When it comes to estate planning, everyone’s needs and circumstances are different. A tool that works for one person may not be suitable for another.
A spendthrift trust is one such tool that you might consider including in your Georgia estate plan.
Understanding a spendthrift trust
A spendthrift trust is a specific type of trust that limits a beneficiary’s access to the trust principal. This limitation can protect the beneficiary’s creditors from accessing those assets or prevent the beneficiary from spending all the assets immediately after receiving them.
The trustee of a spendthrift trust has full control over the distribution of the assets. They will disburse the funds according to the instructions you have given when setting up the trust.
Deciding whether a spendthrift trust is right for you
If you have a beneficiary who has difficulty managing money or has significant debt, a spendthrift trust might be a wise choice. A spendthrift trust allows you to ensure that the beneficiary will use the assets you leave behind in a way that benefits your loved ones in the long term.
However, setting up a spendthrift trust can be complex. It requires a clear understanding of your financial situation and the needs of your beneficiaries. Plus, it requires careful drafting to ensure the trust’s terms are legally sound and fulfill your intentions.
If you have loved ones who struggle with financial management or have significant debts, including a spendthrift trust in your Georgia estate plan may help protect the assets you leave them. Be sure to carefully consider your options before making a decision.