As we recently discussed, there are times when you may want to disinherit someone. It is possible to do this by intentionally removing them from your estate plan. It’s best to be direct about your wishes and make sure they are clear.
However, you may find yourself wondering if you have any other options. For instance, say that you have a young beneficiary with questionable spending habits. You may consider disinheriting them, feeling that they would just waste the money, but you don’t want them to feel insulted. You also do want to leave them an inheritance. Is there any way you can do it without giving them the chance to spend the money frivolously?
Setting up a trust in their name
Often, the best solution is to create a trust with that person named as the beneficiary. You can then specify how the trust should be used or what expenditures are allowed, and appoint a trustee to make sure that this happens.
For example, maybe you believe this person will make wiser financial decisions at an older age. If they’re just 18 or 19 years old, you may simply want to stipulate that they can’t take money out of the trust until they turn 25 or 30.
But you can also just tell the trustee what types of things you would support. Maybe you’d be fine with them using the money to buy a home, start a business or go to college. You can list specific uses, and the trustee ensures that your wishes are honored.
It is important to do all of this in advance if it’s the path you want to take. Make sure you know exactly what legal options you have, by consulting an expert estate planning attorney, such as Michelle E. Smith, Esq. of Piro Zinna Cifelli Paris & Genitempo, LLC.
