United Bank of Iowa

In the process of working through your estate planning options? Talk to your attorney to determine if a trust is the right tool for you. If so, the UBI Trust Department is here to help! The bank serves as trustee for several types of trusts, including revocable, irrevocable, irrevocable life insurance, living, and testamentary trusts, to name a few. As trustee, we follow the instructions outlined in the trust agreement to determine our duties and responsibilities. Within your trust agreement, you can specify the terms of the trust, including when distributions may be made and who may receive them.

A properly structured trust can help protect your estate from heirs’ creditors or from beneficiaries who may not be adept at money management. One important purpose of a trust is to transfer assets from one person to another, while another may be to ensure a steady income stream is provided to support beneficiaries throughout their lifetime. 

Trusts can hold many different types of assets, including investment accounts, homes, vehicles, and land, among many others. One advantage of a trust is that it often allows your assets – and your heirs – to avoid probate after death, helping simplify the transfer process. 

There are many reasons why it might be beneficial to look into the advantages of a trust.

• Reduction of tax liabilities and probate costs
• Keeping assets out of a surviving spouse’s estate while providing income throughout their lifetime

• Protecting individuals from poor judgment, unwise investment decisions, and the risk of being taken advantage of by friends, family, or strangers
• Care for special-needs individuals
• Ensuring multi-generational transfer of wealth
• Carrying out charitable intent in a tax-efficient manner
• Protecting assets from creditors and/or from becoming marital assets in a divorce

Another important duty to think about BEFORE it is needed is a power of attorney. A power of attorney (POA) is a legal document that allows someone to act on your behalf while you are still living. It can be an important tool in planning for future incapacity; for example, if you are facing a lengthy hospital stay and need someone to pay your bills, or in the event of dementia or another condition that affects cognitive capacity. 

If you already have a power of attorney (POA), make sure the bank has a copy on file so that if or when your POA needs to complete a transaction on your behalf, the bank knows they have your permission to do so. Make sure to notify the person named as your POA so they are aware that they may need to step in and assist you if needed. Upon death, power of attorney authority ends and can no longer be used. After death, the individuals authorized to act would be your executor, as appointed in your Last Will and Testament, or your trustee, as appointed in a trust agreement.