Despite your best intentions, you may recognize that you have a relatively high-conflict family situation. Maybe you currently share custody of your children with your ex, and you can easily imagine them using your children’s inheritance out of spite if anything were to happen to you. Perhaps you have children who constantly get into arguments with one another and fight over the tiniest details. You may even want to leave an inheritance for your grandchildren but not your children.
There are countless family circumstances that might put your estate at elevated risk of conflict after your death. If your family members challenge your wishes and your estate ends up in probate court, the legal process might undermine your personal wishes or consume a significant portion of the assets you wanted to leave for specific people.
Adding a trust to your estate plan can benefit those in high-conflict family circumstances in two very valuable ways.
1. They reduce the likelihood of misconduct
A trustee has a fiduciary duty to the beneficiaries of the trust. They should carefully follow the instructions that you provide and also make every reasonable effort to preserve the value of the assets in the trust.
The trustee will be subject to the supervision of the probate courts and could face challenges from family members who believe they have failed to fulfill their duty. You can provide very thorough, long-term instructions about the management and distribution of your assets that can reduce or potentially eliminate the possibility of embezzlement or other misconduct damaging your legacy.
2. They help prevent probate challenges
If you leave more of an inheritance for one of your children than another, that might lead to litigation initiated by someone unhappy with your estate planning decisions.
Disinherited family members can sometimes claim that their omission from the estate documents was a mistake. They might challenge a will that excludes them and either convince the courts to uphold an earlier will or treat the estate as though there are no testamentary documents.
Those who added trust to their estate planning documents add another layer of protection against frivolous lawsuits.
Considering all of the possible estate administration pitfalls your family could face might help you see the value of adding a trust to your existing estate plan.