An outright bequest made either through a Will, Revocable Living Trust or intestacy allows the beneficiary to directly inherit the assets—as long as he or she has reached the age of 18 in Illinois—and do with it as he or she may please. However, there are many reasons why a parent or grandparent may want to control how and when a beneficiary receives an inheritance. Whether your beneficiaries are minors and such planning is purely precautionary, your beneficiaries have given you a reason to limit their control over inheritances or you have a philosophical opposition against individuals receiving large financial windfalls too early in life, using a Revocable Living Trust to plan your estate gives you the flexibility to set the terms on which your children will inherit your estate.
First, a properly drafted Revocable Living Trust will allow the creator to establish the purposes for which the trustee may distribute assets to children—often the child’s health, support and education—and the ages at which children may withdraw the trust assets. This allows a parent to ensure that a child will be taken care of if and when the need for financial support arises but will not be able to inherit a large sum of money without any restrictions at the age of 18.
Second, a properly drafted trust will permit the trustee to delay any such withdrawals in case the beneficiary is experiencing creditor issues or involved in a divorce proceeding at the time that such withdrawal rights go into effect. Additionally, if the beneficiary has experienced drug or alcohol addiction issues in the past, the grantor may add additional restrictions on any withdrawals or distributions by the trustee while the beneficiary is undergoing treatment or suspected of continued abuse.
By utilizing a Revocable Living Trust when planning an estate, the creator can ensure that his or her wishes and concerns are made clear to the trustee and the beneficiaries and that a child’s inheritance is protected even when the child is unable to protect it him or herself.