Your Trust: consider some pivotal questions

Your Trust: consider some pivotal questions beyond simply to whom you ultimately leave your assets.

Ok, we begin with a somewhat common situation for folks who need a trust. A couple want their assets to be in trust but fully available while they are both alive. Then the survivor of the two of them should have access to some or all remaining assets for their life. And finally, their family should divide those assets remaining after the passing of the second of them.

Should the survivor have access to all assets after one of them has died?

After one of you passes away, would you like the surviving spouse to have access to spend all assets of the trust? Should they have access to both principal and income of the trust? You could agree that they may access just income. You could, perhaps, agree that they can get to income and principal ,but with a maximum distribution per year.

Moreover, would the two of you like the survivor of you to still retain the ability to amend or revoke the trust? This and the question of how much of the trust the survivor of you may spend both relate to an underlying consideration. Are the two of you agreeing to preserve something to ultimately pass to family or are you more concerned that the survivor of you will need access to trust assets? And a little spoiler alert is in order: how you approach this question may change over the years. (But again, at least while both of you are alive, you may amend your trust.

How and when should remaining assets go to family?

Think about how important it is for you that you divide assets equally (for instance, among your children). And, if you would rather your trustee not distribute lump sums to your beneficiaries, would you like assets to be distributed over time? For instance, you can distribute according to the age of each beneficiary? If your beneficiaries could be younger, would you like to provide for support of children while they are minors? Are you interested in setting aside a sum for post-secondary educational needs of children or grandchildren? There are many, many possibilities to allow that you leave the legacy you intend.

After the two of you have passed away, who should be Trustee(s)?

It is no surprise that the trust will not administer itself. After the death of the second of you (and maybe even during the life of the survivor of you), it is important to have named a successor trustee. This trustee is the person who will administer your trust, according to its provisions, after you are no longer acting as trustee.

So, these are just some more-detailed things to consider when starting your estate plan. Think first about whether you want to get things in order, and what you want your legacy to be.

This is, after all, YOUR Trust: consider some pivotal questions.