandchildren, you have several options at your disposal.
These trusts have significant tax benefits when created to benefit any heirs that are two or more generations apart from you. They are ideal for passing assets to your grandchildren without worrying about potentially harsh taxes.
Irrevocable life insurance trusts
These trusts are funded with your life insurance policy and can help your heirs avoid some estate taxes. Since they are irrevocable, they may not be altered once executed, ensuring that no one can take funds away from your grandchildren.
Credit shelter trusts
Typically created after your spouse dies, these trusts hold your estate apart from your deceased spouse’s estate. The trust can benefit you financially through the rest of your life. Any assets remaining in the trust can pass to your grandchildren (or others) after your death. Generally, these trusts do not impose tax burdens on your beneficiaries.
To reiterate, you have many options that can benefit your grandchildren, other relatives and yourself. Start your search for the ideal solution by learning about Florida trust and estate laws. Arming yourself with up-to-date information ensures you are ready to discuss your options with a legal advocate experienced in estate planning.