How does a trust work to protect assets for future generations?
A trust is a legal document that allows an individual to protect their assets and designate how they will be distributed to future generations. In California, when a trust is set up, the title of the property is transferred to the trust, taking it out of the individual’s name. This means that when the individual passes away, their assets will go into the trust and be distributed based on the terms and conditions of the trust. The trust document typically contains provisions for how the assets will be managed and distributed. For example, a trust may allow for assets to be distributed to the individual’s children or grand-children over the course of their lifetime, rather than all at once. This can help ensure that the assets are protected from creditors, taxes, and other potential risks. The trust also allows the individual to decide how the assets will be distributed at the time of their death. This can include providing for the care of a beneficiary, establishing charities or non-profits, or setting up a discretionary fund to be managed by the trustees. By setting up a trust, the individual can ensure that their assets will be managed and distributed in accordance with their wishes. This can provide peace of mind that future generations are taken care of and that their assets are protected.
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