Mullen and Iannarone, P.C.
Serving the legal needs of corporations, individuals and
families of Suffolk County since 1972

Why trusts may be better for leaving assets to children

New York residents and others may have qualms about leaving assets outright to a minor child. However, it may also be a good idea to leave assets meant for adult children in a trust. The primary reason to leave assets in a trust is that advanced age doesn't necessarily translate into advanced financial skill. As the value of an inheritance increases, it is critical that whoever oversees it has the type of financial skills necessary to manage it properly.

Even if an adult does hire a financial adviser, he or she may make a bad choice when picking someone to provide advice. Putting assets into a trust provides flexibility in how distributions are made. For instance, the trust could limit distributions to income the trust generates or choose to allow the adult child to take distributions after a certain date.

Another primary benefit of a trust is that assets are protected from creditors. The assets are also less likely to be claimed by a spouse in the event of divorce. This is because those assets are generally not considered to be part of the marital estate. Trustees can be given the power to stop distributions in the event that an adult child starts gambling or develops a problem with drugs or alcohol.

The use of trusts within an estate plan may offer a variety of benefits regardless of the beneficiary's age. It may be possible for an attorney to help a parent create a trust or review one that may already exist. Doing so may ensure that the trust is valid under state law and offers the protection that an individual desires. If necessary, a lawyer may assist in making changes to a trust to help it meet a person's needs.

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