When people in Ohio are creating an estate plan, they may want to consider whether their beneficiaries will be responsible with assets. It is common for people to create a trust to protect assets for their minor children, but some adult children may require a similar amount of protection. Some people may simply lack the financial education to manage the inheritance. Other individuals may have problems with overspending, gambling or substance abuse.
A trust can be created that only allows yearly distributions of a portion of the trust, such as income from investments. Distributions could be tied to a person's age or other milestones. A trustee might also be given the discretion to make distributions.
Trusts can protect assets from creditors or property division in a divorce. People should also keep in mind that a trust does not have to be a permanent arrangement. Assets can be placed in a trust to be distributed in their entirety over a period of time. A trust is not appropriate for every situation, but people should take a look at the complexity of their estates and the financial acumen of their beneficiaries and consider whether it might be the right tool.
Trusts may offer other advantages over wills, such as privacy and not having to go through the time and expense of probate. A trust can also be used in conjunction with a will. People should consider how other parts of the estate plan work with the will or trust. For example, a beneficiary designation, which is commonly used in assets like retirement accounts and insurance policies, overrides a will or a trust. People should review these documents regularly to make sure they are current and do not contradict the will or trust since they may sometimes be overlooked amid other types of estate planning.