There are times when an adult knows that they need to set up a plan for what will happen to their assets when they die, but they’re worried that an heir will squander the inheritance. There are several options that you have for handling this type of situation.
One option you have is using a milestone or stepping stone trust that outlines when the heir can receive their distributions. This gives you some control over how and when the trust funds are distributed.
What can you include in this type of trust?
You can create specific milestones and terms that the person must meet to receive all or part of their inheritance. This can include things like turning a certain age, getting married, graduating college, or reaching certain career goals. It’s up to the creator to determine what terms should be included in the trust.
There’s still a chance that the person will squander away the proceeds of the trust. These trusts can only control the disbursement, but the person who receives it can usually do as they please.
The goal of your estate plan is to distribute your assets in the way you feel is best. Getting things set up might seem like a huge challenge at first. Working with someone familiar with these matters can help you to get everything done correctly. Once you have it done, you’ll realize that you have peace of mind since you know things are taken care of if something happens to you.
