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As your family grows, your estate planning needs change too. Even if you previously took the time to set up a trust, chances are good that you may need to make a few changes as time passes. One common reason for modifying an existing plan is to provide you with added control over the trust assets that are for the benefit of your children. Trusts allow parents to maintain some level of control after they have passed away. For example, if your child is in a tumultuous marriage, you may have concerns over whether the trust assets are reachable by the spouse. Fortunately, you can modify your existing estate plan at any time in order to accommodate your changing requirements and wishes.
Advantages of Keeping Control of Trust Assets
What are the advantages of modifying your Orange County trust in order to keep more control over the assets intended for your children? Following are five common examples:
- The child can still receive trust assets at the discretion of the trustee.
- As you modify your trust, you can decide when those distributions should take place. For example, you can allow distributions to pay college tuition, medical expenses, or rent.
- The child can remain the beneficiary of the trust while language is included to stop distributions in the event of a drug or alcohol relapse, thus preventing enabling of the disease and waste of trust assets.
- If you want to give control to the child in the event that no issues arise, he can be the trustee of his own trust after your die. If a creditor lawsuit, divorce, or bankruptcy is on the horizon, the child can appoint an independent trustee to protect the assets in the trust.
- You can design your trust modification to mirror your hopes and goals for your children. For example, if you want to encourage a child to attend graduate school, you can set aside funds specifically for that purpose.
To learn more about modifying your estate plan in Orange County, we encourage you to sign up for our free newsletter.