Florida residents who are working on an estate plan may want to consider a Totten trust if they want to avoid making a will or going through the probate process. With a Totten trust, a person opens a bank account and makes deposits for a beneficiary. The person is able to withdraw money from the account or close the account altogether without the beneficiary’s permission, and the trust can be maintained without the beneficiary’s knowledge.
The money transfers to the beneficiary either on the owner’s death or with an action by the owner such as giving the beneficiary the passbook. People who are considering a Totten trust should keep in mind that the assets in it may be subject to creditors’ claims on the estate.
However, for people who want to keep their finances private, a Totten trust may be a good solution. Probating a will may be expensive and is a public process, and a Totten trust bypasses probate.
People who are planning for the distribution of their estates after they die may want to begin by considering their goals. For example, they might want to insure that an heir gets a college education before receiving their money, or they may want to support a relative who cannot manage their own money. A person with a large estate might want to consider how to minimize taxes. A person may want to make sure the inheritance is protected from creditors. There are many different kinds of trusts that can achieve these types of aims.
People should also discuss with their estate planning attorney how they want their assets and their health managed if they become incapacitated. For example, a person might want to use a power of attorney to designate someone to handle financial affairs and a living will and health care directive to plan their medical treatment.