Do future beneficiaries have any control of a living trust?

If there is a living trust between a couple and one partner passes away their family has to sign all the paperwork.

What control over the living trust do any of the beneficiaries have when the other partner is still living?

Also if a family member were to claim bankruptcy would any of the living trust be "in any danger to collectors or the court?"

Comments for Do future beneficiaries have any control of a living trust?

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Jul 22, 2010
It all depends on the language of the trust
by: Mo Johnson

The answer to your first question depends on the trust and what powers the trust has given the surviving partner. Sometimes trusts will set restrictions on what the surviving partner can do with trust assets in order to ensure that subsequent beneficiaries are protected. A QTIP Trust is a good example.

As to your question about bankruptcy, this again would depend on what the trust says. Normally creditors can recover assets in a bankruptcy that the bankrupt individual had control of. So, it get's down to what the trust said. This is discussed in a different context at living trust and bankruptcy.

You can see that wording of the trust is very, very important. It is possible for trusts to be used to provide some creditor protection. Particularly by selecting certain assets to go to certain beneficiaries at certain times. But, you can see how this gets complicted.

This is why we recommend people see a living trust attorney to draft their trusts.

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