1) Provide Quick Access to Resources
It typically takes a year for a will to pass through probate court. Will this waiting period create any uncertainty or instability for your loved ones? If you feel your family will need access to your assets immediately then it can be helpful to set up a trust. Trusts serve many purposes and despite popular belief aren't just for the wealthy. Assets or property you put in trust are available to your family according to a timeframe you select, because unlike a will, a trust does not have to pass through probate.
2) Protect Children's Financial Interests
Some parents desire to protect young adult children from their financial inexperience. Anything you leave to a child in a will is distributed to them outright after the probate process is complete. By using a trust, you allot certain portions of your assets to be distributed to you child as they reach certain ages. For example you can distribute half to the child at age 25 and the remaining half at age 30. Another benefit to a trust is that assets are protected in case your child gets into difficulty with creditors or goes through a divorce. Likewise a trustee can withhold funds from a child who may be struggling with alcohol and druge abuse, so these funds can be available when the child is back on their feet.
3) Protect Special Needs Family Members
You may have a relative or child with special needs. To qualify for disability benefits requires that the recipient have very few assets. If you leave money outright to a person with special needs, even if it isn't a huge amount of money it can potentially disqualify the recipient from benefits programs. Placing assets in trust can allow a family member to benefit from your provision while remaining eligible for government benefits.
4) Preserve Your Privacy
A will becomes a public record, so if there are provisions in your will that you prefer to keep quiet a trust can be a useful alternative. Maybe you don't want people to know the value of your business, the names of people you've disinherited, or other personal financial information. A trust, since it need not go through probate court, is a private document.
5) Ensure Your Wishes Will be Carried Out
If you provide in your will for your home or vacation home to go to your children, your children may disagree about how they will share the property. They may argue about sharing the use of the property or about how much ownership interest each is entitled to. If so, any one them can petition the probate court to challenge your will. Not only is this costly, it can cause painful family rifts, and the outcome may conflict with your wishes. To help prevent this you can leave real estate in trust to your children. You could state, for example, that your three children each hold one-third interest in the property, or that the child who moved in with you and took care of you is to receive a larger interest. To prevent in-fighting, you can also make provisions that say Mary may use the vacation home in August, Peter in July and Emily in June. They may not like it, but they'll have less recourse.
6) Tax Benefits
In some cases (depending on the total value of your estate) there can be significant tax benefits to leaving assets in trust rather than distributing them outright through a will.