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The Benefits of an Incentive Trust

Recent research about inheritance trends reveals that many wealthy Americans are leery of passing along assets to children with no strings attached. Some feel that they would be taking away a child’s incentive to work, while others fear encouraging profligate behavior.

Another issue concerning parents or grandparents with significant assets to pass on to children is the ability to pass along their values as well as to how those assets should be used. Too often we hear about heirs who have spent their inheritances unwisely, leaving nothing for their later years or future generations.

This is where an incentive trust can benefit both the settlor and the beneficiary.

An incentive trust is a useful estate planning tool that will allow you to pass along some of your values as well as your assets. For example, an elder benefactor who values education can define in the trust how their assets are to be spent, such as for a college education.

If you have earned your assets through starting a company or just plain hard work, you can incentivize your children or grandchildren to do the same by leaving them assets earmarked for entrepreneurial ventures.

If you wish to pass along your charitable intentions, you can require in your incentive trust that certain assets be used to pass along gifts to charitable organizations – either ones you value or those that your heirs choose themselves.

An incentive trust fulfills the wishes of benefactors to pass along values while still providing for children or grandchildren financially.

You may also define the circumstances under which a child or grandchild can receive the assets. If you have specific desires as to how your wealth is to be used, you can specify that in an incentive trust. In addition, receiving assets through an incentive trust can be contingent upon anything – even marrying or having children.

For additional information on protecting your assets with a trust, contact our Fort Myers law firm for your free consultation.

Categories: Trusts
dorcey law firm
The Dorcey Law Firm, PLC - Fort Myers Attorney
Located at 10181 Six Mile Cypress Pkwy, Suite C, Fort Myers, FL 33966
Phone: (239) 330-6674
Local Phone: (239) 418-0169