Trusts are a key way for people to protect their wealth and assets from generation to generation. Whether you’re looking to pass decades of wealth or perhaps a more humble sum to your kids and other relatives, trusts are effective at ensuring the money goes where you want it to go.
However, divorce can throw more than a few wrenches into this equation. How can you ensure that someone doesn’t walk off with half of what is rightfully yours and your family’s? The answer isn’t entirely straightforward, and a lot of it depends on your specific circumstances. For example, two major factors are the language and the timing used in your trust.
Revocable or Irrevocable Trust?
Revocable trusts are easier to modify and in many ways more convenient, but this also puts them at higher risk. In addition, revocable trusts can be considered marital property and could be subject to asset division, meaning your worst fears could be realized as someone else walks off with a large chunk of your family’s wealth.
Irrevocable trusts are more rigid and often locked in place or very, very difficult to modify. They are often also taxed at a higher rate. However, they are better suited for asset protection, and are not always subject to asset division like revocable trusts.
You Have Some Control Over How the Trust is Dispensed
If you limit the amount of control that your beneficiary has over the trust, this can go a long way towards ensuring that those assets are preserved. You can do things such as ensure that a third part manages the trust, as well as set funds to dispense out at specific intervals to further limit the amount of exposure to asset division and loss.
Talk to an Experienced Family Law Attorney
At the end of the day, every family’s financial situation is unique, which means that their wills, trusts and other complex assets will be configured differently for everyone. To get the advice that you need within your specific circumstances, reach out to a skilled family law attorney at your earliest convenience.
Reach us at the Law Offices of James P. White to learn more about how we can help! Call us at 925-271-0999 to schedule a initial consultation.