When planning for the future, it’s natural to want your loved ones to benefit from the wealth you’ve accumulated over a lifetime. But what if the very individuals you’re trying to protect might not be ready to manage that wealth responsibly?
Whether due to financial irresponsibility, immaturity, or the risk of entering harmful relationships, there are many reasons why a beneficiary might not be prepared to handle an inheritance wisely. This is where a discretionary family trust can provide an invaluable layer of protection.
A discretionary family trust offers a unique opportunity to control not just the distribution of your assets, but also the timing and conditions under which those assets are distributed.
By placing wealth in a trust, you can avoid handing over large sums of money to beneficiaries who might not yet have the maturity or financial discipline to manage it.
For example, you can structure the trust so that distributions are made gradually, or tied to certain milestones, such as reaching a specific age, completing education, or demonstrating financial responsibility.
Why a discretionary family trust is the right choice:
- Considered decision-making: Trustees can set conditions for when assets are distributed, ensuring beneficiaries receive funds when they are ready.
- Protection from poor decisions: Trustees can prevent funds from being misused or squandered, helping protect beneficiaries from financial missteps or bad relationships.
- Adaptability: Trustees can alter distributions based on changing circumstances, ensuring your wishes are followed as your beneficiaries mature.
- Safeguarding future generations: Trusts can now run for a period of 125 years, allowing wealth to be preserved for the long term.
A discretionary family trust is an effective way to protect your loved ones from themselves, ensuring that they receive your wealth once they’re capable of handling it responsibly.
By implementing this asset planning structure now, you can guard your beneficiaries against poor financial decisions, reckless spending, and the risks of unsuitable relationships.
Achieve peace of mind by knowing your assets will be protected and distributed in a way that best supports your loved ones.
- To learn more about how a trust can protect your family, read more here, or contact our experienced legal team today.
