You have worked for decades to build your wealth, and you hope to pass that legacy to your children and grandchildren when you're no longer around. However, if your adult children are married, you might have concerns about leaving them an inheritance that their spouses could potentially abuse or make off with entirely in the event of a divorce. Here are some solutions your estate planning lawyer might recommend to safeguard your married children's inheritance.
Even if you have an amicable relationship with your son-in-law or daughter-in-law, it's wise to be cautious about leaving your adult child an inheritance that their spouse could potentially take from them. A large percentage of marriages end in divorce, and you can't predict what will happen after you're gone. One way your lawyer may recommend protecting your child is by leaving their inheritance in a bloodline trust.
A trust lets you set aside funds for a specific beneficiary and even stipulate conditions for their use. If your estate planning attorney helps you set up a bloodline trust, you can stipulate that the funds in the trust go solely to your biological child and not be co-mingled with their marital assets. Even if your adult child is not yet married, you can set up a condition of the trust that requires your child to establish a premarital agreement designating their inheritance separate property. This helps ensure that if your child gets divorced, their ex-spouse won't walk away with a share of the money you intended to leave your child. In addition, funds in the trust can be exempt from alimony orders.
If you are especially worried about your child's spouse or ex-spouse misusing an inheritance, you might bypass leaving anything to your child and dedicate the trust solely to your grandchildren instead. A bloodline trust offers flexibility to ensure that funds go directly to your biological grandchildren. You can even specify how the funds should be used, such as for education or health care.
Your attorney can help you set up a trust that names your grandchild as the sole beneficiary, which means their parent, your child's spouse, would not have access to any of those funds. Establishing a responsible individual as the trustee can help ensure that your child's spouse can't manipulate your grandchild into giving them money from the trust.
If you're concerned about an in-law with an addiction or gambling problem, or you simply don't want them to benefit from your child's rightful inheritance, working with an estate planning attorney to set up a family trust can give you much-needed peace of mind.
Going through a divorce? I know how you might feel – alone, stressed out, and probably even a little sad due to the loss of the life you have always known. Whether you have children or not, you might even feel a little guilty about the break down of your relationship. But I'm here to tell you that a divorce is not the end of the world. In fact, once you get used to the idea and start to move on with your life, you may find just as much, if not more, happiness than you ever had while you were married! Getting through the proceedings of your divorce in a dignified manner is the first step, and hopefully this website will give you the insight, support, and motivation you need to get through the process as painlessly as possible.