TRUST SERVICES SERVICE LOYALTY HONESTY INTEGRITY

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1 TRUST SERVICES SERVICE LOYALTY HONESTY INTEGRITY

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3 USAA TRUST SERVICES Your life and your legacy. Make sure it s managed to your wishes. You ve worked hard and carefully managed your finances. Now you have the foundation of a legacy that can benefit you and your family for generations. A trust can protect your finances now and provide for those you love long after you are gone. When establishing or managing a trust, it s important to have a partner who shares your core values and has the financial expertise to carry out your wishes. USAA Trust Services is such an organization. With our mission to protect the long-term financial security of military families and our proven values of service, loyalty, honesty and integrity, we could be the right choice for you and your family.

4 SECURITY. STABILITY. PROTECTION. TURN YOUR VISION INTO A BENEFIT FOR GENERATIONS What is a trust? A trust is a flexible financial planning tool that holds, manages and distributes your assets according to your wishes. Why a trust? A trust can be one of the most powerful components in your estate plan, and choosing the right type of trust can secure the long-term stability of your assets. Equally important a trust may help determine your family s financial future, the legacy you leave behind and how you want to be remembered. A trust can help: Provide security for your family after your death Protect the inheritances of your children Ensure confidentiality of your estate Reduce or eliminate estate taxes Avoid the time and cost of probate Expedite the distribution of assets after your death Ensure philanthropic goals are met Manage your assets in the event of your incapacity

5 THE DIFFERENCES BETWEEN A WILL AND A TRUST: Everyone needs a will to ensure the smooth transfer of their assets after death. Those who use a trust in addition to a will benefit from the privacy it provides. WHO WILL BENEFIT WILL Everyone with personal property Your family, as you name who will be in charge TRUST Individuals who desire privacy Families with unique dynamics EFFECTIVE DATE After you pass On date of establishment PROPERTY Covers property in your name Covers property not passing by contract Covers only property transferred to the trust PROBATE Makes details of your estate public Passes through probate May add costs and delays Keeps details of your estate confidential Passes outside of probate Avoids costs and delays PURPOSE Names a guardian for minor children Names the executor of your estate Details the distribution of property Provides for the management of your financial affairs in the event of your incapacitation May reduce certain estate taxes Transfers property to beneficiaries

6 FLEXIBILITY. CONFIDENTIALITY. CONTINUITY. UNDERSTANDING PERSONAL TRUSTS Revocable Living Trust Because you can amend or terminate this trust at any time during your life, a revocable living trust offers the most flexibility and control of any trust. Like most trusts, it provides efficient distribution of assets. However, its most common use is assuring the management of your assets won t be interrupted if you become incapacitated, disabled or die. This trust is also probate-friendly, making it the preferred choice among people who own property in multiple states. Establishing a trust eases the burden on your family of managing and distributing your assets. Finally, it provides privacy for you and your family. Irrevocable Trust Once established, the terms of this trust cannot be altered. While an irrevocable trust offers most of the same probate protection as a revocable trust, it can provide additional estate tax savings. This is because once property is transferred, future appreciation is not generally included in your estate. An irrevocable trust may also offer credit protection for your beneficiaries. Testamentary Trusts Unlike revocable and irrevocable trusts, a testamentary trust goes into effect upon your death as specified in your will. This trust may be right for you if you want to retain control of your assets during your lifetime, but understand the importance of managed distributions after your passing. Other types of trusts: Bypass Trust (or Credit Sheltered Trust) Generation-Skipping Trust Charitable Annuity Trust (or Unitrust) Grantor Retained Annuity Trust Qualified Domestic Trust Irrevocable Life Insurance Trust

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9 CHOOSING THE RIGHT KIND OF TRUST Weighing your options Each type of trust will fill a specific need, and the one that s best for you will depend on many factors. Rather than trying to choose a trust based solely on its description, it s best to determine the estate planning challenges you face and seek professional advice. USAA Trust Services will work with your attorney and any third-party financial advisor to help you choose the trust that meets your unique needs. Here are some questions to consider: Do your marital assets exceed the maximum applicable exclusion for federal estate taxes? Do you wish to leave your estate to your spouse or significant other but still make bequests to other beneficiaries after your spouse s death? Do you wish to leave money to your grandchildren without affecting your children s estate? Do you want to keep proceeds from insurance policies out of your taxable estate? Do you wish to provide for a current spouse or significant other as well as children from a previous marriage? Are you concerned about how your assets will be managed during periods of personal disability? Are any of your beneficiaries disabled or otherwise unable to manage their inheritance according to your wishes? Do you plan on using your estate for philanthropic purposes? Based on the answers to these and other questions, your USAA advisor will assist you in determining the trust that best fits your unique situation.

10 CHOOSING THE RIGHT TRUSTEE Selecting the right trustee is important because administration of trusts can be complicated and timeconsuming. Since trustees can be held legally and financially responsible for their actions, an institution is often a better choice. Why USAA? Shared values. Shared history. Our team of investment, tax and administration professionals dedicates their time and attention to managing trusts. But more important, our service stems from the values that serve your long-term financial interests: service, loyalty, honesty and integrity. USAA Trust Services may act as: Trustee Co-Trustee Successor Trustee Agent for Trustee Investment Manager You ve worked too hard for yourself and your family to leave your financial security to just any organization. Choose a partner you can trust. Put your trust in USAA As the provider of choice for military families, USAA works with members to provide for their financial security by helping them manage money across generations. Contact USAA Trust Services today at or visit usaa.com/wealth

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12 Naming USAA Federal Savings Bank as a successor trustee does not necessarily guarantee USAA Trust Services will accept the appointment of trustee. It is important to have language to name an alternate or allow your beneficiaries to name an alternate in such a circumstance. USAA Bank will not render an opinion of acceptance or declination for successor nominations until required to serve. Trust products and services are provided by USAA Federal Savings Bank. USAA Wealth Management is a service of USAA. USAA means United Services Automobile Association and insurance, banking, investment and other companies, Bank Member FDIC. Brokerage accounts are introduced and brokerage services are provided by USAA Financial Advisors, Inc. (FAI), and USAA Investment Management Company, both registered broker dealers and Members SIPC. Clearing, custody and other services are provided by National Financial Services LLC, an unaffiliated firm, Member NYSE and SIPC. Certain financial planning and advice provided by USAA Financial Planning Services Insurance Agency, Inc. (FPS) (known as USAA Financial Insurance Agency in California, License # 0E36312), a registered investment adviser and insurance agency. Securities and certain financial guidance offered through FAI, a subsidiary of FPS. Life insurance and annuities provided by USAA Life Insurance Company, San Antonio, TX, and in New York by USAA Life Insurance Company of New York, Highland Falls, NY. Other life and health insurance from select companies offered through USAA Life General Agency, Inc. (known in California (License # ), and in New York as USAA Health and Life Insurance Agency. Non-deposit investment and insurance products are not FDIC insured, not bank guaranteed and may lose value. Trust Services offered by USAA Federal Savings Bank, Member FDIC USAA