This Preventive Law Alert was written by: John Goodson, Colleen Manley and Christine Goodson Forakis.

Wealth Preservation and Preventive Law Special Alerts are patterned after an annual publication to all mountain climbers called "Accidents in North American Mountaineering" which writes up all mountaineering accidents describing the accident, what caused it, how it may have been prevented so that further mountain climbing catastrophes may be avoided. Wealth Preservation and Preventive Law Special Alerts are the equivalent of "Legal Accidents in North American Law" – a description of the legal catastrophe and how it may be avoided using preventive law techniques.

Most trust drafters follow conventional wisdom and follow the pattern of unthinking predecessors – not realizing the exposure to their trust children and grandchildren.

The problem is the trusts prescribe distributions to young beneficiaries at various ages, 25, 30, 35, 40. The age requirements are the educated guesses by parents who conjure as to how and when their issue mature.

They do not realize what may happen to their children in later life and the consequences of not planning for these variations:

• At the time of the scheduled distributions, one child is in jail; one is hopelessly on drugs; one is going through a divorce; one has just been in an automobile accident and is being sued for more than $1,000,000; one is an alcoholic; one has a gambling addiction, AND YOUR TRUST PRESCRIBES THAT THE TRUSTEES MUST DISTRIBUTE A PERCENTAGE OF MONEY TO THEM
• The child is not helped and the family wealth is wasted.

Preventive law thinking requires that all family trusts be discretionary throughout their existence – leaving the distributions to your carefully selected loyal trustees who determine the optimum time and circumstances as to when to distribute to the beneficiaries – always when the coast is clear. These discretionary protective provisions prevent creditors and divorcing spouses from taking advantage and snapping up the required distributions at the prescribed ages.

For instance, if the trust says the trustees must distribute 25% of the assets set aside for the beneficiary at age 30, you end up with a catastrophe – a legal accident – the predator creditor or divorcing wife may enjoy a feeding frenzy on your family's assets. The food on your children's plate will be snapped up by unintended recipients or lost to the addictions of beneficiaries.

To help the trustees who will be making the decisions, you want to have in place a written Statement of Wishes. This document provides instructions to your trustees clarifying how they will make decisions after you die or become incapacitated. Although a written Statement of Wishes is not legally enforceable, your Trust Protector may remove double crossing trustees who are not sensitive to your wishes the same way the Senate can impeach a wayward insensitive President.

We help prevent legal accidents in North America!!

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