Nearly all Massachusetts parents likely expect to live long enough to raise their children and watch them become the adults they are meant to be. However, the reality is that none of us knows how long we will live. As loving, responsible parents, we need to put a plan into place to ensure that minor children will be taken care of in the event of death. Asset protection is a major concern for parents with minor children.
Minor children are not able to own property. Therefore, the property intended for them needs to be somehow safeguarded. Trusts can hold any property or other assets you intend to be used for the benefit of your children. The assets put into the trust are often protected from taxes, creditors and anyone else who may want to get at the assets, including an ex-spouse. As your minor children reach the age of majority, you can specify how and when they will receive distributions from the trust.
For example, you may either know or suspect that one of your children is not good with money. Controlling how they receive assets from the trust could ensure that they benefit from them for a longer period. One of the main advantages of a trust is that, so long as the provisions of the trust do not violate public policy or are illegal, its provisions can be tailored to your needs and desires.
In order for a trust to work, however, it often needs to include specific language and needs to be executed in accordance with Massachusetts law. Without consulting an attorney regarding its construction and execution, your asset protection efforts could fail. Creating a trust that is valid and enforceable from the beginning may require additional effort and expense, but it could provide you the peace of mind that your children will be taken care of if you are not around to do it yourself.