A trust in Nebraska isn’t just for the wealthy—people at all financial levels can benefit from having one. Trusts, including revocable and irrevocable trusts, can save your loved ones from the lengthy, costly, and sometimes stressful probate process while giving you control over how your assets are distributed. Additionally, a trust ensures your assets are managed on your behalf if you become incapacitated, avoiding the need for a court-appointed conservator. Whether you have significant assets or simply want to ensure your wishes are followed, a trust can provide peace of mind and a smoother process for your loved ones.
Do You Need a Trust in Nebraska?
How Does a Trust Work?
A living trust, also known as a “revocable trust,” is a tool that allows you to distribute your assets while avoiding probate. When you create a trust, you transfer ownership of chosen assets into the trust, which is managed by a trustee—often yourself while you’re alive. Think of a trust as a legal entity that holds your assets and ensures they’re handled according to your wishes. Unlike individuals, a trust doesn’t “die,” which allows it to continue managing and distributing assets after your passing.
Successor trustees take over when the original trustee becomes incapacitated or passes away, ensuring continuity without court intervention. One of the key advantages of revocable trusts is their flexibility—you can revise or update them during your lifetime as your needs change.
To make a trust effective, it must be funded, meaning assets need to be retitled into the trust’s name or have beneficiary designations updated to transfer to the trust upon your passing. Properly funding the trust ensures your loved ones can avoid probate entirely. An experienced Nebraska estate planning attorney can help you set up and fund your trust, ensuring that your assets, whether in real estate, investments, or trust funds, are distributed exactly as you intend.
Deciding Which Type of Trust is Right for You
Not all trusts are the same, and the best option for you depends on your goals. Here are some common types of trusts in Nebraska, including revocable and irrevocable trusts:
Trust Under Will (Testamentary Trust)
If you have minor beneficiaries, this type of trust holds their inheritance until they reach a suitable age. While it provides control over how and when assets are distributed, it must go through probate since the trust is created within the will.
Revocable Trust
A popular choice, revocable trusts allow you to designate beneficiaries, avoid probate, and maintain privacy. You retain control over the trust during your lifetime and can make changes as needed. Revocable trusts streamline asset management during incapacity and after death, making them a flexible and efficient option.
Irrevocable Trust
Unlike a revocable trust, irrevocable trusts cannot be changed once established. These trusts are often used for specific purposes such as Medicaid planning, tax benefits, or providing for beneficiaries with special needs. While less flexible, they offer strong protections for assets and can help achieve unique estate planning goals, such as managing trust funds for future generations.
Do You Still Need a Will if You Have a Trust?
Even with a trust, a will plays an essential role in your estate plan. It acts as a safety net to ensure any assets not transferred into your trust during your lifetime are directed into the trust after your passing. This helps guarantee that no assets, such as trust funds, are left out of your overall plan.
Additionally, a will is a document where you can designate guardians for minor children and make personal gifts of sentimental items, such as heirlooms or jewelry. Having both a trust and a will allows you to create a comprehensive estate plan that ensures all bases are covered and your loved ones are protected.
Is a Trust Better Than a Will?
A will and a trust serve different purposes, and the right choice depends on your unique needs. A will is simpler and more cost-effective, making it suitable for straightforward estates. It directs how assets are distributed after death but requires probate, which can be time-consuming and public.
A trust, particularly revocable and irrevocable trusts, offer more flexibility and privacy. Trusts allow for the seamless management of assets during your lifetime and help to avoid probate altogether. They are ideal for more complex estates, those with specific goals such as asset protection, or managing trust funds for beneficiaries. In many cases, using both a trust and a will creates the most comprehensive estate plan.
Determining if a Trust is Right for You
Deciding whether you need a trust, a will, or both can feel overwhelming, but you don’t have to navigate this alone. At Nebraska Legal Group, our experienced Nebraska estate planning attorneys are here to guide you through the process. Whether it’s setting up revocable or irrevocable trusts or creating a custom estate plan, we’ll ensure your wishes are honored, and your loved ones are cared for.
Contact us today for a consultation and start building a plan that gives you peace of mind.
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