Informing a child about their trust
When parents or grandparents in South Carolina create a trust for a child, they often wonder if they should tell them about it. Many of these children won’t see the benefits of the trust for many years, but even the knowledge of the benefits may affect their behavior. The creator of the trust may have concerns that the beneficiary will lose ambition or feel entitled. Conversely, they don’t want the child to be worried about their financial future.
In some jurisdictions, the grantor doesn’t have any legal way to prevent beneficiaries from learning about a trust, even if they’re children. Some states require that beneficiaries be reasonably informed about their trusts so that they have the chance to protect their interests. They usually have the right to access an annual accounting statement. Some information may be restricted before the age of 25.
There may be legal remedies available to grantors who wish to keep beneficiaries in the dark while they are still young. Sometimes, a surrogate or trust protector can receive information in place of the child for a limited time. There are good reasons why most state laws require beneficiaries to get information about their trusts. For example, it’s important for a trustee to be held accountable for managing a trust according to the beneficiary’s best interests.
When creating a trust for a child, support and guidance from an attorney who practices in estate planning can be invaluable. They may be able to help the grantor limit the amount of information a beneficiary receives in accordance with state law. It’s their responsibility to ensure the language of the trust adheres to their client’s wishes even when they can no longer provide any input.