Providing for beneficiaries is important, but you don’t want to take things too far and give them a blank check to spend at their whim. You can put together an estate plan with Morris Hall that provides for your beneficiaries but also has provisions in place to make sure they are protected from unforeseen circumstances.
I recently met with an elderly woman in Scottsdale, Arizona, who wanted to know more about establishing a family trust. She is a widow with several grandchildren and great-grandchildren. I could tell by the sound of her voice and the twinkle in her eye how much she loves them and wants to help provide for them in the future. I’m sure there is not another grandparent out there who feels any differently!
She was already providing for her beneficiaries, but she wanted to know why it is necessary to create a family trust. After all, she has taken the time to make her grandchildren and great-grandchildren the beneficiaries of most of her assets. She said that when she dies the funds will go to the children anyway, trust or not – so why pay for a trust? I then asked a few more questions about the grandchildren and it became readily apparent why it would be beneficial for her to create a trust.
She told me that while her grandchildren really do try hard to lead perfect lives, some of them are experiencing difficult times. A couple of them have either gone through or are currently going through a divorce. Some of them are trying to make it through college on tight budgets. Two of them have substance abuse problems and refuse to seek treatment. Most of them are minors and have never had to manage large sums of money before.
Once we started talking through these issues, the client began to see the benefits of establishing a Morris Hall estate plan to help provide for her beneficiaries despite the difficulties they might be experiencing. An MH trust would enable this grandmother to give specific gifts to each of her grandchildren in the form of a beneficiary trust. Each beneficiary trust can be tailored to meet the needs of the grandchild for whom it benefits.
For example, a provision can provide the minimum age that the grandchild can become his or her own trustee; or in other words, the minimum age when the grandchild can be given permission to manage his or her own funds. A provision can provide as to how a particular beneficiary’s funds should be distributed in the event that the beneficiary predeceases the grandmother. Additional provisions related to marital difficulties, substance abuse, inability to manage one’s own finances, and/or susceptibility to undue influence can also be included. In the event that a minor receives any funds, the funds within each beneficiary trust can be managed by someone else who will ensure that the temporal needs of the minor are being met, without giving the minor a “blank check” once he or she reaches 18 years of age.
The grandmother in this situation did a great job of having an initial plan in place by listing beneficiaries on her respective accounts. Some people don’t even go that far. This grandmother did something that will benefit her grandchildren and great-grandchildren for generations to come, and that was to establish an estate plan with Morris Hall. Please give us a call today if you’d like to arrange a time to discuss your family situation and determine if a similar plan is right for you. Providing for beneficiaries isn’t a difficult process when you have a properly executed estate plan in place. Contact our office at (888) 222-1328 to reach our caring staff and setup a free consultation appointment.
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