Estate Planning in Arizona

Trusts can be very usual tools for couples who want to protect and manage their assets during their lifetimes and ensure a smooth transfer of wealth to the next generation.

Joint trusts are a type of living trust created by two people (usually a married couple) that allows them to combine their assets into one trust. This approach can simplify estate planning, but it also has some drawbacks that should be considered.

What are the pros of joint trusts?

Aside from the fact that one joint trust is easier to manage than two trusts, joint trusts:

  •  Avoid probate: When one partner dies, the trust’s remaining assets can be transferred to the surviving partner without going through (a lengthy and expensive) probate. That gives the surviving partner immediate access to the money or assets involved.
  •  Asset protection: Couples who are worried about potential lawsuits, debt issues or “money grabs” by certain relatives may find a trust useful for keeping their assets secure and out of reach.
  •  Tax benefits: In high-value estates, joint trusts can be structured to minimize estate taxes and maximize the inheritance that will eventually pass to their beneficiaries and heirs.

Finally, it can be easier to create a joint trust than two separate trusts in the first place, especially if the couple has complicated assets that are hard to divide.

What are the cons of joint trusts?

Primarily, the lack of flexibility in a joint trust can be a problem, especially if the two spouses don’t agree about who should ultimately be a beneficiary or how much they should receive.

When there are individual trusts, each spouse can control what happens to their assets over their death – when there is a joint trust, they have to make all decisions together. This can be particularly problematic if there are children from a prior relationship involved, and one or both spouses are concerned about protecting their interests.

There’s a lot to consider when you’re thinking about creating a trust. That makes it wise to seek legal guidance.  Call or contact us for your free initial consultation.

Andre L. Pennington attributes his passion and success as an Arizona estate planning lawyer and licensed financial professional to one thing: wanting to do what’s right for his Family.