Living Trusts – Pros and Cons

by M-Gillies

Look at Living Trusts from all angles before making your decision.

Like every decision made, there are always pros and cons and depending on which is more suitable to one’s needs, a Living Trust may not be the best option for them. However, here are a list of the advantages and disadvantages to having a Living Trust:

The advantages of a Living Trust:
* There are no restrictions on the contributions, investments, age of the contributor or who the beneficiary can be;
* Allows income-splitting tax advantages;
* A means of setting aside funds for a child’s education;
* Allows for long-term income and protection for minor children or handicapped dependents;
* Can create a trust for charitable purposes;
* Is beneficial in business succession planning;
* Can reduce probate fees.

The disadvantages of a Living Trust:
* It can be expensive and is recommended one has at least $100,000 in assets under management to consider it;
* It can be a tax liability, in which a capital gains tax could be issued on property transferred to a trust;
* After 21 years from its creation, a trust is required to dispose of all capital property.

Read more:

http://www.retirementinvestigator.com/living-trust-pros-and-cons.html

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