A complete estate plan will look different for each person in Oklahoma. What might work quite well for one individual can be far less effective for another, but there are a few key items that tend to form the backbone of most plans. Wills, living wills and trusts are all common features of estate planning, even if they are applied in different manners. However, trusts tend to be some of the least understood and utilized estate planning tools.
There is more than one type of trust, each of which can provide different benefits depending on a person's unique circumstances. An irrevocable trust is usually preferred by those seeking a reduction for any future estate tax that might be owed. This works by completely removing the assets contained within a trust from the control of that individual's estate. While no longer having the ability to exercise control over the trust might be uncomfortable, the person creating the trust can provide specific instructions as to how the trustee and beneficiary should act in the case of certain events.
Revocable trusts allow individuals to exercise continued control over their assets. Assets can be added or removed from a revocable trust, beneficiaries can be changed and the trust itself can even be altogether dissolved. These types of trusts do not provide the same tax benefits as irrevocable trusts since they are still considered to be part of a person's estate, but they do have the added benefit of allowing people to make changes when necessary.
Both revocable and irrevocable trusts have specific benefits that are clearly separate from the other, but they do share a common perk of skipping probate. Unlike wills, which leave a public record of all inheritances and beneficiaries from an estate, trusts can keep this information private and concealed. These tools are especially helpful for those in Oklahoma who value privacy in certain matters.
Source: wealthmanagement.com, "Clearing Up Common Estate Planning Misconceptions", Scott Grenier, June 10, 2016