Estate Planning as a Career

A trust is a frequently used estate-planning or asset protection instrument. Whether you plan to create a trust or are a trust beneficiary, you should be familiar with the law that governs how the trustee invests the money in the trust.

A person who creates a trust may state how s/he wants the trust invested right in the trust itself. Most trusts, however, do not contain specific investment direction because the kinds of and returns from investments change over time. If the trust is silent in that regard, there is a statute that governs the trustee known as The Prudent Investor Law.

Every trust is unique. A grandmother may create a trust to benefit her grandchildren when they reach the age of majority. A couple of retirement age may put all of their assets in a trust to provide income to them for the rest of their lives. The Prudent Investor Law requires the trustee to invest and manage trust assets as a prudent investor would by considering the purposes of the trust, the terms of the trust, the distribution requirements under the trust and other factors relevant to each particular trust. Thus, the trustee who manages the investments in the trust of the retired couple who have no income other than that produced by the trust, is required to invest very differently from the trustee who invests for the minor children in the grandmother’s trust who will get no distributions for many years.

Among other things, the trustee is required to diversify the assets in the trust, make conscious decisions about the asset allocation in light of the particular circumstances of each trust and to avoid unjustified fees and transaction costs. The trustee must also monitor the investments and reallocate the trust assets when investments are inconsistent with the investment strategy. Thus, if for example it has been determined that in view of the life ex (more…)

A trust is a frequently used estate-planning or asset protection instrument. Whether you plan to create a trust or are a trust beneficiary, you should be familiar with the law that governs how the trustee invests the money in the trust.

A person who creates a trust may state how s/he wants the trust invested right in the trust itself. Most trusts, however, do not contain specific investment direction because the kinds of and returns from investments change over time. If the trust is silent in that regard, there is a statute that governs the trustee known as The Prudent Investor Law.

Every trust is unique. A grandmother may create a trust to benefit her grandchildren when they reach the age of majority. A couple of retirement age may put all of their assets in a trust to provide income to them for the rest of their lives. The Prudent Investor Law requires the trustee to invest and manage trust assets as a prudent investor would by considering the purposes of the trust, the terms of the trust, the distribution requirements under the trust and other factors relevant to each particular trust. Thus, the trustee who manages the investments in the trust of the retired couple who have no income other than that produced by the trust, is required to invest very differently from the trustee who invests for the minor children in the grandmother’s trust who will get no distributions for many years.

Among other things, the trustee is required to diversify the assets in the trust, make conscious decisions about the asset allocation in light of the particular circumstances of each trust and to avoid unjustified fees and transaction costs. The trustee must also monitor the investments and reallocate the trust assets when investments are inconsistent with the investment strategy. Thus, if for example it has been determined that in view of the life ex (more…)

Many people do not truly understand the benefits and advantages of an irrevocable trust especially in a side by side comparison of a revocable trust. A trust is essentially a function to protect one’s assets and belongings. There are many situations and circumstances that give rise to lawsuits and ones that many people think they will never find themselves in; however, as they say, “Life is a bowl of cherries.”

Litigious circumstances arise, for instance, when and if you allow your child, who happens to be under age, to drive yet runs into a nasty accident. Or your wife or husband said she or he is leaving you and she or he wants half of everything you have. Other cases I’ve seen and heard is a business partner just quit and is taking your largest client with him; your dog just bit the mailman and the mailman is pursuing legal action against you for negligence; your son just impregnated his girlfriend and the girlfriend knows you have some money to support the child; your secretary said she was sexually harassed by her co-worker and she knows your company has the money to pay for damages.

Under the protection of an irrevocable trust, you could be sleeping much better at night knowing you are fully and comprehensively protected. You are protected and your assets are protected because you literally do not own anything. You do not own your house, your car, your investment account which holds a large sum of funds save a small checking account with, perhaps, less than two thousand dollars.

So you believe you cannot be sued? You think that you may never be sued. Certainly if you have nothing in your possession than, yes, you will most likely not be sued; however, most people have some assets of considerable value - namely, your real property. Chances then become considerably higher that you can be sued and be dragged into some litigious c (more…)