Ezell Law Firm, LLC
Call for a free phone consultation
Local 225-763-2272 Toll free 888-511-8717
A Louisiana Full-Service Law Firm, Dedicated to Your Needs

Consider a spendthrift trust to protect against overspending

You want to leave behind assets for your children, but something that you're concerned about is that your children don't always have the best habits. One may like to gamble a lot. Another one may tend to donate almost all of her money to others, which leaves them in poor financial circumstances time and time again. They're young, but they need to know that their actions have consequences that could leave them in dire financial straits.

Your goal is to leave them money that they can't spend without thinking about the consequences. One thing you might be interested in is the spendthrift trust. A spendthrift trust is fantastic, because it's designed to protect your children from themselves. You know that getting a sudden inheritance can be a big shock, and you also know that your children may rush to spend what they receive.

What a spendthrift trust can do

With a spendthrift trust, you can add protective clauses that won't allow your children to spend the money too quickly or without thought. For example, in the spendthrift trust, you may set it up so that your older child is not able to take withdrawals directly. You could set aside that money only for education or specific expenses, like buying a home.

For your child who likes to give away and donate her assets, you could put a limitation on the amount that is paid out each month. Alternatively, you could have the trustee monitor the account and pay out only for specific, approved purchases.

Depending on your children's ages, it may also make sense to use a spendthrift trust to prevent them from using the money all at once early in life. Younger individuals may not be as cautious with their money, so you may want to consider having a trust that pays out gradually over time or that pays out only upon reaching certain milestones, such as getting married, buying a house or going to school. You can set up an age when the money pays out, too, so if you want your children to live life independently until they're 30 or 40, you could set up the trust to pay out once they reach that age.

Sometimes, it is necessary to take steps to provide continued guidance, even though you're no longer alive. With a trust like this, you can set up restrictions and requirements, so that you know that your children will be taken care of despite the fact that you can't be in control of the funds yourself.

No Comments

Leave a comment
Comment Information

Contact Our Law Firm Today

Ezell Law Firm, LLC
10761 Perkins Road
Suite A
Baton Rouge, LA 70810

Toll Free: 888-511-8717
Phone: 225-763-2272
Map & Directions

EzellBadge

Free phone consultation Contact our office to set up your appointment

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy