A person who drafts a trust (a grantor) can specify under which conditions assets should be distributed to a beneficiary. Regardless of the conditions you want to include in your trust, you should ensure it remains lawful and not contrary to public policy, according to Connecticut’s Probate Courts and Procedure, Chapter 802c Section 45a-499y.
Here are four examples of conditions you can have in your trust:
1. Education
You can set conditions related to education that a beneficiary must fulfill to receive distributions from the trust. For example, achieve a certain grade point average (GPA) or graduate from college. If they get a lower GPA than the one stated or fail to graduate from college, they can receive a lesser amount than what they would have if they had met the requirement.
Some trusts even specify educational institutions. A grantor may have a list of pre-approved institutions that a beneficiary should obtain education from to be funded.
2. Employment
You can require a beneficiary to secure or maintain a job before receiving funds from the trust.
3. Age
Some grantors make age-based distributions in their trust. For example, a beneficiary receives one-third of their inheritance at age 25, one-third at 30 and the remainder at 35. It’s also not uncommon for grantors to distribute a lump sum at a particular age, for instance, at 40.
4. Life events
A trust can specify at what life events a beneficiary will receive funds. Your trust can provide funds for a down payment for a home, wedding costs or starting a business.
These are a few examples of conditions you can place on your trust. If you want to know if a condition you have in mind is enforceable, consider legal guidance to eliminate the possibility of your trust being invalidated.