Do I Need a Trust?

Most mid-career professionals I meet believe trusts are only for the ultra-wealthy—reserved for families with vast estates and complex financial situations. But that's a misconception that could cost your family time, money, and unnecessary stress.

🔑 Key Takeaways

✅ Trusts aren't just for the ultra-wealthy—they benefit families who value privacy, speed, and control

✅ The average probate process takes 20 months and costs 3-7% of your estate value

✅ Trusts avoid probate, saving time and money while keeping your estate private

✅ Consider a trust if you own property in multiple states, have minor children, or value asset protection

✅ The 2025 federal estate tax exemption is $13.99 million per individual—trusts help minimize taxes for larger estates

The Biggest Benefit: Avoiding Probate

The primary advantage of establishing a trust is avoiding probate entirely. When your assets transfer through a trust, your heirs receive their inheritance faster, cheaper, and with complete privacy.

Here's why this matters: According to a 2024 Trust & Will Probate Study, the average probate timeline in the United States is 20 months. Yet most Americans dramatically underestimate this—only 2% of survey respondents believed probate would take that long.

The financial impact is equally significant. Probate costs typically range from 3-7% of your estate's total value, according to recent probate cost analysis. For a $750,000 estate—a realistic figure for many mid-career professionals with home equity, retirement accounts, and life insurance—this translates to $22,500 to $52,500 in probate fees alone.

With a traditional will, your estate becomes public record. Anyone can access information about what you owned, who inherited what, and how much your assets were worth. Court proceedings can drag on for months or even years, delaying when your family actually receives their inheritance.

A properly funded trust bypasses this entire process. Assets transfer to your beneficiaries according to your instructions, without court involvement, public disclosure, or extended waiting periods. As Schwab notes in their analysis of revocable living trusts, this privacy and efficiency is one of the most compelling reasons mid-income families establish trusts.

Managing Assets During Your Lifetime

One often-overlooked advantage: trusts aren't just about what happens after you're gone. They're powerful tools for managing your assets during your lifetime, especially if you become incapacitated.

Consider this scenario: You're in your peak earning years, you've accumulated substantial retirement accounts, you own your home, and you're managing college savings for your kids. Then you suffer a serious accident or illness that leaves you unable to manage your finances.

Without a trust, your family may need to petition the court for conservatorship—a public, expensive, and time-consuming legal process. According to TIAA's trust education resources, a properly structured trust keeps things moving without court intervention. Your designated successor trustee can immediately step in to pay bills, manage investments, and handle financial decisions on your behalf.

This continuity of asset management is particularly valuable for families with:

- Complex investment portfolios requiring active management

- Business ownership interests that need ongoing attention

- Rental properties demanding regular oversight

- Minor children with financial needs that can't wait months for court appointments

Do You Actually Need a Trust?

Not every family needs a trust, but certain situations make them particularly valuable. You might benefit from establishing a trust if you:

📋 Have Minor Children

If something happens to you before your children reach adulthood, a trust ensures their inheritance is managed responsibly until they're mature enough to handle it themselves. You can specify the age at which they gain control—many parents choose staggered distributions at ages 25, 30, and 35 rather than a lump sum at 18.

🏠 Own Property in Multiple States

Owning real estate in multiple states creates a probate nightmare. Without a trust, your estate must go through probate proceedings in every state where you own property. A trust holds all your real estate, regardless of location, avoiding multiple probate proceedings and significantly reducing complexity and costs.

💰 Want to Minimize Estate Taxes

For 2025, the federal estate tax exemption is $13.99 million per individual—or $27.98 million for married couples with proper planning, according to IRS guidelines. If your projected estate (including life insurance death benefits, retirement accounts, real estate, and other assets) approaches or exceeds this threshold, advanced trust strategies can help minimize estate tax liability.

It's worth noting this exemption is temporary and scheduled to drop to approximately $7 million per person in 2026 unless Congress acts, as noted by Schwab's estate tax analysis.

🔒 Value Privacy

Some families simply prefer keeping their financial affairs private. If you don't want your estate—including asset values, beneficiaries, and distribution details—becoming public record accessible to anyone, a trust provides complete privacy.

🎯 Have Blended Family Situations

Trusts offer precise control over asset distribution, making them particularly valuable for second marriages, blended families, or situations where you want to provide for a surviving spouse while ensuring assets ultimately pass to children from a previous marriage.

