Why You Should Consider Setting Up a Trust for a Child
You read a lot about setting up a trust for your children, and it makes sense. Indeed someone should hold your wealth until you have an heir. But how do you set this up? In this article, we will provide advice on setting up a trust to ensure your kids are cared for when you are no longer around.
How a Trust Can Protect a Child
While most parents are concerned with providing for their children long before they die, this can be difficult as a child may not be aware that they are receiving an inheritance. It may be more prudent to leave your money to a trust; this will protect the funds and ensure that it is invested in a manner that will benefit the children of the deceased.
Setting up a trust is an option only available to a person before they die; once a trust is established, it cannot be changed by the deceased. There is also a certain amount of legal process required; this is why it is so important that all of your affairs are in order before establishing a trust.
How to Set Up a Trust for a Child
There are various ways you can set up a trust for your child. Here are some of the most common methods:
- In Your Will
Your will is one of the best places to establish trust for your child. When you include provisions for a trust in your will, you can ensure that the money is transferred efficiently. As a family lawyer will handle this, you will not have to worry about the legal aspects of the trust being set up.
When setting up a trust in your will, there are many factors to consider. Your will has to be very specific about what you want to happen to your money after you die. Furthermore, you will want to make sure that your children are specifically named as the beneficiaries of your trust.
You will also want to consider who will serve as the trustee of the trust, as this will be someone who will be in charge of managing your child’s money until they reach adulthood. If you are considering a family member to serve as a trustee, you should talk to them about this; this is a position that the trust can place a great deal of responsibility on.
You will also need to consider your state laws to ensure that your will is legal. Different states have different laws as to how much money you can leave to a child in a trust before a court must administer that trust. Your family lawyer can advise you on the laws in your state and any regulations that must be followed when you are establishing a trust.
- Trust Fund or Trust Agreement
Another possibility for establishing a trust for your child is to set up a trust fund or a trust agreement. This is a document that you or a family lawyer can create. It can be set up so that it will not go through probate; thus saving your loved ones from going to court to get the money.
This is a more involved process than establishing a trust in your will. However, the benefit is that you can be more specific in terms of how your child should use the money. This is not a process that should be taken lightly; you need to consider how the money will be used to make it an effective trust.
Build a Trust
If you are looking for ways to provide for your children’s future, a trust may be the best option for you. It is best to consult a family lawyer to get the process started.
If you’re planning to set up a trust for your children, you need a trust attorney. Estate Planning Lawyers Colorado is a reliable firm in the area to help you set up a trust for your children. Get in touch with us today!