Many people think that they cannot protect an inheritance that they pass on to the next generation. Once they are gone, whatever risks, dangers, and life circumstances that their heirs will face can become a threat to the inherited assets.
One of the best tools to protect wealth for the next generation is setting up a Spendthrift Trust. It is a unique type of trust that can keep the family inheritance safe from the creditors, lawsuits, and risks of the beneficiaries. Ohio is one of multiple states that has a Spendthrift Trust law. Many consider Ohio's Spendthrift Trust law to be one of the most favorable to the individual.
Think of a Spendthrift Trust as a bodyguard for your heirs. A Spendthrift Trust is normally set up as an additional protection given to a beneficiary when he or she receives an inheritance. Instead of the trust directing that the beneficiary receive his or her portion outright (usually in the form of a check), the money is instead held in a certain type of a trust. A Trustee is in charge of continually monitoring and managing the trust for the beneficiary.
The main benefit of a Spendthrift Trust comes in the way it protects the inherited money. In the event a beneficiary gets in a car crash, defaults on a debt, or has a judgment issued against him or her, the beneficiary's assets would normally be at risk to satisfy the debt. However, any assets that are still held within the Spendthrift Trust would not be accessible to the creditors of the beneficiary, thereby protecting the inheritance.
Spendthrift Trusts are great tools for families who worry about dangers facing the future generation. However, the laws are very particular in what is required for a Spendthrift Trust to be effective. If you have any questions or would like to discuss protecting an inheritance for your heirs, please call The Rosenbauer Law Office, LLC today at 513-463-6789.