How a trust can allow a parent to influence loved ones lives after death.

A trust is one of the most important estate planning tools available and can be used to achieve almost any estate plan’s purpose. A trust can even be drafted with provisions to allow the settlor, or the person who creates the trust, to set conditions for the beneficiaries to meet in order to receive distributions from the trust after the settlor passes.

Recently a trust with “some strings attached” made news due to some of its stranger and oddly specific requirements of the beneficiaries. Maurice Laboz was the owner of a large real estate management firm Regal Real Estate, and when he died, he left both of his daughters $10 million each through a trust. What is interesting about this trust is that each girl can receive their full inheritance when they reach the age of 35, or sooner if the daughters meet certain conditions

For instance, one daughter can receive $500,000 when she is married, but only if the husband agrees to sign a sworn statement promising not to touch the money. The daughter will also receive $750,000 for graduating from an accredited university, and writing a paragraph about what she intends to do with the money. If either girl earns a good living by 2020, they will each receive three times the amount of their tax return. The two daughters, Marlena and Victoria, are currently 21 and 17 years old.

The conditions placed on the young ladies may seem light parenting from beyond, and that’s because it is most likely what Laboz intended. An estate plan featuring a trust can be a great way to leave behind a legacy, which in this case may be the settlor’s way of pushing his daughters to marry, receive college educations, and to work hard. A trust with a lot conditions is a way that loved ones can continue to influence their loved ones lives after death. However, these conditions can be costly to the estate as it becomes more complex for the trustee and executor to administer these tasks.

Additionally, trust that holds money for long periods of time must also pay more fees if a bank holds the trust and professional trustees are involved. For instance, a trust is required to file taxes quarterly and the principal must be invested, which means that professional investment advisors must also be paid. Therefore, a trust with many conditions for the beneficiaries should be a trust that holds a large amount of assets.

For more information on how to develop an estate plan that will leave your unique legacy behind, contact our office today at 904-685-1200.



Contact Information