Managing a Loved One’s Inheritance

A person can simply leave an inheritance outright to a spouse, child or other loved one. That may be fine, but could be a disaster if that loved one lacks financial sophistication, is immature, is a spendthrift or has different ultimate loved ones. In many cases, a trust for a loved one makes sense. Here are some examples:

  • You have children from a prior marriage. Will your spouse ultimately leave the assets he or she receives from you to your children?
  • Your spouse or children are not good with finances. Leaving their inheritance in trust allows your financial advisor to continue to manage investments and a trustee to ensure that the inheritance lasts for their lifetime and is well spent.
  • Your children are minors or still young (under age 30 or age 35, for example) and need assistance with their inheritance. In these cases, it is appropriate to establish an age of maturity trust for your children until they attain an age of maturity.
  • You have a child with disabilities. A special needs trust can help ensure that your child continues to receive financial support while also preserving eligibility for government benefits.