When it comes to leaving assets to your children, you may be unsure which direction to go. You want to ensure that they have what they need in the future. At the same time, you’re worried about your middle child, who tends to spend money with no thought of saving for a rainy day. You may wonder how you can leave them a share of your assets without enabling their bad habits?
Consider setting up a spendthrift trust. It’s a very useful tool in helping you provide for your loved ones while protecting them from making poor financial decisions. A spendthrift trust puts a trustee in control of managing the property. They are the ones in charge of deciding how the funds are spent on behalf of the person you set the trust up for.
The benefits of setting up a spendthrift trust
Besides giving you peace of mind, there are other benefits to setting up a spendthrift trust.
- Your beneficiary will receive incremental payments on a schedule that you devise.
- Creditors will not be able to access the trust to claim outstanding payments from your beneficiary.
- Your beneficiary will not be able to squander the money in the spendthrift trust.
Setting up this trust will ensure that your loved one will benefit from your estate for many years to come.
Make a plan
Planning for the future today can save you a lot of headaches tomorrow. When you are ready to set up a spendthrift trust, seek out experienced legal guidance to help you navigate the details.