Benefits Of A Family Trust In Florida
In 90 percent of high-net-worth families, most or all of that wealth is gone by the third generation. In some cases, the wealth is eroded because of capital gains and transfer taxes in addition to how assets are divided among the generations. Wealth can also be eroded through the generations because of a variety of business risks as well as attacks by third parties
However, it may be possible for an individual to keep his or her wealth and legacy alive for many generations by creating a family trust. Instead of simply giving a child or grandchild money for a vacation or other luxuries, the trust can be used to provide a down payment for a home or a loan to start a business. The money loaned to future generations may then be repaid into the trust to keep it solvent for the next generation.
The goal of such a trust is to provide an opportunity for future generations instead of just handing them a lump sum of money. This may help a child or grandchild complete school, make better decisions and learn to earn instead of looking for a handout. Ultimately, it can be a compromise that allows future beneficiaries to live a comfortable life without thinking of themselves as trust fund babies.
Proper trust planning may enable an individual to provide money or assets for multiple generations of beneficiaries. With the help of a lawyer, it might be possible to create trust documents that adhere to state laws and are more likely to hold up if challenged in court. Assets held in trusts often bypass probate and can be transferred immediately depending on the language in the trust itself. Therefore, they can be a convenient tool for those looking to settle their estate quickly.