Estate Planning is a Family Affair
One of the primary purposes of estate planning is to provide for the entire family. With that in mind, some families consider setting up Family Pot Trusts. A Family Pot Trust is a trust that places property in a pool for the benefit of the entire family. If you have further questions about what type of trust is appropriate to suit your estate planning needs in California, you should consult with a Los Angeles estate planning lawyer.
A Family Pot Trust is commonly used when both parents are deceased and the trust remains for the benefit of the children. The trustee is generally allowed to distribute income, principal or both a month the beneficiaries using his or her discretion. This is called "sprinkling power." However, when setting up a Family Pot Trust for use of the family after the parents pass away it is important to consider who your trustee will be. If you appoint a trustee that has sprinkling power to distribute assets out of the estate as they see fit, this gives a substantial amount of power to the trustee. For more information about the role of a trustee, see tomorrow's blog.