What is a Trust and Is It Right for You? Part 2

TL/DR

A Trust is a financial agreement between someone who owns an asset and a trusted person to hold and manage that asset for them. In estate planning, a Revocable Trust is often used as a substitute for a Will, but there are many types of Trusts that accomplish different objectives. If you’re trying to decide whether you should have a Trust in your estate plan, read this two-part article.

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What’s the difference between a Marital Trust and a QTIP Trust? Are Bypass Trusts and Credit Shelter Trusts trying to accomplish the same goals? As you start learning about Trusts, you’ll learn that there are subtle differences between the Trusts that you might include in your foundational estate plan. Adding to the confusion, each lawyer has a different name for Trusts that do pretty much the same thing, and we try to provide the most common names for them.

Choosing to use a Trust in your estate plan is about being clear on your goals for how your assets should go to your loved ones. Trusts are created through a contract, and so there are a million different ways to write a contract to meet your specific goals.

This Article is divided into two parts. Part 1 is a primer on the key differentiators between Trusts. This Part 2 is a summary of the most commonly created Trusts in a foundational estate plan and their benefits.

The trusts named in this article are the ones you are most likely going to encounter when creating your foundational estate plan, which is centered on a Will or Revocable Trust and disposes of your assets when you pass away. This article does not discuss Trusts that you might create during life for wealth transfers or tax planning.

It is also important to realize that the descriptions for these Trusts are not mutually exclusive; you can use multiple adjectives to describe one Trust in your estate plan. For example, you can create a Marital Trust that is also a Spendthrift Trust.

Revocable or Living Trust

This Trust is most often used as an alternative to a Will for disposing of someone’s assets at death. It is also a great vehicle to transition the management of your financial affairs smoothly to someone whom you trust, in case you become incapacitated.

Learn more about Revocable and Irrevocable Trusts in Part 1 of this article.

Marital Trust

The Trust’s creator (“trustor”) creates this irrevocable Trust for the primary benefit of the spouse (i.e., your spouse can enjoy your assets after you have passed away). A Marital Trust is useful for someone who has a blended family, worries about elder abuse of their spouse or someone influencing their spouse to disinherit their beneficiaries, or is wealthy enough to worry about the estate and generation-skipping transfer taxes. There are many ways to design a Marital Trust, but if you also want your spouse’s inheritance to qualify for a benefit called the “unlimited marital deduction” (i.e., you could pass an unlimited amount of property to your spouse completely free of estate tax at your death), the Tax Code has stringent requirements for the design of this Trust (see “QTIP Trust” below).

QTIP Trust

The Qualified Terminable Interest Property Trust is a specific kind of Marital Trust. Its terms are properly structured to comply with the tax rules so that you can pass your property to your spouse in a trust and still benefit from the unlimited marital deduction.

One of the biggest “loopholes” under the estate tax rules is the unlimited marital deduction. This deduction allows you to pass unlimited amounts of property to your spouse (beyond the estate tax exemption of $12.92M in 2023), completely free of the estate tax.*

Not all Marital Trusts comply with these rules. For example, your Marital Trust may say that your spouse will be the only beneficiary for the rest of your spouse’s life, but if your spouse remarries, the Trust will end and your assets will pass to your other loved ones. By inserting the condition about remarriage, your Marital Trust does not comply with the tax rules. Your gift to your spouse counts toward the federal tax exemption, along with any property you pass to other non-charitable beneficiaries, and could lead to an inadvertent foot fault where your estate owes estate taxes.

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*As with all things tax, there are a lot of factors to unpack in this statement. Importantly, your spouse must be a U.S. citizen. In addition, the federal government only grants this benefit to individuals who are legally married, and not individuals in a domestic partnership, civil union, or other relationship arrangements. The fact that the unlimited marital deduction was not available for individuals in same-sex marriages performed under state law was the basis for the seminal case, U.S. v. Windsor, 570 U.S. 744 (2013). The case declared the federal law, the Defense of Marriage Act, to be unconstitutional and forced the federal government to grant the same government benefits to same-sex spouses. Those government benefits include the estate tax deduction!

