Most people associates the word “Trust” with exorbitant wealth while associating the word with the phrase “Trust Fund Babies”. The truth is that one of the first things I ask couples who have children up to age 30 that come to me for Wills & Estates planning is whether or not they want to include a trust in their will?
Quite simply, a trust that is in a will is known as a “testamentary trust”. The trust does not come into existence until the individual dies. At that point if there is no surviving spouse, the trust begins and whatever assets the testator or testatrix wants to be directed to the trust are deposited or placed in the trust to be overseen by a Trustee.
Contrary to most people’s belief that you only need a testamentary trust if you’re leaving your heirs an abundance of money, individuals with a net worth including retirement plans and life insurance, with more than $100,000 and children younger than 30 years of age, should definitely consider having a testamentary trust. The reasons are obvious- do you really want your 22 year old to have unfettered access to $100,000? Or, how about your10 year old?