The most surefire way to predict the future is to incrementally plan and build towards it on your own terms.
What you do today immediately informs how your short-term and long-term future plans will play out.
And that is the best way to describe a trust. A trust is essentially a legacy and familial financial fund that is designed to look after your beneficiaries.
A designated trustee manages and oversees a trust to run it according to the trustor, or the person who establishes it.
If you don’t have a trust, then the finances and assets in your estate could be distributed according to local laws and a probate court. More than 67% of Americans either don’t have a trust or don’t even consider making plans to establish one.
To make matters even more complicated, every state has differing laws regarding trusts and estate planning. However, here are the seven best states in which to draw up a trust for your family:
- New Hampshire
- South Dakota
One of the biggest benefits of drawing up a trust in these states is that they either don’t have an income, estate, or inheritance tax.
Your trust does not necessarily have to be drafted in your same state of residency, although there could be some tax or legal complications in doing so. But there could be several benefits to drawing up a trust in a different state.
Always consult a lawyer when in doubt.
Legal protections from contestation lawsuits and creditors
Like most states, the trust-benficial seven states have laws that protect the assets in trusts from contestation, creditors, lawsuits, and estranged relatives, friends, associates, and business partners who would fight your true beneficiaries for a piece of your estate.
Legally long-lasting trusts
You may be surprised to know that in most states, a trust is not everlasting. A fiduciary trust can only legally exist 21 years after the death of the last surviving beneficiary named in the trust.
However, in the previously named states, a legal trust can exist virtually forever.
A trust drafted in Alaska, New Hampshire, or South Dakota can exist forever and into perpetuity. The same is technically true in Delaware, however, any real estate assets connected to the trust have to be sold after 110 years.
If you live in Wyoming, then a trust can exist for 1,000 years. In Tennessee, a trust will last for 360 years. Live in Nevada? A trust will last for 365 years there.