Drawing up a will or creating a trust can initially feel like passing on the responsibility of your things to other people. Grandma’s old piano might be intended for your granddaughter, the china cabinet for your son and a charitable trust for your favorite New Jersey non-profit. However, much of estate planning isn’t about losing control; it’s about maintaining control and ensuring proper asset protection.
Trusts are an excellent example of how much control people can still maintain over an estate plan. Although a trustee must be named, it is not necessary for an individual to name themselves. The creator of the trust is still technically the owner and can still make the decisions, including getting rid of one trustee in favor of another who may be more amicable to work with.
For those who have relatively simple estate plans — such as a will, various power of attorneys and maybe little else — it may feel less important to keep control over some things. If a parent intends to leave a child to home, some may think it makes sense to go ahead and give it to him or her while continuing to live there. Unfortunately, doing so can affect an individual’s Medicaid eligibility or the ability to make any major changes. Even deciding to sell it is no longer in the hands’ of its residents, and many decisions may require permission from a child.
Ultimately, most estate plans do come down to control. It’s an understandable desire to seek out asset protection and to make sure items important to people during their lifetime make it to the correct place, even after he or she has passed. Despite what may be contradicting popular opinion, people in New Jersey might benefit from taking a careful review of their estate plan to make sure that proper control is still in place over their assets and, perhaps more importantly, their decisions.
Source: Forbes, “Never Give Up Control When You Create Your Estate Plan“, Mark Eghrari, Nov. 13, 2014