As a parent, few responsibilities are more important than securing your child’s future—especially in the event that something unexpected happens. One of the most effective ways to protect your child’s financial well-being is by setting up a trust.
In Missouri, a trust allows you to control how and when assets are used for your child’s benefit. Whether you’re thinking ahead for college, long-term security, or just peace of mind, here’s what you need to know.
1. Understanding What a Trust Is
A trust is a legal arrangement where:
You (the grantor) set the terms and contribute the assets
A trustee manages those assets
A beneficiary (your child) receives the benefits under the terms you’ve established
Trusts are commonly used to ensure financial resources are used responsibly, especially when a beneficiary is too young to manage money on their own.
2. Decide on the Right Type of Trust
In Missouri, there are two main types of trusts used for minor children:
Testamentary Trust: Created through your will and activated upon your death. It’s often used to manage assets left behind in an estate.
Living Trust (Revocable or Irrevocable): Created while you’re still alive and can be used to manage assets now or upon incapacity or death. This provides greater flexibility and privacy.
Your goals, family structure, and asset types will influence which type of trust is best.
3. Choose a Trustee Carefully in Missouri Child
The trustee will manage the assets and make financial decisions on your child’s behalf, so it’s critical to select someone:
Responsible and trustworthy
Financially savvy or willing to work with advisors
Willing to serve for the full duration of the trust
You may also appoint a backup trustee in case your first choice is unable or unwilling to serve.
4. Draft the Trust Document
The trust document should spell out key details, including:
The name of the grantor, trustee, and beneficiary
The purpose of the trust
Investment and spending instructions
The age or condition under which the child receives full control (e.g., age 25 or upon graduation)
Any restrictions you want in place (such as limiting use of funds to education or healthcare)
Missouri law requires that the trust be clearly written and legally executed to be enforceable.
5. Transfer Assets into the Trust
To make the trust effective, you’ll need to formally transfer ownership of assets into it. This might include:
Bank accounts
Life insurance policies (with the trust named as beneficiary)
Real estate
Investments and brokerage accounts
Each type of asset may require different paperwork to properly re-title or assign ownership to the trust.
6. Determine When the Trust Will End
You can decide when the trust terminates—usually based on age or life milestones, such as:
Turning 18 or 21 (legal adulthood)
Graduating from college
Reaching a more mature age, like 25 or 30
Some parents opt for staggered distributions (e.g., 25% at age 21, 50% at 25, the remainder at 30) to avoid giving a large sum of money all at once.
7. Seek Legal Guidance
Setting up a trust isn’t just filling out a form—it requires careful attention to detail and Missouri-specific legal requirements. A qualified estate planning attorney can:
Help you choose the best trust type
Draft a legally sound document
Ensure tax compliance
Guide you through asset transfers
Without this guidance, your trust could be challenged—or fail to achieve your intended goals.
Conclusion
Creating a trust for your minor child is a meaningful way to protect their financial future and give yourself peace of mind. Whether you’re building long-term wealth or simply planning for the unexpected, a trust gives you control, clarity, and confidence.
As a Missouri-based estate planning attorney, I’m here to help families build secure futures that honor their values and protect their loved ones. If you’re ready to take this next step in planning for your child’s future, I’m here to guide you.
Contact Chad Mann, Attorney at Law
Let’s create a custom estate plan that reflects your family’s needs and priorities. Your child’s future is worth it.
