Binghamlegal group
248-952-8783 888-794-3433

How does a spendthrift trust work?

One of the best things about planning trusts is that there are a variety of different trusts available for various needs, and you have a great deal of flexibility in customizing a trust to suit your family’s individual circumstances. If you plan on leaving a large portion of your estate to a family member you are concerned might not be equipped to handle such an inheritance, you might consider setting up a spendthrift trust. It is important that you and other Detroit residents understand how this type of trust works.

The Balance defines a spendthrift trust as one you might create for a beneficiary who might spend an inheritance all at once or who might later end up deeply in debt, thereby potentially losing the inheritance to creditors. For example, your relative might have squandered large monetary gifts you gave him or her in the past. Or, your family member may be known for maxing out credit cards, being easily deceived by fraudsters or struggling with an addiction. In any of these cases, you would have a valid reason for being concerned with how your relative handles his or her inheritance.

A spendthrift trust addresses these issues by allowing you to designate a trustee to manage the trust property. The trustee may distribute funds to your relative on a regular basis or purchase goods or services on his or her behalf with the trust funds. Because the beneficiary is not able to access the trust property on his or her own, creditors also cannot get hold of the funds. In this way, the property you leave to your loved one is largely protected and he or she is able to enjoy the inheritance for an extended time.

Trust creation takes planning, patience and knowledge. Therefore, it is important that this information not replace the advice of a lawyer.

No Comments

Leave a comment
Comment Information

proper representation is important.schedule a meeting to review your case andlearn more about how we can help you.

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

have you already made an appointment?review our address information and get driving directions to our location.

Bingham Legal Group PC
30100 Telegraph Road, Suite 360
Bingham Farms, MI 48025

Fax: 248-642-3207
Bingham Farms Law Office Map

Phone: 248 952 8783
Toll Free: 888-794-3433
Contact the Team

Review Us