Parents can utilize trusts to provide for their children as part of a comprehensive estate plan. With trusts for minors, you not only provide for their financial well-being but also retain complete control over how the assets in the trust will be distributed and used by your children, empowering you to secure their future.
Creating a trust for your minor children not only provides them with security and protection but also offers you peace of mind. If you have questions about including a trust for minors in your estate plan, the Mississippi estate planning attorneys at Palmer & Slay, PLLC, are here to help. Whether you’re just beginning the estate planning process or want to add a trust, we will carefully listen to your goals and help you achieve them through careful, strategic estate planning.
The Benefits of Creating a Trust for Minors
Many benefits come from creating a trust for your minor child or children. Establishing a trust for your children may reduce the amount of estate and gift taxes your children will need to pay, allowing them to keep more of your hard-earned assets.
Building trust will also help your children avoid the Mississippi probate process. After you pass away, any assets you’ve transferred into the trust will not need to go through the probate process. Instead, your children can quickly access the funds in the trust through a trustee according to the terms of the trust agreement.
Additionally, creating a trust can help you protect your assets in the event of liability. For instance, if you’re liable in a lawsuit or have acquired financial debt, your assets could be in jeopardy. However, transferring assets into a trust for minors can protect your assets from creditors because they are no longer owned by you but by the trust. This means that even if you face financial challenges, your children’s assets will remain secure. An attorney can help you choose a type of trust that will best protect your assets in the future.
Creating a Special Needs Trust
If your child has special needs and will need special medical care, vocational training, or ongoing therapies, creating a special needs trust can help you ensure their needs are met after you pass away.
When creating the trust, you can ensure your child will receive all the care and provision they need to thrive without making them ineligible for critical public benefits, such as health insurance. Special needs trusts help individuals pay for vehicles and travel expenses, vacations, healthcare not covered by insurance benefits, clothing, and other day-to-day expenses.
Can a Trust Be Used For My Child’s Education?
Helping your child or children pay for their education is an important estate planning goal for many parents, especially as costs for higher education continue to increase. Setting up an educational trust is one of the best options to help your child meet their academic goals. You can transfer assets into a trust for educational purposes through an educational trust.
The trustee agreement should specify how the trustee should manage the assets in the trust. It should also include a clause instructing the trustee on how to use the funds in the trust. You can specify which ages or achievements your child needs to reach before they can receive disbursements from the trust.
You can also specify whether your child will receive a lump sum payment or disbursements over time. If you want your child to have enough to cover tuition and room and board each year but only those expenses, you may want to limit the yearly amount your child will receive. An estate planning attorney can help you create terms that align with your goals and help your child stay motivated to complete their educational goals.
How to Create a Trust for Your Children
Working with our skilled attorneys, who are well-versed in Mississippi trust and estate laws, can help ensure your trust has been created correctly. The provisions within the trust could cause your children more harm than good if not done properly. The first step to creating a trust for a minor is to discuss the trust with an attorney who can help you draft all necessary documents. The trust agreement should clearly state why you’ve decided to establish the trust and should state whether the trust is revocable or irrevocable.
When creating a trust, you’ll also need to select a trustee to manage the trust for your child or children’s benefits. The trustee is responsible for managing the assets in the trust, making distributions according to the terms of the trust, and ensuring the trust’s objectives are met.
Selecting a trustworthy trustee is important because you will grant them authority to decide about the trust. Some parents choose professionals, such as attorneys or financial institutions, to act as the trustee. In other cases, a parent may appoint themself as the trustee and a successor trustee who will take over responsibility for managing the trust when they pass away.
An attorney can help you include provisions in the trust documents in alignment with your goals, such as when the child should receive access to the trust funds and what should happen to the assets should the child pass away.
Once the trust has been signed in front of witnesses and a notary, the next step is to fund the trust. This involves transferring assets out of your legal name and into the trust’s name. This process ensures that the trust legally owns the assets and can be managed according to the terms of the trust agreement.
Contact an Experienced Estate Planning Attorney in Mississippi
Many benefits come from establishing a trust for your minor child or children. If you are a parent or grandparent in Mississippi and are interested in creating a minor trust, the skilled estate planning attorneys at Palmer & Slay, PLLC, are here to help you meet your goals. Don’t hesitate to contact our law firm to learn more about our comprehensive estate planning services and start the process of creating a trust for your children.
Palmer & Slay, PLLC, is dedicated to assisting clients within Mississippi, including Scott County, Rankin County, Brandon, Flowood, East Jackson, and beyond.