Reality television has given us a glimpse into the lives of the fabulously rich. While a billion-dollar estate may not be a reality for many, the concern to protect what assets exist without causing problems for your children is real. If a child suffers from addiction or is unable to properly manage their own finances, providing them with a large lump-sum inheritance may make a bad situation worse. Or, if a child is involved with a partner the parents do not like or trust, the parents will worry about the inheritance once it’s deposited into a joint account.
A popular estate planning solution is to set up a trust that can be individually tailored to meet your family’s situation. A trust is flexible and there are many varieties that should accommodate most of your concerns. You can add “incentive language” only allowing your child to inherit upon meeting certain goals, such as completing college, being drug-free or for continued employment. You can add “restrictive language” if you have concerns that a child might waste away a lump-sum payment, which allows you to determine when and how much money is distributed. Or, you can simply leave a message to your children, possibly that it is more important to live a meaningful and purposeful life than to have whatever material possessions they desire.
Reality television has taught that things rarely go as planned, unless a script is involved. Therefore, however you choose to tailor your trust, it’s best to work with an experienced attorney who can script the details of your estate plan to best ensure your wishes are carried out.