Every family is unique. Parents and their children in Idaho are as diverse the sands on a seashore. In helping our clients complete their Pocatello Estate Planning we often utilize an estate plan as a way of creating incentives for children. For example, we often help parents who are concerned that they have spoiled their children to the point where their children lack ambition and the ability to provide for themselves. This can happen when well-meaning parents provide financial support for their children as the children age into their adult years. When this has happened, some of the parents we work with recognize that their children have become dependent and that they will need incentives to help them develop independence and to be self-sufficient. We have helped many of our clients used their Pocatello estate planning to provide incentives for their children.
We have over 70 years’ experience helping people in Pocatello complete their estate planning. We work to customize an estate plan to fit each person’s needs. We have experience and can help you create incentives for your children to become self-sufficient. Our partners Randy Budge and Lane Erickson, and attorneys Nathan Palmer and Dave Bagley have each obtained the highest ratings possible from Martindale & Hubbell, AVVO and Justia for their estate planning expertise. When it comes to planning for your children, we are confident that we can help you. As is summarized below, there are really 3 ways you can use your Pocatello estate plan to create incentives for your children.
1. Milestone FundingOne of the best ways a parent can use their Pocatello estate planning to provide an incentive for their child is through Milestone funding. This is accomplished when a parent chooses the milestones they want their child to achieve. An example of this could be to complete a semester or a year of college with a certain GPA. Alternatively, a parent could define the milestone to be earning a degree in college, or saving a certain amount of money, or paying off a certain amount of debt. The milestone is chosen as a way of helping a child achieve a certain specific goal. When the child reaches or accomplishes the milestone the parent’s estate plan can authorize a distribution of money or other property to be made directly to that child.
Some additional examples of milestones our clients have used marriage, going on a religious mission, and/or starting a business. We have also seen clients define milestones to be purchasing a home or a business. You can customize your Pocatello estate plan so that it contains language directing an outright distribution or a matching distribution to be made to the child when the milestone is reached. This has the effect of providing clear incentives for the client’s children.
2. Staggered FundingA second option that we have helped our clients use in their estate planning to provide an incentive for their children is staggered funding. Summarized simply, staggered funding provides a distribution of money to children when they reach a certain age. An example of this is a 1/3 staggered funding option. Under this type of funding, a child receives one-third of the distribution from an estate or a Trust at certain ages such as 30, 35, and 40. The ages chosen and number of distributions that will be made are chosen by the parents.
The incentive included in a staggered funding plan is that for a defined period of time, each child must provide for themselves and become self-sufficient. When distributions are made to the child, they have already learned to depend upon themselves and not upon their parent’s money.
Parents who use this option are assured that before their children receive any money or property, they have learned to take care of themselves. When this happens distributions that are made are a bonus and not a dole. The child has the opportunity to become who they themselves want to be without relying or being influenced by their parent’s money.
3. Opportunity FundingA third type of incentive planning that can be used in your Pocatello estate plan is opportunity funding. Under this plan the person you choose as your personal representative and/or trustee uses your money to purchase an opportunity for your child rather than simply giving them money directly. For example, your personal representative and/or trustee could buy a business opportunity for your child, such as a franchise, or something similar. The incentive for your child is built right into the business. Essentially, the more successful the child makes the business through their planning, and work, the more assets and money that the child will ultimately earn.
Incentive funding as a part of your Pocatello estate plan can be effective in creating an incentive for your child to be a success. If you choose to use incentive funding, we can help you.
Enlist an Idaho Estate Planning Attorney to Help YouThere are several options in creating incentives for your children through a customized Pocatello estate plan. If you have questions about how to make distributions to your children in a way that helps them, we can help. Our Pocatello Attorneys are available to discuss your options and answer your questions at an initial consultation. Call us toll free at 877.232.6101 or 208.232.6101 for a consultation with the Racine Olson team of Estate Planning attorneys in Pocatello. You can also email us directly at racine@racinelaw.net. We will answer your questions and will help you solve your Pocatello Estate Planning problems.