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With trusts, is a testamentary trust right for me?

For many New Jersey residents who are estate planning, a will in and of itself is not sufficient for their purposes. There are other instruments they would like to use as part of the comprehensive estate plan. A will determines what property will go to whom after the settlor's death. Some people want to have a trust too. There are types of trusts that will become effective at the time of the settlor's death. This is known as a testamentary trust.

A testamentary trust falls into the category of an express trust. It will be in the will or a document associated with the will. When the person dies, it goes into effect. This will have specifics as to what will be distributed after the person's death. With a testamentary trust, the assets can be shielded from the whims of people who might not yet have the capacity to handle them. This is done for their own protection and so the settlor can exert a certain level of control after death. Examples are minors or family members who were not deemed of sufficient maturity to oversee everything in the estate.

There are certain people who will be involved with a testamentary trust. They include: the person who created the trust - the settlor; the person who manages the trust and handles it - the trustee; whomever or whatever entity receives the benefits of the trust - the beneficiaries; and the court that presides over the estate - probate court.

When thinking about a trust as part of a will to protect assets and keep the beneficiaries from making mistakes, a person needs to understand the value of a testamentary trust. Discussing the benefits of it as well as other potential options is a wise first step and a legal professional who is experienced in trusts can help.

Source: estate.findlaw.com, "Placing a Testamentary Trust in a Will," accessed on Dec. 5, 2017

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