If you have children, one of the best ways to leave your assets to them is through various kinds of trusts. Choosing the right trust is key for Floridians who want to maximize what they leave for their heirs.
General factors to consider
Everyone’s estate planning situation is different, but you should be aware of general rules about trusts when choosing which one is right for your purposes. The age of your children when you create or modify your estate plan is a big factor. Minor children cannot own assets, so it makes sense to put them in a trust in case of your untimely demise. But what happens when that child turns 18? Florida law states that all money and property in a guardianship trust must be turned over to children to do as they wish. For some heirs, that situation is unwise if the children will quickly blow through all the assets.
Setting up lifetime trusts and dividing inheritance among multiple children
For many families, a wiser decision involves setting up a lifetime trust for each child and dividing assets accordingly, no matter their age. Your children would have to ask the trust administrator for the money, which can also cause problems. Customizing trusts by allowing your children to receive specified amounts or percentages of the assets at certain ages is another solution.
What happens if one of your children dies and the money is still held in trust? Take care of that possibility by including a “powers of appointment” clause where someone has the ability to distribute the assets among grandchildren or other heirs.
Careful estate planning can make your assets go further. Remember, life is constantly changing, so you have the right to update your estate planning tools as needed.