Solutions 4 Financial Independence: 09/11/18

Published: Sep. 12, 2018 at 1:15 PM EDT
Email This Link
Share on Pinterest
Share on LinkedIn

Question: I want to establish a trust for my children's inheritance, do I need to pay trust frees now to accomplish this goal?

Answer (John Halterman, Beacon Wealth Management): The first thing you have to realize, is that there's going to be lots of different thrusts a person could do. One that may sound familiar to you, is one that we call a "testamentary trust." It's designed basically so that upon your death, the money goes into a trust and it's distributed based on your instructions by a trustee to your children.

Now, you've got a couple things you need to understand. Number one, you do have to pay for a trust document, so because your paying for a trust document, you're going to have to hire an estate attorney, or someone to write that. You will have to pay that fee right now for that document.

Now, in terms of the trust fees, because its not funded, meaning that they don't put the money in there until you die, there is no trust fee's while your living. Upon your death, when you pass away, the money goes into the trust, at that point the trustee is going to charge you trust fees, and they're going to manage that money and do the distribution based on your instructions. So, until then, no worries about the trustee fees, but definitely the document fee, you have to pay for in order to get it established.