October 28, 2016

Investments: Choosing a Trust Fund

Different kinds of trusts are designed to meet different financial objectives. A Lake Michigan Investment Services advisor can help sort out your needs and make unbiased recommendations for your particular situation. Let’s talk basics.

Living Trust
A living (or revocable) trust allows you to retain control of your funds while you’re alive.Upon your passing, a designated successor trustee manages the remaining assets according to terms that you set forth in the trust, avoiding the probate process.

Special Needs Trust
This trust is designed to benefit a disabled individual without disqualifying them for government benefits like Social Security Income (SSI) and Medicaid. A Special Needs Trust provides for supplemental care beyond housing, food, and clothing without violating asset or income limits.

Survivor’s Trust 
A Survivor’s Trust is a trust created by an individual during life that becomes irrevocable  after his or her death, to provide for a surviving spouse, domestic partner, or other loved ones. “Survivor’s Trust” is a general term for a variety of common trusts: A Trust, Marital Trust, B Trust, Family Trust, Bypass Trust, or Credit Shelter Trust, among others.

Charitable Lead Trust
To help benefit your favorite charity while serving your own trust purposes, you might consider a Charitable Lead Trust (CLT). This trust lets you pay a charity income from a particular asset for a designated amount of time, after which the principal goes to the beneficiaries, who can receive the property free of estate taxes.

Charitable Remainder Trust
Another charitable option, the Charitable Remainder Trust (CRT), allows you to receive income and a tax deduction at the same time, and ultimately leave assets to a charity.

Irrevocable Life Insurance Trust
This type of trust is often used as an estate tax funding mechanism. Under this trust, you make gifts to the trust, which in turn uses those gifts to purchase a life insurance policy on you. Upon your death, the policy’s death benefit proceeds are payable to the trust, which in turn provides tax-free cash to help beneficiaries meet estate tax obligations.

Contact Lake Michigan Investment Services today for a free, no-obligation review of your
financial situation.