Family, Bypass, or Credit Shelter Trust

This Trust goes by many names, but in essence, it is an irrevocable Trust created at your death to allow your family to engage in death tax planning.* If your estate may have a tax issue, this Trust allows your executor or trustee to use what remains of your tax exemption amount ($12.92M in 2023 at the federal level*2) and shelter those assets from future death taxes. This Trust becomes a “family bank,” where assets continue to grow and benefit a family, but no death tax will be imposed with the passing of each generation.

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*“Death taxes” in this article refers to the estate tax and generation-skipping transfer tax. These two tax regimes exist at the federal and state levels.

*2 The exemption amount may be significantly lower at the state level, and can be as low as $1M.

A/B Trusts

This term applies to estate planning for couples. It describes the most common combination of Trusts that are formed at the death of the first person who passes away: the Marital Trust (“A Trust”) and the Family Trust (“B Trust”). Your estate plan will then specify a mechanism for how your executor, trustee, or even your spouse, can allocate assets between those two Trusts.

As an additional variation on this term, if you and your spouse have a joint Trust (i.e., you created your estate plan together through one Revocable Trust), your estate plan may use A/B/C Trusts. In addition to the Marital and Family Trusts, your estate plan might create a Survivor’s Trust (read more below).

Survivor’s Trust

The Survivor’s Trust is relevant only when a couple creates a joint revocable Trust; it is the continuation of the revocable Trust once one person has passed away. With a joint Trust, the estate plan must describe where all of the couple’s assets will go – not only the deceased person’s assets, but also the survivor’s assets. Because one half of the couple is still living, the Survivor’s Trust exists to collect and hold the survivor’s assets without requiring the survivor to create a brand-new estate plan. The survivor can thus change and revoke the Survivor’s Trust as desired (but a Marital Trust or Family Trust is irrevocable).

Trust for Descendant or Trust for Issue

This type of Trust goes by many names, and often references the name of the primary beneficiary (e.g., Trust for Sara). This irrevocable Trust allows the beneficiary to enjoy the Trust assets, but without the full control that comes with owning assets in their own name. This Trust is useful for designating someone else to manage financial affairs while the beneficiary is not ready or able to handle the responsibility, ensuring that assets stay within a family, protecting an inheritance from divorce or creditors (e.g., the beneficiary’s personal debts), and planning for death taxes.

These Trusts are drafted in many different ways, and can take the form of a Holdback Trust or Special Needs Trust, as appropriate.

Holdback Trust

The primary purpose of this Trust is to “hold back” the inheritance for a younger beneficiary until the beneficiary comes of age. This irrevocable trust is meant to be a temporary vehicle and is more robust than a UTMA account in allowing the trusted person to manage the beneficiary’s finances. Usually, you will be given the opportunity to decide on which birthday the trust will end and the beneficiary should be able to receive all the assets.

Special Needs Trust

This irrevocable Trust is structured with a beneficiary who has long-term special needs in mind. The Trust usually lasts during the life of the beneficiary and preserves the beneficiary’s eligibility for government programs like Medicare. This Trust should have provisions allowing a trusted person to modify the Trust terms to optimize the Trust for the needs of that beneficiary, such as restricting certain powers, or adapting to government rules to access benefits.

Charitable Trust

This irrevocable Trust benefits a charity, and usually is created so that the gifts to the Trust qualify for a charitable deduction for income tax purposes, estate tax purposes, or both.

The second of the biggest “loopholes” in the estate tax rules is that a properly made gift to charities qualifies for an unlimited deduction (see “QTIP Trust” for the other unlimited deduction). To set up a Charitable Trust for tax planning, you must make sure that there are restrictions so that the organization cannot receive a Trust distribution unless it qualifies under the Code (usually, an organization that has maintained its 501(c)(3) status, but the estate tax rules have slight variations).

