How a Testamentary Trust Can Help Your Beneficiaries

A testamentary trust is one of the many tools you may want to consider when planning for the future. There may be situations in which establishing a testamentary trust will be beneficial to your heirs, so speaking to an elder law attorney about this type of trust is a smart idea. At Slutsky Elder Law, we can help you write a testamentary trust and other documents that will provide for the distribution of your assets after you pass away. 

What is a Testamentary Trust?

When included in your will, a testamentary trust allows a third party, known as a trustee, to manage assets in the trust on behalf of the beneficiaries. It is important to note your will merely contains instructions for the establishment of a testamentary trust, which will not actually be established until after your passing and the probate process has been completed. Once the trust is established and assets are moved into it, the trustee will manage those funds until the time at which those assets can be distributed to the beneficiaries. 

As an example, a parent may want to place monetary assets in a testamentary trust after their death so they can be managed by a professional wealth manager until their child reaches the age of 18. Once that milestone is reached, the child can begin drawing money from the testamentary trust in accordance with the instructions written in the will.

Advantages of Establishing a Testamentary Trust

Because the actual trust is not established until after your death, the main advantage of using a testamentary trust is the flexibility it provides. If you gain or lose assets or your situation changes during your life, you can easily update your will to remove the testamentary trust or alter the instructions governing it. A testamentary trust also allows you to avoid the cost of creating a trust during your lifetime; instead, assets from your estate will be used to establish the trust after you pass away.

You may also be able to take advantage of a testamentary trust to care for your beneficiaries in specific ways. For example, if your children are close to college age when you write your will, you could establish the trust to provide only for expenses related to their college education. If your children are younger, you could use the trust to provide for their living expenses without giving them a lump sum of money at your death. 

Elder Law Attorney in Pennsylvania

If you are interested in including a testamentary trust in your will, or you need to establish any other type of trust, Slutsky Elder Law can help! With over three decades of experience as an elder law attorney, Robert Slutsky has the knowledge and expertise necessary to advise you on a range of estate planning matters and draw up the necessary documents to create a secure financial future for your heirs. Call us at (610) 940-0650 or fill out the online form on our contact page to request a consultation with an estate planning attorney in Chester County, PA, and neighboring counties.

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