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Trusts no longer just for the super rich

There was a time when trusts were an estate planning tool used only by the very wealthy. That is no longer the case. New Jersey estate attorneys know that the middle class has expanded to a point where someone of even modest wealth may find a trust to be just the thing to ensure that the value of what they hand on to their heirs is protected.

From what might you want to protect your assets? There are many things. Start with taxes. Right now any estate worth $5 million or less is exempt from estate taxes. But Congress has set that exemption to expire in 2012. If lawmakers let that number drop to the $1 million mark that it once was at, that could easily be hit by the combined value of real estate and a 401(k) nest egg. Trusts also limit taxes if you leave money to a charity.

Trusts can also help protect the inheritance from claims of divorcing spouses and creditors. Gifting of the money can be done with strings attached so that whoever receives the benefit uses it only for purposes you are willing to support, such as education.

If dependents of yours are unable to care for themselves, the trust can be used to be sure they will always have the level of care they require. It could also be set up to make sure you are taken care of properly if you become unable to care for yourself.

Trusts have the added benefit of saving surviving family members the headache of having to settle matters of the estate through the courts

The conclusion to draw from all this is that you can trust that a trust will fulfill your will when such a time comes for that. To set one up, consult an attorney.

Source: CNBC.com, "Should You Have Confidence in Trusts?," Jessica Rao, Dec. 5, 2011

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