What is a discretionary trust?
A discretionary trust is a type of legal instrument used in California disability planning law. It is designed to protect assets of people with a disability and provide them with access to those assets in a controlled way. The trust is set up by a parent or guardian and typically names the disabled individual as the beneficiary. The parent or guardian is responsible for managing the trust and deciding when and to what extent the beneficiary will be allowed to use the assets. This allows the parent or guardian to ensure that the disabled person is provided for while ensuring that the assets are used in the most beneficial way. The trust may also provide for ongoing disability-specific needs such as medical and living expenses. The trustee has complete discretion over how the assets are used, which ensures that the disabled individual will have access to available funds while avoiding the risk of misuse or fraud.
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