If You Have Young Children, You Need One of These Trusts!

There are many different types of trusts that can benefit your children, and Z Family Law can help you choose the right options for your estate plan.

Key Takeaways:

• A trust is a flexible legal tool that allows you to provide for your family, even after you have passed away.
  

• Trusts have huge benefits, including allowing your assets to reach your designated beneficiaries without having to go through probate.
  

• There are many types of trusts that can make sure your minor children are taken care of, including revocable living trusts and education trusts.

If you are a parent to young children, doing everything within your power to ensure that they have a secure future is your top priority. A thorough estate plan is always an essential step for making sure your children are protected, and you can strengthen your estate plan by including one or more types of trusts! 

At Z Family Law, we have helped many families set up secure futures for their loved ones with the help of trusts, including trusts specifically designed to benefit children. We help you familiarize yourself with your options so that you are always meeting your estate planning goals and making the choices that work best for your loved ones. 

Our latest blog walks you through the benefits of trusts and offers guidance on choosing ones that would best suit your needs in this season of raising young kids. Read on to discover more about how these trusts can make a fundamental difference for your family! 

Disclaimer: This article is current as of March, 2025 and all content is provided for informational purposes only. None of the information provided in this article, or elsewhere on this website, shall constitute or be construed as legal advice. For information specific to your individual circumstances, call us at (301) 781-7930 today. 

What Is a Trust and How Can It Benefit my Children?

A trust is a legal tool that allows you to transfer assets into possession by the trust, which is overseen by a trustee, who is also designated by you. The assets secured in the trust are then distributed to your beneficiaries based on the rules of the trust, whether that means all at once or in smaller intervals over time. 

Trusts can protect assets from going through probate when you pass away so that they can be distributed directly to beneficiaries. Additionally, trusts can ensure that assets cannot be seized by debtors or challenged by family members. In some cases, they also offer tax benefits that you can leverage in favor of your children. 

Considerations When Choosing a Trust

When you are choosing a trust, there are a few things you want to keep in mind. One such issue is that you will have to choose a trustee to manage the trust, its assets, and the dispersion of those assets. The person you choose should be someone trustworthy who is able to operate well in the position and within the parameters of the law. 

You will also have to decide what age and under what circumstances your child will be able to access the assets secured in the trust. On top of that, since each trust has different tax considerations, you should consult thoroughly with legal counsel to make sure taxes are taken into account and will not negatively affect your children’s inheritance. 

Revocable Living Trust

A revocable living trust is a classic option for parents who want to leave their assets for their children. While you are alive, you have control over the revocable living trust and the assets it contains so that you can alter anything about the trust or even eliminate it altogether at any time. 

This flexible option allows you to specify how and when your beneficiary will receive their assets–for example, it might pay out when they reach a certain age or achieve a certain milestone, such as graduating college. It can also be used to pay out a regular stipend over the course of many years.

Irrevocable Life Insurance Trust

The irrevocable life insurance trust is designed to be the beneficiary of your life insurance policy. By protecting your life insurance policy, you ensure that its proceeds will benefit your loved one rather than taking the risk that it can be claimed by debtors, taxes, or a bad faith actor who claims entitlement to it. Note that the irrevocable life insurance trust cannot be eliminated or altered after it has been arranged.

Minor’s Trust

A minor’s trust (also known as a children’s trust) is specifically designed for children under the age of 18, so naturally it is an excellent choice for your kids. With this type of trust, your assets will be managed by a trustee who can ensure that your beneficiary will receive their inheritance whenever they come of age.

To establish this trust, you do not have to design it to pay out as soon as they turn 18, but can instead choose whatever age you believe would best suit your kids and the goals you have in mind for their future–for example, this trust might be a great option if you want your child to have a successful start in life after they graduate college and move into the working world. 

Special Needs Trust

If you have a loved one who will need medical attention for the rest of their life, you can set up a special needs trust. A special needs trust allows you to support the medical care of the beneficiary without putting at risk their state-sponsored healthcare benefits. Since programs like Medicaid only allow the recipient to possess a small amount of assets, securing funds in a trust will allow your beneficiary to have access to money for hospital stays, medication, housing, and mobility devices without losing their benefits. 

Education Trust

If you want to provide for your child’s schooling, an education trust is designed to do just that! When you establish an education trust, you maintain control over the assets and the parameters of the trust. Since you set the conditions, you can ensure the funds are used for educational purposes only. You can back these trusts with a 529 Plan, which has tax advantages, allowing your beneficiary to withdraw funds without having to worry about paying extra or depreciating their savings. 

Z Family Law Can Help You Establish the Perfect Trusts for Your Family

When you are looking to create an estate plan that can benefit your children, Z Family Law has the experience and skill to help you set up the right trusts and get peace of mind. Whether you are trying to incentivize your child to make the right moves, taking care of the medical expenses of your special needs child, or providing for your child’s education, we can make sure your family’s unique goals are achieved. Reach out to schedule a free initial estate evaluation and learn more about how we can help!