People in California often want to plan for their own financial future as well as those of their living heirs, but those with significant assets may have an interest in thinking even further into the future. California residents who want to share their wealth with future generations of children, grandchildren, great-grandchildren and even beyond will want to take the right approach to estate planning, possibly using various trusts to provide a wealth of options and possibilities for any future contingency.
It can be hard enough to plan for things that may happen years down the road, much less decades or even a century. Political turmoil, world and national financial market fluctuations and even issues like climate change and drought can lead to a lot of uncertainty for the state of the dollar and the financial state of affairs for future generations. The estate plan of today may not fit the needs of future heirs, so instead of taking a rigid and uniform approach, people may want to consider providing for a little additional flexibility in their estate plans.
Flexibility can be achieved through the use of trusts that allow for adaptation to changing beneficiary needs, changing tax laws and changing financial conditions. One strategy, known as decanting, allows for the dissolution of one kind of trust with those trust assets pouring over into another, more advantageous kind of trust. People may also want to consider a dynasty trust, which gives the trustee more discretion and the power to modify the trust under certain circumstances.
Source: Wall Street Journal “Why Estate-Planning for a Distant Future Requires Flexibility,” Anna Prior, May 4, 2015
