Do you plan on leaving money or assets to loved ones? If the people who will receive your inheritance struggle to manage their finances or can't do so independently, you might want to consider setting up a spendthrift trust. This system will prevent your assets from being used without the approval of a trustee. For example, children might not receive their inheritance until they're older, or adults may not receive their inheritance all at once. Before meeting with a financial advisor, review the benefits of spendthrift trusts to determine if this plan is right for you.

4 Perks of a Spendthrift Trust

1. Maintain Privacy

One of the most significant advantages of spendthrift trusts is they don't require a process of public probate. While money or assets received by beneficiaries of a will are public information, what's left in a trust will remain completely private. Discretion makes disputes over money and assets less likely. 

2. Prevent Transfer

Spendthrift trusts don't allow for the transfer, pledging, assigning, or selling of any assets or money to another party. In other words, you can feel confident that anything you leave to your beneficiaries will remain in their possession. Additionally, creditors typically cannot claim the trust principal, protecting the recipient’s funds as long as they’re in the trust. 

3. Protect Assets

If the beneficiary has unpaid debts, medical bills, or lawsuits against them, spendthrift trusts eliminate the possibility of money or assets being seized. You won't have to worry about creditors, third parties, or the government repossessing your money or property. 

4. Provide Lifetime Income 

When you establish a spendthrift trust, the beneficiary will receive money and assets over time. Rather than allowing them to spend your assets quickly, financial advisors recommend setting up a spendthrift trust to ensure they're secure for life. 

When you’re ready to set up a spendthrift trust, get in touch with Economic Strategist. These financial advisors provide business consulting, tax preparation, asset protection, and wealth management to clients throughout the Dallas-Fort Worth area of Texas. Call (214) 383-1350 to register for a seminar with a financial advisor, or visit them online to learn more about copyrighted trusts.