This is the next article in my series on why one may or may not wish to utilize a living trust as part of their Florida estate plan. My last post discussed why a living trust can provide greater flexibility than simply having a last will and testament. The former allows one to bypass probate and to set conditions on an inheritance. No two situations are the same, however, and an experienced attorney can help with determining the best path forward for your situation. In this article, I will be discussing how a trust can be used to protect heirs from themselves. If you are in need of assistance then contact my office today to speak with a Melbourne lawyer.
Florida residents can use a living trust to place conditions on an inheritance
Using a living trust as part of an estate plan can allow one to ensure that heirs and beneficiaries meet certain requirements before they receive an inheritance. These requirements can fall under many different types. For example, one may wish for their grandchild to only receive their inheritance after they graduate from college. Under this scenario, the assets would remain in the trust while the grandchild is in school. Upon graduation, they will receive their inheritance. The trust will also typically contain a provision for what will be done with the money if the grandchild does not graduate from school within a certain amount of time. This is just one example of how such an instrument can be used to gain desired behavior from heirs.
There are many situations in which one may wish to use their trust to protect their heirs and beneficiaries from themselves. There are many situations in which a person suddenly comes into an inheritance and “goes off the rails.” Suddenly coming into large sums of money often leads to the inheritance being squandered or, worse, the feeding of addiction issues or misconduct. Utilizing a living trust can help to prevent these types of outcomes through multiple methods. First, one may wish for the heir to only receive smaller sums over time (i.e. a small monthly payment) as opposed to providing them with a large windfall. A second option would be for the heir to meet certain requirements before they inherit. These requirements could, for example, include items such as passing a certain number of drug tests over a period of time, attending Gamblers Anonymous for a period of time, obtaining mental health counseling, etc. How to best protect an heir from themselves will always depend on the specifics of the situation.
Consider the following example. Mary is a Florida resident and has three adult children. Her youngest child, who is twenty-five years old, has a history of problems involving drugs. Mary places all of her assets into a living trust and names her oldest child as the successor trustee. Mary’s living trust contains a provision that, after her death, a certain amount of money is to be put aside for the youngest child to attend a rehabilitation program. The remainder of the trust is to be divided amongst the three children, but the youngest will not receive their share until they complete rehabilitation. The trust also states that if the youngest child does not attend rehabilitation within one year of Mary’s death, then the older two children will receive the money set aside for rehab, as well as the youngest child’s inheritance.
Contact an estate planning attorney for assistance
There are a number of situations in which one may wish to place conditions on an inheritance. How to best structure a living trust will always depend on the grantor’s goal and the nature of their assets. Retaining an attorney can be a crucial step towards making sure that you are following a course that is consistent with your goals. As a Melbourne estate planning lawyer, I am able to assist with the creation of a living trust. If you are in need of assistance then contact my office online or by telephone today to schedule an initial consultation.
My firm also services Florida clients in the Brevard County cities of Titusville, Cocoa, Palm Bay, Grant, Valkaria, and Rockledge, as well as in the Indian River County areas of Fellsmere, Sebastian, Vero Beach, Indian River Shores, and Orchid. We are also able to virtually work with clients throughout the state.