People in different situations may need different estate planning resources. For example, those who want to leave their property primarily for their children and other close family members often think that a will is all they require. They can name beneficiaries for their assets, nominate a guardian for minor children and provide instructions about their legacy in writing. A will can serve a crucial role in many estate plans, but it doesn’t necessarily help those in special circumstances.
Some people are in challenging family situations that may require more careful consideration. For example, parents may have spent years trying to help a struggling child achieve sobriety. They may have watched in frustration as a once-promising young adult dropped out of school or repeatedly lost jobs in relationships because of their struggles with drugs or alcohol. Leaving an inheritance to someone who struggles with addiction could feed their worst habits. A trust is sometimes a way to include an addict in an estate plan without contributing to their struggles.
Trusts can limit the use of inherited resources
Wills grant assets directly to individuals, allowing them to do whatever they want. They can sell their inherited property and use the money in a self-destructive manner. Choosing to disinherit someone already struggling psychologically could cause further damage.
The choice to structure someone’s inheritance can serve as a powerful reminder that the people closest to them love them and want the best for them. A trust specifically designed for a beneficiary with a substance use disorder may have very specific terms for resource distribution.
For example, the grantor creating the trust may require that the trustee directly pay third parties for approved expenses rather than providing cash or other trust resources to a beneficiary. Additionally, it is possible to limit the use of those funds. Some people only want trust assets to go toward treatment or educational expenses. Others may earmark funds to help cover someone’s cost-of-living expenses when they struggle.
The degree of someone’s struggles and the assets someone wants to leave for them can influence the best way to structure a trust. This is just one way in which using the right estate planning tools can help those in difficult circumstances leave a meaningful legacy.