When it comes to leaving a legacy, you want to be sure that all your loved ones are accounted for. But what happens if one of your beneficiaries is a little less than trustworthy? If someone in your life is not as good at handling money as they might be, a spendthrift trust could be your best solution. This helpful arrangement will ensure that everyone is taken care of, while still protecting your legacy.
What is a Spendthrift Trust?
A spendthrift trust is similar to other kinds of trusts in most ways, but it comes with a key difference. As with any other form of trust, a spendthrift trust involves the transfer of your assets into the care of a trustee, a reliable individual who will be charged with managing the assets. After you’ve passed on, the trustee will then distribute these assets to your beneficiaries according to your wishes.
Where a spendthrift trust differs from a regular trust is that it contains a special clause, known as a spendthrift provision. In this arrangement, the assets that you want to gift to your beneficiary remain the property of the trust, rather than passing directly to your heir. The trust will then release these assets to your beneficiary in certain increments, according to the terms of this trust. This ensures that your heir will not be able to simply blow through their inheritance and will help you reach your goal of leaving a legacy for your family.
Setting up a Spendthrift Trust
Setting up a spendthrift trust is a relatively simple process, though it does come with some extra wrinkles. In most ways, it’s very similar to drawing up a regular trust, but it requires a little extra planning. You’ll need to decide how frequently you want to distribute your assets to your beneficiary and how much to dole out at a time. You may also want to include a clause for extenuating circumstances, should an emergency arise, and your beneficiary need a larger installment.
Whatever you decide, a spendthrift trust can be a great way to look out for your family while protecting your legacy. Working with an experienced estate planning lawyer will ensure that you make the best possible arrangement for you and your family.
Contact the Estate Planning Attorneys at Deliberato Law Center
When you’re ready to begin leaving a legacy, contact the experienced attorneys at Deliberato Law Center. We’re here to help you draw up an estate plan that works best for your unique circumstances. Give us a call today at (216) 341-3413 or by filling out the form below.
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