You’ve worked hard to accumulate your assets. You certainly don’t want them to be squandered away after you pass away. But this is a very real concern for many New Yorkers. It’s understandable, too, given that many individuals nowadays lack the financial planning skills to ensure the long-term protection of a large inheritance.
So, what are you to do? One option is to utilize a spendthrift trust.
What is a spendthrift trust?
It short, a spendthrift trust allows assets to be contained within a trust with only periodic and quantified disbursements being made to a named beneficiary. This means that the heir doesn’t obtain immediate access to the bulk of trust assets, and he or she may never obtain full access. This prevents the beneficiary from wasting the assets away.
But a spendthrift trust doesn’t just block a beneficiary’s access to trust assets. It can also deny an heir’s creditors from accessing the wealth within the trust. Instead, creditors can only access funds that are actually received by the beneficiary. Additionally, a spendthrift trust can be a great way to protect assets if you want to support your adult child but are concerned about the influence of your child’s spouse and how he or she will manage those assets.
Create the estate plan that is right for you
Estate planning is an entirely customizable process that is meant to suit your needs and your wishes for your estate. But we know that the process can seem complicated and confusing, and you have to ensure that you create your estate plan competently if you hope to obtain the results you desire. That’s why it’s in your and your estate’s best interests to educate yourself on your estate planning options and the law.