What is a Trust Fund Baby?
The term trust fund baby brings to mind the stereotype of rich, spoiled young people who live off a trust set up by wealthy parents or a rich uncle. The stereotype is of entitled individuals with no work ethic. However, not all trust fund recipients fit this stereotype. In fact, most do not.
Rather, in most cases, parents or grandparents created a trust account to provide for their decedents, for example, money for college or a down payment on a home. Trusts allow creators (known as the grantor) to protect assets and upon their death, provide a smooth and private transfer of assets to beneficiaries. Many hardworking individuals are the beneficiary of a trust and use the proceeds with the guidance of the trustee and in keeping with the instructions of the creator of the trust.
How Does a Trust Fund Work in Naples?
Most people will use a lawyer to set up a trust For example here in Southwest Florida, they would choose Naples trust lawyer James Nici. You want a lawyer experienced in setting up trusts.
A trust is a legal arrangement set up by an individual called “the grantor.” The grantor transfers property into the trust fund to be managed by a trustee and held for the benefit of a third person, the beneficiary or “trust fund baby.” The trustee has a fiduciary role and must manage the assets with care and in the best interests of the beneficiaries.
A trust fund can hold many different types of property, including:
• Mutual Funds,
• Bonds, and
• Real Estate.
The trust can include terms that dictate how and when the trustee should distribute the trust funds. For example, the grantor can require the beneficiary to reach a certain age before they can receive funds from the trust.
Do You Need to Be Extremely Wealthy to Create a Trust Fund For Your Child in Naples?
You do not need to be very wealthy to create trust for your child or grandchild in Naples. Florida has no requirements that trust funds hold a certain amount of property. Trust funds do not need to be viewed as something your child will be able to live off their entire life. Instead, you should think of it as a tool to pass property down to later generations, no matter the amount.
There are many different kinds of trusts, ranging from relatively simple to complex. Many trusts are designed for specific purposes such as a Special Needs Trust which helps support a child or grandchild with special needs without jeopardizing their eligibility for financial assistance from the government or a Charitable Remainder Trust which allows you to leave money to your favorite charity, while still ensuring a lifetime of income for yourself, your spouse, or chilren.
What are the Benefits of Creating a Trust Fund in Naples?
Setting up a trust fund for your child or grandchild in Naples has many benefits. For example, trusts avoid probate, making the transfer of your property private, faster, and less expensive as compared to assets left through a will. Additionally, trusts can provide tax benefits and be customized to fit your unique situation.
How Do You Set Up a Trust for Your Child in Naples?
If you are interested in creating a trust for your child or grandchild, you should contact an experienced trust lawyer like James Nici. Trusts are complex legal documents that should be drafted by a professional. There are many different types of trusts, each with pros and cons. Your trust lawyer can help you decide what type is best for you and your family. They will ensure that the trust is properly drafted and legally valid.
Call Naples Trust Lawyer James Nici
If you have questions about creating a trust, you should contact the Nici Law Firm. James R. Nici is an experienced Naples attorney with almost 30 years of experience with trusts, wills, and all aspects of estate planning. He is well-versed in these issues and can create a trust to provide for your loved one. Contact our office today at (239) 449-6150 or use our web form to set up a free consultation.