Why You Should Setup A Charitable Trusts Fund While Alive

Starting a charitable trusts fund when they are alive has become the way of people who own large estates. People with a lot of property are always in a state of confusion as to how best they should distribute their estate among their kin when they have passed away. Wills may be one way out for this, but even with wills there could be several problems in interpretation of the clauses, especially when the property to be distributed is immense. Therefore, setting up a charitable trust – which is also known as a living trust – could be a good way out of this problem.

Charitable trusts funds are set up when the original owner of the estate is still alive. During the life of the owner, the fund can help in managing the funds properly and also gather all the tax benefits that are attached to such trusts. In that manner, the trusts can be a saving option for the owner of the estate.

It depends on the owner how he or she funds the charitable trust, and later by the living trust. There are many options that can be used here – virtually every monetary asset, property and otherwise – can be used for funding. Living trusts will use assets like bonds, debentures, shares, insurance policies, properties and monetary finance to fund themselves.

The biggest advantage of charitable trusts fund is felt when the owner passes away and the assets have to be distributed among the survivors of the deceased. The following is a list of the direct benefits that are found:

-Wealth distributed through charitable trusts funds does not need to go through the probate period that exists with wills. Probates are a very difficult time to pass through, and take a heavy toll on the survivors of the deceased. However, in this case, since charitable trusts are already established, the probate period does not exist.

-Lawyer’s fees are very high when it comes to disbursement of the estate after the owner’s demise. Generally, the total expenses could go as much as two to four percent of the entire value of the property, which could be a very high sum. With charitable trusts funds, these costs are brought down to a very minimal amount.

-In most cases, the trustee surviving the original owner will have known the owner personally. Hence, there is a chance that the trustee will be able to deal with the remaining beneficiaries of the estate with fairness.

People who set up charitable trusts funds when they are alive can be safe in the assurance that their assets will be distributed judiciously and justly when they are gone, and that their kith and kin will get what they deserve with least hassles. There is a limit of $100,000 worth of assets to set up a trust. So, if they have the necessary worth of assets, setting up a charitable trusts fund is a very good idea to see that their assets go in the right hands after their demise.