The holidays have passed and you shared a lot of fun with family and friends. Was it all smooth sailing? Did everything remain calm and collective? Perhaps you have learned some new tidbits about certain relatives that cause you to second-guess certain estate planning decisions you have made. Did you joke that you might take someone out of your will and actually give it some consideration? Well, before you do anything drastic, consider some alternatives.
Your first step is to fully examine the situation – is this serious or is it perhaps a mild instance caused by an evening of excess partying and overindulgence (chocolate can have severe side effects, of course)? Did you just learn that your son’s marriage was in great jeopardy, or did your daughter-in-law simply make a sarcastic remark that you happened to overhear? Did your sister enjoy a few too many glasses of Egg Nog, or is Lindsay returning to rehab?
If you have determined that the situation deserves some serious reconsideration of your estate plan, you should next explore various options, the primary one involving a trust. In a basic plan, either in a Will or Living Trust, you often leave assets directly to a loved one after they have reached a certain age. However, when there are concerns about a family member’s ability to receive or manage an inheritance, often the answer is a trust to protect that money for life or a certain time period. An “inability” can include a pending divorce, creditor issues, substance abuse issues, or special needs. With the creation of a trust for a particular loved one, you will protect that inheritance from those outside influences or creditors for as long as the funds remain in the trust. The terms can dictate how and when the trustee makes distributions. It allows you to retain some control over the inheritance, without the worry that it gets lost to some outside party.
While a trust (either created in your Will or as part of a Living Trust) may be a useful tool for many, it may not always be the best technique for protecting an inheritance. For example, there are estates of modest size and families without a suitable trustee option where other solutions may be equally beneficial. In any event, don’t cut Lindsay out of your estate plan so hastily. Remember that the holidays can be stressful, and you should take some time to consider your alternatives.
Jennifer R. Luitjens is Certified as an Elder Law Attorney (CELA) by the National Elder Law Foundation, a non-profit organization accredited by the ABA. She lives in Jericho and practices in South Burlington with the Jarrett Law Office. This article is for informational purposes only and is not intended to constitute comprehensive or specific legal advice. The author stresses the need to engage appropriate legal and financial professionals when devising your individual estate plan.