One of the challenges that can stymie Ohio residents who are doing or updating their estate plans is how to protect future beneficiaries from the problems sudden wealth can present to people.
Ideally, your proposed beneficiaries will be well-equipped to manage and use the funds in the trusts you’re providing them. But that is unfortunately not always the case. In those circumstances, it’s possible to add some protective “guardrails” to your estate plan.
Would a spendthrift trust be a good fit?
For some Ohio estate planners, spendthrift trusts are ideal vehicles to disburse funds to beneficiaries at preset schedules and/or amounts. This way, the trust principal remains secure and inaccessible to all but your preselected responsible trustee.
It works well for beneficiaries who lack the fiscal management skills to oversee the trust or who may suffer from addictions or have questionable spouses, friends or associates. The funds are protected and disbursements are issued according to the terms set by the funder.
Other potential situations
Do you have a loved one who is in the medical or legal fields? If so, their chosen careers could make them far likelier than most to wind up as defendants of lawsuits. Spendthrift trusts protect the principal from being attached by the courts to satisfy settlements or judgments.
Put professionals at the helm
Selecting a trustee to oversee your beneficiary’s funds is an important decision that can have far-reaching implications. If you choose the beneficiary’s relative, it could have a negative effect on their relationship.
That’s the last thing that you want happening. By expressing your concerns and wishes with an estate planning professional, you can leave a lasting legacy for those you leave behind.
