Alternatives to Creating or Managing Small Trusts

Are there alternatives available to creation or management of small trusts? Of course there are. We talk about several of the most common alternatives in this week’s podcast episode.

In the appropriate circumstances (and after good legal advice) an Arizona trustee might be able to simply terminate the trust and distribute the balance to the appropriate beneficiary or beneficiaries. Sometimes it might be advisable to look into a Uniform Transfer to Minors Act (UTMA) account. Other trustees might consider educational account arrangements (like a 529 account) for a beneficiary or, if the beneficiary is disabled, an ABLE Act account.

Be careful. Get good legal advice. But consider some of the alternatives for managing a small trust.

Even earlier than that, an individual or couple thinking about establishing a trust might consider some of those same alternatives. Creation of what might turn out to be a small trust might not be the best — or only — choice. Or the creator (settlor) of the trust might want to expressly give the trustee some flexibility. That might inlude some of the same alternatives to consider once the trust is established. Of course, the settlor of the trust might not be able to anticipate exactly what the circumstances might turn out to be later. And what seems to one person like a small trust might actually be a very substantial amount to the beneficiary or others involved.

As always, get good legal advice. And, as always, we want to make clear that our information relies on Arizona law. The rules might be different in your jurisdiction.