The Downsides: Cost and Complexity

Trusts aren't the right solution for everyone. They're significantly more complex and expensive to establish than a basic will.

Initial setup costs for a comprehensive revocable living trust typically range from $1,500 to $4,000, depending on your location and estate complexity. Compare this to $300-$1,000 for a basic will.

Ongoing maintenance requires attention too. You must properly "fund" the trust by transferring asset titles into the trust's name—this includes retitling real estate, updating financial account registrations, and maintaining accurate records. As you acquire new assets, you'll need to ensure they're properly titled in the trust's name.

Management requirements continue throughout your lifetime. While you maintain complete control as trustee, you're responsible for keeping records, filing any required tax returns, and ensuring the trust remains properly funded.

For young professionals just starting out, with modest assets and straightforward family situations, a well-drafted will combined with proper beneficiary designations on retirement accounts and life insurance may be entirely sufficient.

Making the Right Decision for Your Situation

The trust question isn't one-size-fits-all. The right answer depends on your specific situation—your asset mix, family dynamics, privacy preferences, and long-term goals.

Start by taking inventory:

- What's your projected estate value, including life insurance and retirement accounts?

- Do you own real estate in multiple states?

- How old are your children, and what's their level of financial maturity?

- How important is privacy to you and your family?

- Do you have business ownership interests or complex asset structures?

- Are there blended family considerations?

Consider your timeline:

If you're approaching the $13.99 million estate tax threshold, or if the exemption drops as scheduled in 2026, proactive planning becomes more critical. Similarly, as your children approach college age and your assets continue growing, the probate avoidance benefits become more compelling.

Think about family dynamics:

Do you anticipate any potential conflicts among heirs? Are there special needs considerations? Do you want to provide ongoing financial guidance and protection for beneficiaries who may struggle with sudden wealth?

What to Do Next

If you're uncertain whether a trust makes sense for your family, the best next step is a comprehensive estate planning review with a qualified professional who understands your complete financial picture.

At Balanced Life Planning, I work specifically with mid-career professionals navigating exactly these questions—balancing expanding incomes, college planning, retirement savings, and protecting what you've built for your family's future.

During a consultation, we'll:

✅ Review your current estate planning documents (or lack thereof)

✅ Analyze your asset structure and projected estate value

✅ Discuss your family situation, goals, and concerns

✅ Determine whether a trust, will, or combination strategy best serves your needs

✅ Provide clear recommendations with transparent cost estimates

✅ Connect you with qualified estate planning attorneys if trust implementation is appropriate

The peace of mind that comes from having the right estate plan in place—one that protects your family, preserves your legacy, and aligns with your values—is invaluable.

Ready to explore whether a trust makes sense for your situation? Schedule a consultation with Balanced Life Planning to discuss your estate planning needs and get personalized guidance based on your unique circumstances.

Sources & References

1. [Schwab - Revocable Living Trust vs Will](https://www.schwab.com/learn/story/revocable-living-trust-vs-will)

2. [TIAA - What is a Trust?](https://www.tiaa.org/public/learn/retirement-planning-and-beyond/what-is-a-trust)

3. [Trust & Will - 2024 Probate Study: Costs, Timeline, and Emotional Toll](https://trustandwill.com/learn/2024-probate-study)

4. [Eternal Vault - Probate Costs by State: Complete Guide for Families (2025)](https://eternalvault.app/blog/probate-costs-by-state-complete-guide-families/)

5. [IRS - Frequently Asked Questions on Estate Taxes](https://www.irs.gov/businesses/small-businesses-self-employed/frequently-asked-questions-on-estate-taxes)

6. [Schwab - The Estate Tax and Lifetime Gifting (February 2025)](https://www.schwab.com/learn/story/estate-tax-and-lifetime-gifting)

DISCLOSURE: The information contained herein has been obtained from sources believed to be reliable but cannot be guaranteed for accuracy. Balanced Life Planning is a registered investment adviser. Registration does not imply a certain level of skill or training. Information presented is for educational purposes only, is subject to change from time to time, and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated, are not guaranteed. Be sure to first consult with a qualified financial adviser and/or tax professional before implementing any strategy discussed herein. Past performance is not indicative of future performance.

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