Keeping Your Assets in Your Bloodline
Without proper estate planning, your assets can easily end up in the pockets of unintended recipients.
For example, you may be planning to leave your entire estate to a daughter who happens to be married to someone whom you may not care for or trust. Simply naming your offspring as the sole beneficiary does not keep the money out of the hands of that spouse. Once assets pass to your daughter, she may deposit the assets into accounts held jointly with her spouse, which is, of course, her prerogative.
If the two should divorce later and the assets are divided, the ex-husband could end up with half of the remaining inheritance while your grandchildren, if they exist, may get considerably less.
Indeed, such a situation has unintended consequences.
So how can you set up your estate plan to ensure your assets pass to, and only to, your daughter and your grandchildren? In this instance, keeping the inheritance solely with the daughter certainly improves the chances that any remaining sum will go for the benefit of your grandchildren.
Keeping your assets within your bloodline is possible with an appropriate estate planning strategy. Working with a knowledgeable estate attorney can make this a reality.
Establishing a Bloodline Trust
Many parents think about the possible consequences of designating a married offspring as a beneficiary. However, keep in mind that 40-50% of married couples end up divorced, according to the American Psychological Association.
Situations like the one mentioned above happen all too frequently. And the thought of having your hard-earned assets go somewhere you never intended can be alarming.
A proven estate lawyer can help you create a Bloodline Trust that targets keeping your assets with only your direct blood descendants, i.e., children and grandchildren.
What is a Bloodline Trust?
A Bloodline Trust is designed to keep the inheritance you leave intact only for your children and their descendants. The Trust protects the legacy from access by your child’s spouse and others.
What Can the Bloodline Trust Be Used For?
Working with your estate lawyer, you can devise a Bloodline Trust to operate and restrict access however you wish. In most instances, the Trust is accessible only for designated reasons such as health, education, and support for children and grandchildren.
What is Restricted Access?
A Bloodline Trust cannot be accessed by sons-in-law nor daughters-in-law. If a divorce should occur, the Trust can not be considered part of any subsequent division of mutual assets and will remain entirely with your offspring.
Can Creditors Demand Payment from a Bloodline Trust?
Assets that remain in the Trust are protected from creditors and cannot be demanded as payments for debts accumulated by the son or daughter and their spouses.
Who Controls a Bloodline Trust?
In most instances, an appointed third-party Trustee should be in place to ensure proper handling of the Trust’s assets. The trustee might be a financial institution or even another family member.
If your child makes a withdrawal, the principal is to be used only for their and the children’s benefit.
Who Can Terminate the Trust?
The Trust is only revocable by you during your lifetime. Should your offspring child later pass away, the Trust will end, and the remaining assets will be distributed only the child’s direct descendants.
In New Jersey, Contact an Experienced Estate Lawyer
For issues regarding a Bloodline Trust or any other estate planning strategies, contact the Law Office of Nicholas A. Giuditta III. With over three decades of experience helping clients with developing Wills, Trusts, Advance Directives, and more, Mr. Giuditta will help you achieve peace of mind regarding the disposition of your estate.