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Giving your assets life after death

By Staff | Mar 6, 2020

Jeffrey A. Muddell

You’ve worked hard in your life. You’ve amassed a wonderful level of wealth. You are doing all the right things with your money today and planning well for the future. Great work! But then, someone tells you it’s time to have that conversation that no one likes to have – the one where you need to talk about what happens to your assets when you leave this world. Not a fun topic to consider, right?

Conducting a family meeting with an open dialogue with your loved ones about this topic is a vital first step in managing this important task. In addition, you should think about having a conversation with your trust company about how they can serve a critical role in protecting your assets after you’re gone.

A trust is a wonderful tool to help protect your assets after death for the benefit of your beneficiaries. In many cases, having an independent trust company serving as your trustee may help to ensure your administration and investment goals are met and all your carefully worded plans carried out.

The benefits are numerous, but here’s a quick look at three:

– Protection from the creditors of your beneficiaries. (bold)

After you die, there are protections afforded by the law to allow you as grantor to set up trusts for your beneficiaries that can protect your assets from your beneficiaries’ future and yet unknown creditors. This is good for your estate, but also good news for your beneficiaries.

Let me give you an example: Your daughter is a physician. If she is a defendant in a malpractice case, a trust is one of the best ways to protect your assets from her potential creditor. Now, some state laws do create variation in the extent of protection. However, the protections afforded by a properly drafted spendthrift trust created for your beneficiaries can be invaluable.

– Money management and account services. (bold)

As trustee, we are responsible for managing your assets and will care for them while continuing to grow and preserve your trust assets through careful and thoughtful management of investment portfolios after your death.

– Protection against your beneficiaries spending or pledging too much. (bold)

Are you worried your beneficiaries would burn through your inheritance too quickly? You can establish a trust to be administered after your death, directing how the trust funds may be spent for the benefit of the beneficiary.

When you have that conversation about what happens after your passing – and we encourage all families to begin or review plans for their estate – consider creating a trust and appointing an independent trustee.

Jeffrey A. Muddell is a wealth services advisor for The Sanibel Captiva Trust Company.