How can I make sure my grandchildren receive my estate after my children pass away?

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You have the ability to control where your assets go after you pass away. Either a will or revocable living trust allows you to designate beneficiaries to receive your estate. Frequently, parents want their assets to be distributed to their children equally at the surviving spouse’ death. However, there may be a good reason to want to control where a child’s share goes after she or he passes away.

If a child is not able to manage money, because of a disability or because the child is a spendthrift, you may want to consider having that child’s share go into a trust for the child’s benefit during the child’s lifetime. One example is a Special Needs Trust for a child that is receiving benefits or may need to qualify for benefits like Supplemental Security Income (SSI) or Medicaid in the future. Another example is sometimes referred to as a spendthrift trust. This type of trust can be used for a spendthrift child or a child that has married into a blended family. The Trustee of the trust would manage the trust assets during the child’s lifetime. The terms of the trust control the child’s access to income and principal from the trust. At the child’s death, your wishes regarding the distribution of remaining trust assets, as written in the trust, control where those assets go. This gives you the certainty of knowing that your grandchildren, or other intended beneficiaries, receive the remainder of your assets rather than being controlled by the estate planning of your child.

Before taking the step of using a trust to control a child’s share of your estate, you should consider the effect it will have on that child and her or his relationship with other siblings. You also need to consider your choices for Trustee and successor Trustee of the trust. Acting as Trustee for a sibling may not be easy. Having a professional fiduciary serve as Trustee is an option but increases the expense of managing the trust.

An experienced Estate Planning attorney can help you understand your options for controlling where your assets go at your death and beyond. Contact the Estate Planning attorneys with the Law Offices of Nay & Friedenberg in Portland, Oregon at (503) 245-0894 to set an appointment.

If you would like to learn more about trusts and other estate planning options, click here to receive our FREE Legal/Financial Planning Guide.