It is a stereotype that beneficiaries of a trust get granted full access to its funds on their 18th birthday. However, there are many different trust types recognized in the state of Florida. Meaning, the terms and conditions for when and how trust funds are distributed may vary greatly. Read on to discover when beneficiaries are able to collect from their designated trust funds and how a seasoned Broward County trust lawyer at The Probate Lawyers can make sure this happens seamlessly.
At what time can beneficiaries collect from trust funds?
To reiterate, you may establish how and when your beneficiaries can collect the funds of your established trust within a distribution letter. Here, you may instruct for outright, staggered, or discretionary distribution. For one, outright distribution means simply giving your beneficiaries their full inheritance without any restrictions. Realistically, though, it may take your beneficiaries up to 12 to 18 months to receive these funds, as your estate’s debts and taxes must be taken care of first. Overall, this may be the best instruction if you anticipate your beneficiaries requiring financial aid immediately upon your unfortunate passing.
Secondly, staggered distributions entail you naming certain life events that may constitute allocations of funds being made. For example, you may specify that allocations cannot be made until your beneficiaries reach a certain age (i.e., usually 18, 21, or 25 years old) or otherwise achieve a certain milestone (i.e., usually graduating college or getting married). This may be best if you wish for your beneficiaries to reach physical, mental, and emotional maturity before coming into such a great deal of assets.
Lastly, discretionary distributions involve you leaving the decisions of when and how much of these funds to allocate to your beneficiaries up to the judgment of a trusted individual. Namely, this trusted individual is known as your designated trustee. This may be for the better if your beneficiaries are of a rather minor age and you cannot fully envision their life circumstances as they approach a mature age.
Who controls the distribution of a trust’s funds?
As insinuated above, your designated trustee is responsible for managing your trust’s funds and distributing them to your beneficiaries when the time is right. Specifically, at the exact time and in the exact manner you instructed within your distribution letter’s terms and conditions.
For this reason alone, you must appoint someone you can wholeheartedly rely on. This is because, in a worst-case scenario, your trustee may misappropriate the funds. This may look like making unauthorized investments with the funds; using the funds for personal loans; giving up the funds before paying off the estate’s debts and taxes; giving up the funds to the wrong beneficiaries; and more.
In conclusion, you must reflect on the gravity of the matter at hand. Once you do, you must drop everything and reach out to a competent Broward County estate lawyer at The Probate Lawyers.
