The thought of leaving a nice inheritance for your loved ones may bring a smile to your face. However, for some, it may cause a few worry lines instead. When you take a realistic look at your heirs, do you see any who may not benefit from a lump sum inheritance? If so, can a spendthrift clause protect your heirs?
It’s part of a document, a trust for example, that protects money or property for a current or future beneficiary. A spendthrift provision may prevent the beneficiary from transferring or using the property. Typically, it also protects the property from creditors.
For example, Julia wants to leave money to her daughter, Jeannie. However, she knows that Jeannie is financially reckless and also about to divorce her husband. Julia can add spendthrift provisions to her Will and her trust that protect Jeannie’s inheritance for her.
Some of the dangers generate from the heirs themselves. The term spendthrift even means “a person who spends improvidently or wastefully.” A spendthrift heir might quickly waste a lump sum inheritance.
Other heirs may run up large debts they are unable to pay. Wills and trusts with spendthrift provisions protect your heirs from creditors. Since your heir cannot access the funds, creditors usually cannot seize them either.
Some heirs may be financially sound but work in professions at high risk for litigation. Money held by a spendthrift clause is generally protected from civil judgments.
The Florida statutes mention spendthrift provisions:
When consulting with your attorney, talk about problems your beneficiaries may face.
Do you question the need for attorney guidance with so many online resources? Because laws and regulations are complex, and because every person has a lot at risk, more people than ever are seeking professional guidance from an experienced, knowledgeable source. That helps explain the rapid growth of our firm. Whether you happened upon this website by accident or are one of the many referrals we receive from a nearly 15-year collection of satisfied clients, our staff can provide customized estate planning guidance for you. Call us. Our number: 1 (772) 218-0480