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Estate planning and controlling how inheritances are spent

A common concern for people in New York who are currently doing their estate planning has to do with how the money would be spent after death. There can be numerous reasons for this. Understanding the options available can help to avoid family disputes by creating a plan to achieve the desired goals.

One way to go further than a will to control how an inheritance is used is with a trust. If the plan is to control the assets after death, then it is necessary to appoint a reliable person to oversee them and distribute the funds post-death. With trusts, the determination of the distribution of assets goes beyond who gets what and adds other instructions that the beneficiaries must adhere to.

One goal might be for the beneficiary to donate a certain amount of money to charity. There could be a desire to have the beneficiary complete a college degree. It is possible that the beneficiary had a history of drug use and the testator would like him or her to take drug tests to ensure substances are no longer being used. The idea is to provide the assets at certain intervals. Any restriction is possible as long as it follows the law.

When there might be a doubt as to whether or not a certain restriction is legal, then it could be preferable to avoid restricting the way the money from the trust is spent, and instead to suggest the best ways for the beneficiary to spend the money, such as for paying the mortgage, for health care, for insurance, or for schooling. Those who wish to exert some level of control over the distribution of their estate may decide to contact an estate planning attorney for assistance.

Source: Time, 'How to Control How Heirs Spend Your Money," Kerri Renzulli, Aug. 27, 2015

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