As uncertainty remains in the markets, Dean Mioli, Head of Investment Planning at Independent Advisor Solutions by SEI, authors a piece exploring how advisors can leverage trust services to add value with clients. Specifically, Dean highlights the low-interest rate environment as a potentially favorable backdrop for grantor retained annuity trusts (GRATs) and charitable lead trusts (CLTs).Read full article here
Independent Advisor Solutions is a strategic business unit of SEI Investments Company (SEI).
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A GRAT is a financial instrument used in estate planning to help minimize taxes on large financial gifts to family members. Under these plans, an irrevocable trust (the terms cannot be modified, amended or terminated without the beneficiary's permission) is created for a certain term or period of time. The individual establishing the trust pays a tax when the trust is established.
A CLT is an irrevocable trust designed to provide financial support to one or more charities for a period of time, with the remaining assets eventually going to a family member or beneficiary. A CLT requires the charitable payment to be made each year, regardless of whether there is sufficient trust income available.