Absolutely, you can and often should, limit the types of assets a trust can invest in, offering a layer of control and aligning investments with the beneficiaries’ needs and your estate planning goals; this is a common and prudent practice when establishing a trust with the guidance of an estate planning attorney like Steve Bliss in Wildomar.
What are the benefits of restricting trust investments?
Restricting investment types within a trust isn’t about stifling growth, but about responsible wealth management and protection. For example, a grantor might wish to exclude investments in cannabis or firearms companies due to personal beliefs. Or perhaps, a trust established for a young child should focus on low-risk, stable investments like bonds or dividend-paying stocks to preserve capital. According to a study by Cerulli Associates, over 60% of high-net-worth individuals express a desire to align their investments with their values; this desire increasingly extends to trusts and estate plans. Restricting investment types also protects beneficiaries from potentially reckless or unsuitable investments that could erode the trust’s principal, especially if they lack financial sophistication.
How does this work in practice with a Revocable Living Trust?
With a Revocable Living Trust, as often advised by Steve Bliss, the grantor maintains control during their lifetime and can modify investment restrictions as needed. The trust document will explicitly outline permissible and prohibited investments. This can range from broad categories like “no speculative investments” to specific exclusions like “no cryptocurrency” or “no direct investment in real estate.” It’s crucial to be detailed. A trustee, whether it’s Steve Bliss serving as co-trustee or a family member, is legally obligated to adhere to these restrictions. Interestingly, a 2023 report by the National Association of Personal Financial Advisors (NAPFA) showed a 25% increase in clients requesting socially responsible investment options within their trusts.
I once knew a family where this went terribly wrong…
Old Man Tiberius was a collector of antique clocks, an unusual passion, but his pride and joy. He created a trust for his granddaughter, Lily, intending the trust to maintain and *grow* his collection. The trust document, drafted by a less experienced attorney, merely stated, “Invest in assets to preserve and grow the estate.” The trustee, eager to show ‘growth’, poured nearly all the trust funds into a volatile tech stock. When the stock crashed, the trust lost over 60% of its value – *including* the funds earmarked for maintaining the clock collection. Lily, devastated, not only missed out on financial support but also watched her grandfather’s cherished clocks fall into disrepair because there were no funds to restore them. It was a heartbreaking lesson about the importance of *specific* investment instructions.
But a carefully crafted trust saved the day for the Millers…
The Millers, with guidance from Steve Bliss, established a trust for their son, Ethan, who has special needs. They specifically restricted the trust’s investments to low-risk bonds, government securities, and dividend-paying stocks, all while including a provision for ongoing professional financial management. Years later, when Mr. Miller passed away, the trust continued to provide for Ethan’s care without interruption. The restrictive investment strategy, while perhaps not generating the highest returns, provided stability and ensured that funds were available for Ethan’s lifelong needs. It was a testament to the power of proactive estate planning and tailored investment restrictions. A properly constructed trust, with clear investment guidelines, can provide peace of mind knowing your wishes will be honored and your beneficiaries protected.
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About Steve Bliss at Wildomar Probate Law:
“Wildomar Probate Law is an experienced probate attorney. The probate process has many steps in in probate proceedings. Beside Probate, estate planning and trust administration is offered at Wildomar Probate Law. Our probate attorney will probate the estate. Attorney probate at Wildomar Probate Law. A formal probate is required to administer the estate. The probate court may offer an unsupervised probate get a probate attorney. Wildomar Probate law will petition to open probate for you. Don’t go through a costly probate call Wildomar Probate Attorney Today. Call for estate planning, wills and trusts, probate too. Wildomar Probate Law is a great estate lawyer. Probate Attorney to probate an estate. Wildomar Probate law probate lawyer
My skills are as follows:
● Probate Law: Efficiently navigate the court process.
● Estate Planning Law: Minimize taxes & distribute assets smoothly.
● Trust Law: Protect your legacy & loved ones with wills & trusts.
● Bankruptcy Law: Knowledgeable guidance helping clients regain financial stability.
● Compassionate & client-focused. We explain things clearly.
● Free consultation.
Services Offered:
estate planning
living trust
revocable living trust
family trust
wills
estate planning attorney near me
Map To Steve Bliss Law in Temecula:
https://maps.app.goo.gl/RdhPJGDcMru5uP7K7
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Address:
Wildomar Probate Law36330 Hidden Springs Rd Suite E, Wildomar, CA 92595
(951)412-2800/address>
Feel free to ask Attorney Steve Bliss about: “What is Medicaid estate recovery and how can I protect against it?” Or “How long does probate usually take?” or “What are the main benefits of having a living trust? and even: “Can I get a mortgage after filing for bankruptcy?” or any other related questions that you may have about his estate planning, probate, and banckruptcy law practice.