What to Know About Leaving an Inheritance
Why Should I Leave an Inheritance?
Leaving an inheritance can be a selfless, sure-fire way to know that your loved ones are taken care of after you pass. We know that it’s not the most pleasing topic to have on your mind, but it’s important to be prepared and to know that you’re not leaving a single stone unturned. Planning out your inheritance can save your family an immense amount of trouble and stress if, and when, that time does come in your lives.
Did you know that, statistically, inheritances left for beneficiaries are often completely run through within about 2 years time? Of course, this isn’t the case for everyone… Leaving a designated inheritance for your children or anyone you wish to take care of can really help them achieve bigger things in life, such as paying for higher education, starting a business venture, or even as motivation to better themselves and escape from drug or alcohol dependency.
What are My Options?
There are a few things to consider with inheritances. You can keep things simple and not place any rules or restrictions, meaning the beneficiary would be able to access it indiscriminately. An alternative to this would be to set up an incentive trust. What this means is that you would be able to set rules and restrictions about the money the beneficiary receives, and even though you won’t be present you can still ensure that the inheritance is used in a manner that you deem appropriate.
You Can Still Have Control
You can be specific with the rules and restrictions that you set up for the trust.
For example, if you want to provide academic motivation for the beneficiary, you can set restrictions to guarantee that the trust is used to pay for higher education (or even to reward excellent academic results and grades).
If you want to help the beneficiary escape from a lifestyle of drug and alcohol use, you can make it so that the trust is used for recovery and rehabilitation.
To push the beneficiary to pursue entrepreneurial goals, you can allow the trust to cover business start-up costs or even to cover the purchase of a franchise.
The point we’re trying to convey is that you can have complete, tangible control over the inheritance. Setting up rules and restrictions can help you secure some peace of mind about how things will look for your child or grandchild’s future.
Remember Though… Be Understanding
With all that being said, it is important to stay flexible when designing your trust. People change, interests and goals grow in new directions, and if you set rules that are too rigid then you may end up making things difficult in the future. It’s smart to have the beneficiaries present during conversations during the life of the process. Open communication and understanding are key, and if you keep them in mind then you’ll be able to design the best trust possible.
Rest Assured Knowing Your Assets are in Order
Our mission is to serve you. Our team is dedicated to providing compassionate counsel and effective legal representation in matters pertaining to Estate Planning, Elder Law, Probate and Trust Administration, Asset Protection Planning and much more. Call us at (561) 955-8515 for a free consultation or contact us online.