We've spent a considerable amount of time on this blog discussing the various trust options available to Californians. Deciding on trust options that are right for you can be critical to the success of your estate plan, including the financial well-being of your heirs and the trust beneficiaries. This usually means that you and your heirs want to keep a close eye on how these trusts are managed, but sometimes that's not in your best interests. Sometimes, in fact, it might be wise to have absolutely no idea about how a trust is being managed.
In these instances, a blind trust may be worth consideration. As its name implies, a blind trust keeps the management of trust assets out of view of the trust's beneficiary. The main reason to do this is to avoid impressions of impropriety and self-dealing. Usually this comes up when people in power, including politicians and corporate executives, have the ability to implement changes that could would financially benefit themselves, but perhaps not the people or businesses they represent. These trusts can also be utilized by those who want to remain anonymous, such as lottery winners.
There are a number of rules that apply to the creation of these types of trusts. For example, the trustee must be independent in nature, meaning that he or she is not influenced by or affiliated with the individual who created the trust. Also, the assets within the trust must be transferable, meaning that they can be bought or sold without any interference by the trust's creator.
Deciding what to do with your assets in the event of your death can be a challenging endeavor. By learning more about the options available to you, you can ensure that you make estate planning decisions that are right for you, and that further the best interests of your estate, your heirs and any trust beneficiaries.