People in Michigan who want to manage their finances both while they are living and after they have passed should have a trust. This, along with a will, can aid in estate planning and ensure finances are taking care of effectively when the owner becomes incapacitated. For those who are worried the beneficiaries will wile away the money in an irresponsible manner, a spendthrift trust is highly recommended.
CNBC stresses the importance of having a living trust. In it, the owner specifies to whom their assets shall be distributed after their death or if they become mentally unable to manage their finances. A trustee is named, and this person is in charge of making sure the wishes are followed in an efficient manner. While a trust is a great way to make sure beneficiaries are taken care of, it can be tricky with those who are not financially responsible.
In these situations, Forbes suggests adding a spendthrift provision to the trust. This type of trust is beneficial in wealthy families whose beneficiaries may not know how to manage a large amount of money appropriately. Adding a provision, which can happen upon writing the trust or through the will, helps ensure their needs are covered without giving them full access to their share of the assets right away. In this case, the trustee is given instructions about how the assets are to be distributed, whether it is via regular distributions throughout the heir's lifetime or through one lump sum once the heir reaches a certain age.