Deciding between a joint Trust and an individual Trust depends on your personal circumstances and goals. Here's an overview of each option to help guide your decision:
Joint Trust Benefits:
Simplified estate management: Joint Trusts allow couples to manage their combined assets in a single document, often making administration easier.
Efficient asset transfer: After one spouse passes away, the surviving spouse generally retains full control of the assets in the trust.
Unified estate planning: Couples with similar financial goals and beneficiaries can streamline their estate planning.
Joint Trust Considerations
Agreeing on distribution: A joint Trust does not allow as much individual flexibility when it comes to asset distribution. Couples must generally agree on how assets are to be distributed
Divorce or remarriage: If you get divorced or one partner remarries, updating or splitting the joint trust can be challenging.
Individual Trust Benefits:
Personal control: Each person has control over their own assets and the terms of their Trust.
Flexibility: If your financial goals or beneficiaries differ from your partner’s, an individual Trust offers more flexibility.
Separate estate planning: You can update your Trust without affecting the other person’s Trust, which can be helpful in second marriages or blended families.
Individual Trust Considerations
More complex: Managing two Trusts may involve more paperwork, separate funding, and more legal maintenance.
Jointly owned assets: Assets that are jointly owned can only be transferred to one Trust at a time. Therefore, spouses will have to agree on which joint assets should go into who's Trust.