Estate Planning Pitfall – You’re keeping your trust a secret

Description

Abstract: Many like to keep their trusts secret because they’re worried that, otherwise, the beneficiaries might spend recklessly or neglect educational or career pursuits. But the law in many states requires trustees to disclose certain information to beneficiaries. One way to avoid the disclosure requirements is by not naming children as beneficiaries and, instead, granting someone else a power of appointment over the trust; however, the power holder is under no legal obligation to provide for the children. So it’s important that those wishing to keep a trust secret be sure to consult an attorney about the law in their state in order to explore alternative strategies.