Transfer Wealth through Trusts
Sunday, October 4th, 2009 at 9:31 am
Transferring wealth to the next generation is a very noble goal. However, you may be hesitant to transfer wealth through a trust because you think that it may be expensive. But if you think about it thoroughly, you will realize that simply handing it over to your children or grandchildren have a lot of risks, especially if the beneficiaries are still minors.
Let’s face it - kids may sometimes be impulsive and easily influenced. So how do you give inheritance to someone who’s not mature enough to handle their own money? One way is through trusts. You will have full control because you’ll be the one to establish its terms and conditions. For example, you can make it restrictive and give the money to the beneficiary only when the right time or reasons come.
Of course you need to do a cost-benefit analysis for this purpose. It doesn’t make sense for you to create a trust if you intend to fund it with only $500. It’s not to say that $500 is not a lot of money, but just don’t make the mistake of spending three times as much in setting up a trust if you will only put $500 in it. It’s best to consult an attorney regarding this concern if you want a sound advice.
Tags: advice, attorney, beneficiary, children, control, grandchildren, inheritance, kids, trust, trusts, wealth