We understand that many people establish estate plans with the goal of protecting their assets for themselves and for their families. Much of this protection comes in the form of preventing creditors and the government from taking away assets upon death. However, the beneficiaries you wish to leave assets to are often the loved ones who pose the most risk to the assets themselves. To help mitigate these risks, you can establish a spendthrift trust. At the Law Offices of Andrew Cohen, our Santa Clarita spendthrift trust attorneys have experience working with clients to create a spendthrift trust that will ensure their assets are passed on according to their wishes.
There are various reasons why a spendthrift trust may need to be established, and the team at the Law Offices of Andrew Cohen is ready to help. We will provide personalized attention for your particular case so that all of your needs are properly addressed.
A spendthrift trust is used in situations when a person wants to leave their assets to a beneficiary who they know or suspect cannot responsibly handle the money, real estate or other assets. What situations are covered? There are mamy reasons why someone may not responsibly handle assets left to them. Some people are too young, and may or may not grow into a level of responsibility. Other times, age isn’t a factor. Perhaps a family member struggles with addiction, gambling problems, or some other type of issue handling money. A spendthrift trust can provide various restrictions or incentives for how assets can be used or spent.
Here’s an example. Suppose you wish to leave $1 million to your son. If the money is left outright to him, there is no control. Alternately, in a trust, you can provide for guidance and management of his inheritance so it is mangaged, distributed, or used on his behalf at the discretion of a responsible fiduciary. The Trustee can decide on payments of distributions. The son, as a beneficiary, wouldn’t be able to spend, give away, or pledge assets as collateral. Only the Trustee can make such decisions.
You can provide for prorated income for the rest of a child’slife, without their having the ability to spend the entire amount all at once. A spendthrift trust in Santa Clarita can be created to prevent this type of waste – in other words, prevent the kids from blowing it all!
In a spendthrift trust, there will be a trustee (either another individual, an attorney, or an asset management firm) who will make decisions about how the trust assets are distributed after you pass away. By using your wishes as their guide, the trustee will make decisions about the size and timing of payments made to beneficiaries. Because the trustee will have complete control over the principal’s assets, the principal will not be able to use the trust as collateral for other purchases.
If you are establishing an estate plan and have concerns about what will happen to your assets once they are passed to the desired beneficiaries, the advice and guidance of an experienced attorney are important. At the Law Offices of Andrew Cohen, our team has a thorough understanding of the need for spendthrift trusts. We will fully explain what these trusts are and how they can benefit your situation moving forward. When you need a Santa Clarita spendthrift trust attorney, you can contact us for a free consultation of your case by clicking here or calling 661-481-0100.