Do I Need to Set Up a Separate Trust for Each of My Minor Children?Share this post
Many clients set up individual trusts for their adult children to maximize protections. But for minor children, a useful tool is the Common Trust. A common trust is a trust that benefits all the minor children together, as their needs dictate. Each of the children is treated fairly, but not necessarily equally.
For example, imagine a common trust set up for three minors: Sally (age 12), Billy (age 10), and Mary (age 4). Sally may need braces this year at a cost of $3,000, but the trustee does not have to give $3,000 to Bill and Mary to keep things equal. Billy may be constantly outgrowing his clothes and requiring new ones, but Sally and Mary do not need to receive a dollar for dollar payout to match Billy’s. Money is spent from the trust the same way you would spend it if you were still alive and taking care of your children’s individual needs.