Trustee Tasks Before Distributions
For individuals who create trusts for the benefit of younger beneficiaries, careful consideration must be given to the details as to how and when assets should be distributed. One option that is available is to use a staggered approach for Anaheim living trust distributions. Staggered distributions call for trust assets to be held in trust until certain pre-determined ages, life events, or dates. A portion of the trust assets are then distributed at each pre-determined time. For example, a trust may call for one-third of the assets to be distributed when a beneficiary reaches age 25, another one-third when that beneficiary reaches age 30, and the remainder to be distributed at age 35. During the times between distributions, beneficiaries can receive income that accrues on the trust assets, as well as distributions for their general care and support. This may include costs of living, healthcare, and education.
Why consider this option for the Anaheim living trust distribution scheme of your estate plan? Advantages of staggered distributions include:
- If beneficiaries are minors, the assets can be held in trust until they reach certain pre-determined ages.
- If the trust creator has educational goals for the beneficiaries, distributions can be delayed until after a certain level of schooling is finished.
- Staggered distributions give beneficiaries a “second chance” with the assets they inherit. If they make poor decisions with the money after the first distribution, there is another opportunity to handle the money in a different way after the next distribution. Ideally, the beneficiary will have gained knowledge and maturity during that time.
- Assets not distributed may retain some creditor protection. This can be beneficial if a beneficiary goes through a divorce, lawsuit, or bankruptcy during the period between or before distributions.
Options for distributions of your trust assets are nearly limitless and can be customized to suit the needs of your family. An experienced Anaheim estate planning attorney can ensure that your goals and wishes are met. For more information, contact the Law Office of James F. Roberts & Associates, APC, today at (714) 282-7488.