Trust Fund Guidelines Your Attorney Can Help With


Establishing a trust fund is an ideal way to protect assets from unauthorized access and ensure that your intended beneficiary receives the money you designate for them. In fact, trust funds have many advantages that you may not realize. One of the things that makes a trust fund ideal is the fact that you can set restrictions and limitations on the recipient's access to the money. This is beneficial when you are building a fund for a child or creating a fund for a specific purpose.

Here are some of the restrictions and guidelines to discuss with your trust fund attorney.

Age Restrictions

If you are establishing a trust fund for a child, you may want to appoint a trustee who can manage the funds until your child reaches a certain age. You can set limits on the amount of money that can be spent out of the trust each year until your child reaches that age, at which point you can grant them full access to the balance. Some people stipulate that the beneficiary must be 18, while others prefer to wait until 21 or even 25 to ensure adequate maturity and reduce the risk of irresponsible spending.

Milestone Disbursements

Another way to regulate the cash flow of a trust fund is to define scheduled milestone disbursements. These disbursements would include things like a set amount upon high school graduation, certain amounts for college tuition, or a reward for college graduation. You can also set the fund to disburse a certain percentage upon marriage or the birth of their first child. When your goal is long-term financial stability, consider including an amount for a down payment on a house when they are ready to buy.

Spendthrift Management

If you have a trustee that you feel confident in who will help your beneficiary make reasonable and responsible spending decisions, you can create a spendthrift trust with the trustee designated as the final decision-maker on those expenses. That way, you have someone you can trust who will help your child navigate their trust access responsibly.

These are a few of the most important things to think about when you meet with a trust fund attorney. You can even find an attorney whose office can serve as the trustee and help your child with fund management and spending decisions. The more you understand about these services and the benefits of the right trust fund, the easier it is to see what makes it such a great choice.


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