By Phillip B. Rarick, Miami Asset Protection Attorney
Let’s face it. If you have adult children, now married or considering marriage, you are a little concerned that your daughter’s husband could someday inherit your hard earned wealth. (Or maybe it’s your son’s wife.)
So, how do you protect your property, and make sure it goes to only your adult children (or your grandchildren) and not your child’s spouse?
We have proven legal strategies to address your concerns, but by far the most important is the living revocable trust. With a living trust you can create separate funds for your children and keep them in a safe haven – beyond the reach of your daughter’s or son’s spouse.
Such a trust must be properly structured to achieve this goal absent a prenuptial agreement. Specifically, it is often wise to provide that any distributions to your children are at the sole discretion of your trustee. It is also advisable to have distributions to your children paid in installments, such as at certain ages (25, 30, and 35) or maybe five installments separated by one year.
Another good strategy is to give each child the option of leaving the trust share in the trust. Once the trust funds are pulled out of the trust, they are likely to become marital property. If the funds are kept in the trust, your son or daughter has a good argument that such monies are inheritance and therefore not marital property.
Finally, a strategy that is becoming more popular is to have a specific direction in your trust that your child secure a prenuptial (or post-nuptial) agreement prior to any distribution from the trust. Of course, a nuptial agreement is not a romantic idea for your son or daughter, but, your son or daugher can always tell their fiancée, “Hey, its not my idea – it’s the crazy idea of my parent (or my parent’s crazy attorney.) For more information about why a prenuptial agreement if often a smart idea, see: Before the Wedding: Three Legal Points Every Parent Should Know
1. A properly structured living trust can create a safe haven to help make sure that your properties and assets go to your adult children – not their spouses.
2. Installment payments from your trustee to the children is often a prudent way to make sure your hard earned wealth goes only to your children – not to any in-laws (or “out-laws”).
3. For large estates, requiring each child to secure a nuptial agreement prior to marriage may be the best advice you can give your child – if they will listen!
Your comments or questions are welcome. Contact Phil Rarick, Miami asset protection attorney, at (305) 556-5209.
The information on this blog is of a general nature and is not intended to answer any individual’s legal questions. Do not rely on information presented herein to address your individual legal concerns. If you have a legal question about your individual facts and circumstances, you should consult an experienced Miami asset protection attorney. Your receipt of information from this website or blog does not create an attorney-client relationship and the legal privileges inherent therein.