You can have a will without a trust, but not a trust without a will—and you surely can have assets without either plan, but it is not advised. Does the world of estate planning leave you a bit bewildered? We asked local attorneys to specifically weigh in on trusts.

Jennifer Davis, of Greensfelder, Hemker and Gale, explains that a trust is a legal relationship between three parties: the grantor, the trustee and the beneficiary. The grantor creates the trust to hold assets for the beneficiary, and the trustee is in charge of its administration.

Melissa Nolan, of Paule, Camazine & Blumenthal, adds a big difference between a trust and a will is that the trust is a vehicle of use for your lifetime; a will only comes into play upon a person's death. "The trust will also avoid probate, where as a will is a direction to the probate court…In the end, it's a cheaper and faster process of getting the money to your beneficiary." Additionally, Nolan explains that in Missouri, trusts are completely private documents; wills are public.

The most frequent type of trust is a regular revocable trust, "that is basically…a probate avoidance technique," according to Misty Watson of Danna McKitrick. "You're avoiding probate, plus you have a lot more control under a trust how your beneficiaries get the assets. Typically, in a will, you say, I want my estate to go to my brother and sister in equal shares; in a trust you can say, I want my assets to go to my brother and sister in trust, and my trustee can make distribution for them for their education because that’s the most important part to me."

Another option is a joint trust, which Davis says is becoming more popular in Missouri due to a change in legislation. As of 2011, assets owned jointly between a husband and wife are protected if a claim is filed against one of the two, Davis explains. "If they're designed correctly, [joint trusts] will meet that Qualified Spousal Trust under Missouri law," she says. For instance, if one spouse is a doctor, and he or she is sued for medical malpractice, the assets in the joint trust would be protected, Davis says. 

Watson mentions a more specific trust: one for a beneficiary with a disability. "Let's say that somebody has a diagnosis of Down syndrome. Typically, once they're 18, they're eligible to receive government benefits," Watson says. "I can leave funds for them in trust under what's called a special needs trust, and it's not considered their asset for purposes of qualifying for government programs." This "supplemental support" can then be used to cover what government benefits do not.

When selecting a trustee, Nolan recommends selecting co-trustees when possible, to create more checks and balances within the asset system. "The most important thing to think about when appointing a trustee is that a trustee is just what it sounds like: You are trusting that person to do what you intended them to do; you're trusting them with your assets, and you're trusting them to take care of your beneficiaries upon your death," she says, adding that trustees need to fully understand their role.

Watson says one of the most important things to note about a trust is that it only transfers assets outside of probate if either your assets name the trust as a beneficiary, or the assets are titled in the trust. If assets are not properly accounted for, they will still have to go through probate. "I probate more vehicles and savings bonds than anything else," Watson says, noting that people often assume the car they currently own will not be their last.

In regards to taxes, Nolan explains that because estate tax laws have changed in the last few years, estate taxes play a lesser role for more people. Currently, estate taxes have an exemption set at $5.34 million. "If you have an estate that's over $5 million, then you need to be doing some type of estate tax planning through your trust," Watson concludes.

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