As parents, we work hard to provide for our children. And most of us, a whopping 77%, plan to leave an inheritance for our children – to provide for them after we’re gone. The problem is that inheritance can potentially be lost if your child divorces, files for bankruptcy, or is sued. While we don’t like to think about these types of life events for our children, they are surprisingly common.
In Georgia alone, more than 14 out of every 1,000 married adults will get a divorce. At first blush, this may not seem like a lot, but it means Georgia has one of the highest divorce rates in the United States. When it comes to bankruptcy filings, Georgia ranks in the top three states in the nation. And civil lawsuits, which are especially likely for business owners, occur more often than most of us care to admit.
In a nutshell, there are many ways a child could potentially lose their inheritance if they receive it as an outright gift. Sadly, most parents never anticipate losing their family property and hard-earned assets to unexpected life events. Most of us want our assets to stay in our family as opposed to being lost to a child’s former spouse, the government, or strangers in a lawsuit.
The good news is that there are ways to ensure your property stays in the family, no matter what.
Trusts Can Be Used to Protect Your Property From the Unexpected
A Trust is an estate planning tool that gives one party (a trustee or trustees) the right to hold assets for the benefit of a third party (the beneficiary/beneficiaries). There are a variety of forms a Trust can take, each with their own pros and cons. But, when used correctly, a Trust can protect your family’s assets from outsiders – ensuring your property is left to your desired heirs.
While once thought to be a tool for the ultra-wealthy, Trusts can be used by anyone looking to protect their assets and exercise control over their estate. Some Trusts can be designed with the added benefit of avoiding probate fees and estate taxes.
I Can Help You Protect Your Assets & Ensure Your Property Stays in the Family
As a parent I understand how important it is to plan for your child’s future. I also know we cannot always anticipate every life event our children might experience. Fortunately, estate plans can be used a tool to prepare for the unexpected, giving you much-needed peace of mind that your loved ones will be cared for, no matter what.
You have several options to preserve and protect your assets, and Trusts are only one. Schedule a free strategy session with my office to learn how you can protect your assets and provide for your children long into the future.
Parenting Tip of the Week
It’s never too early to start teaching your children about personal finance! Classic board games like Life are a great way to get young minds thinking about money and life decisions. As your children get older, offering an allowance in exchange for chores can be a great learning tool. With an allowance, you can teach your children about earning money, saving, and managing their own finances.