When planning for the future, many people assume that a will is all they need to ensure their assets are passed on according to their wishes. While a will is a critical part of any estate plan, it may not be enough – especially for families with unique needs or complex financial situations.
At Ritigstein Law, attorney Michael D. Ritigstein helps New Jersey families take a more comprehensive approach to estate planning. With decades of experience, he works closely with clients to develop strategies that reflect their goals, protect their loved ones, and avoid unnecessary complications down the line.
For many modern families in New Jersey, trusts offer added flexibility, control, and peace of mind. Whether you're part of a blended family, caring for a loved one with a disability, or looking to protect assets for future generations, trusts can help you achieve your estate planning goals more effectively.
What Is a Trust?
A trust is a legal arrangement where one person (the grantor) places assets under the care of a trustee, who manages those assets for the benefit of chosen beneficiaries. Unlike a will, which only takes effect after your death, many trusts can be used during your lifetime – offering greater control, privacy, and protection.
Common Types of Trusts:
- Revocable Trusts: Can be changed or revoked at any time. These offer flexibility and help avoid probate.
- Irrevocable Trusts: Cannot be altered once created but provide strong protection from creditors and estate taxes.
- Special Needs Trusts: Designed to support individuals with disabilities without affecting eligibility for government benefits.
Choosing the right type of trust depends on your specific goals and family dynamics. A knowledgeable estate planning attorney can help you decide what best fits your situation.
Why a Will May Not Be Enough
Wills are important for naming guardians, appointing an executor, and outlining how you want your property distributed. However, there are key limitations:
- Probate Delays: Wills must go through probate – a public, court-supervised process that can be time-consuming and expensive.
- Lack of Privacy: Probate records are public, meaning the details of your estate may become available to anyone.
- Limited Asset Protection: A will does not shield your assets from creditors, lawsuits, or other financial risks.
Trusts, on the other hand, can help your loved ones avoid probate, maintain privacy, and protect what you’ve worked hard to build.
Trusts for Blended Families
Blended families often face unique estate planning challenges. You may want to provide for a current spouse while also ensuring children from a previous relationship are not overlooked.
Trusts offer solutions like:
- Separate Trusts: Each spouse can create their own trust to direct how their assets are handled.
- QTIP Trusts (Qualified Terminable Interest Property): These allow a surviving spouse to receive income or use of property for life, with the remainder going to the children of the first spouse after the survivor passes away.
- Custom Distribution Plans: Trusts give you the ability to be specific about when and how assets are distributed, helping prevent misunderstandings and family conflict.
A well-crafted trust can help you honor your commitments to all family members while avoiding unintended consequences.
Planning for a Loved One with Special Needs
If you have a child or loved one with a disability, you know how important it is to plan for their long-term care. A special needs trust (SNT) allows you to set aside funds for their benefit without disqualifying them from critical programs like Medicaid or Supplemental Security Income (SSI).
Benefits include:
- Preserving Eligibility: Assets in an SNT don’t count against income or asset limits for government benefits.
- Support for Life: The trust can cover expenses not paid by benefits, such as medical care, education, transportation, and recreation.
- Ongoing Oversight: A trustee manages the trust responsibly, ensuring funds are used appropriately.
Special needs trusts must comply with strict legal requirements. Working with an attorney ensures your trust is properly structured and effective.
Protecting Your Assets with Trusts
If protecting your wealth is a priority, certain trusts can safeguard your assets from lawsuits, creditors, or financial mismanagement by beneficiaries.
Common Strategies Include:
- Irrevocable Trusts: Remove assets from your estate and protect them from legal claims.
- Domestic Asset Protection Trusts (DAPTs): Provide protection while still allowing you to benefit from the trust under certain conditions.
- Spendthrift Clauses: Prevent beneficiaries from selling, transferring, or misusing their inheritance.
These tools can help ensure your legacy is preserved and passed down as intended.
Tax Benefits of Using Trusts
Trusts can also offer significant tax advantages that reduce your overall tax burden and preserve more of your estate for your heirs.
Examples include:
- Reducing Estate Taxes: By removing certain assets from your taxable estate.
- Minimizing Income Taxes: Some trusts allow income to be taxed at a lower rate depending on how they are structured.
- Charitable Trusts: Support the causes you care about while benefiting from tax deductions.
An attorney can help you create a plan that balances your financial goals with your philanthropic values.
The Privacy and Efficiency of Trust-Based Planning
Unlike wills, which become public during probate, trusts remain private. They also allow your assets to be distributed more quickly and without court involvement.
Advantages include:
- Avoiding Probate: Assets held in a trust can be distributed immediately upon death.
- Keeping Finances Confidential: Your estate plan remains a private family matter.
- Easily Updated Plans: Revocable trusts let you adapt to changes in your life, like a new child, divorce, or major asset purchase.
Trusts give you flexibility while protecting your loved ones from unnecessary delays and stress during an already difficult time.
Why Trusts Are a Smart Choice for New Jersey Families
Trusts are more than just tools for the wealthy. They are essential for anyone looking to protect their family, streamline asset transfers, and plan for complex situations. Whether you're raising a blended family, supporting someone with special needs, or simply looking to preserve what you've built, a trust-based estate plan offers peace of mind.
Let’s Create a Trust-Based Estate Plan That Reflects Your Family’s Needs
Estate planning is about more than documents – it’s about making sure your loved ones are protected and your wishes are honored. At Ritigstein Law, we provide thoughtful, personalized guidance to help you build a plan that works for your life today and for the future.
Whether you're navigating a blended family dynamic, planning for a child with special needs, or looking to shield assets from future uncertainty, attorney Michael D. Ritigstein will work with you to craft a strategy tailored to your goals.
We proudly assist clients throughout Haddonfield, Cherry Hill, Voorhees, Medford, Haddon Heights, and the surrounding South Jersey communities.
Call 856-619-7744 today or fill out our online contact form to schedule your 30-minute consultation and take the next step toward peace of mind.
Disclaimer: This blog is for informational purposes only and does not constitute legal advice or create an attorney-client relationship. For guidance tailored to your situation, please contact our office directly.
