Protecting your estate from immature beneficiaries

For many individuals living out their golden years here in Florida, leaving an estate to their family or loved ones is not as simple as one might hope. Sometimes, the individuals who stand to receive generously from an estate are either not old enough or not mature enough to handle the assets at the time of the benefactor’s death. In these cases, a testamentary trust built into a will may prove useful.

A testamentary trust is one that is written into a person’s last will. Upon death, the assets designated in the trust pass through probate and then go into the trust. This type of trust is typically used to hold assets until a beneficiary reaches a certain age or meets maturity conditions to receive his or her payout. It is also possible to set up an ongoing incremental payout through such a trust.

In order to create a testamentary trust in a will, one must not only designate the appropriate assets and beneficiaries, but also a trustee who will handle the operations of the trust and deal with any other legal issues that may arise. One who creates such a trust must also be sure to place it in the final iteration of the will so that it is valid. If it exists solely in a version of the will previous to the final will, it may be ignored altogether.

You may face a similar dilemma. Depending on the nature of your estate and your wishes for distributing it, a testamentary trust within your last will may be a good fit. Do not wait to consult with an experienced estate planning attorney to make sure that you understand all of your options as you create a plan to leave the legacy you deserve.

Source: Findlaw, “Placing a Testamentary Trust in a Will,” accessed Oct. 06, 2017

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