Pet Trust

This irrevocable Trust benefits pets. You would name someone to take care of the pets and to handle the finances for your pets (which may be the same person or different people). However, Pet Trusts are disfavored under the law. For example, you may be able to benefit only the pets who are alive when you pass away, and not their descendants, and the Trust’s distributions are taxed as income to the caretaker even if they are used to cover the pets’ expenses.

Spendthrift Trust or Asset Protection Trust

This Trust must be properly structured according to state law to grant the layer of protection from legal claims against the beneficiary and the creditor’s state must also respect that result. When the asset protection is respected, the Trust’s assets are considered separate from the personal assets of the beneficiary to satisfy personal claims against the beneficiary. For example, the Trust’s assets may not be considered in alimony calculations upon divorce, or the Trust’s assets cannot be forced out of the Trust to pay the debt or a monetary judgment against the beneficiary. Oftentimes, creating this Trust requires an affirmative statement in the Trust document and giving the trustee full discretion to decide when distributions can be made.

Originally published January 27, 2023, and updated on November 14, 2025.

What is a Trust and Is It Right for You? Part 1

TL/DR

A Trust is a financial agreement between someone who owns an asset and a trusted person to hold and manage that asset for them. In estate planning, a Revocable Trust is often used as a substitute for a Will, but there are many other descriptions for any single Trust such as Irrevocable, Living, Joint, Testamentary, and Grantor. If you’re trying to unpack these terms and decide whether you should have a Trust in your estate plan, read this two-part article.

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A Joint Trust, a Testamentary Trust, a Sub-Trust, a Revocable Trust (which sounds so much like “Irrevocable Trust” when said out loud)… There are so many adjectives used to describe Trusts, and it can quickly make your head spin. Once you dig deeper into these descriptive words for Trusts, you realize that many of these concepts come in pairs. Once you understand what feature of a trust is being described, and what the point of comparison is, it becomes much easier to understand the Trust’s use case.

This Article is divided into two parts. This Part 1 is a primer on the key differentiators between Trusts. Part 2 is a summary of the most commonly created Trusts in a foundational estate plan and their benefits.

Here are the ways to describe a Trust that we will explore in this article:

Every term describes a different aspect of a Trust, and they are not mutually exclusive. In fact, every Trust can be described using one of the two choices from each category above. For example, if you use a Trust as a substitute for a Will in your foundational estate plan, you likely created a Revocable, Individual, Inter Vivos, Grantor Trust (most commonly shortened to “Revocable Trust”). If a Marital Trust will be created at your death, you will be creating an Irrevocable, Individual, Testamentary, Non-Grantor Trust. Let’s unpack each of these terms.

Revocable vs Irrevocable Trusts

The Revocable Trust, as the name implies, can be undone or unwound; the person who creates the Revocable Trust can simply “revoke” or “pull back” the Trust. The Irrevocable Trust, on the other hand, is much harder to change.

The Revocable Trust is often used as an alternative for a Will. It can also be used as an alternative to LLCs or Corporations to own an asset more privately while the owner is still alive.

The Irrevocable Trust is often used to give away assets while maintaining control over how the assets are used or to protect from specific types of taxes.

For most people, the introduction to Trusts begins with their own estate planning when they have to choose between making a Will or a Trust. In this context, the type of Trust you will be considering is the Revocable Trust (also commonly called a “Living Trust”).*2

Just as you would be able to change or completely revoke a Will (in many states, you could do this by ripping the original document!), you should be able to change or completely revoke your Revocable Trust. This is important because you could change your mind over the course of your life about key terms, such as who should get what asset. While you are alive and have mental capacity, you can easily change or revoke your Revocable Trust by signing a new Trust document.

An Irrevocable Trust is much harder to change, and it becomes especially difficult to remove or add beneficiaries or modify their individual rights. You might encounter this type of Trust even when creating your foundational estate plan (for example, a Marital Trust). In most states, once the Irrevocable Trust exists, changing this Trust requires the appointment of an independent trustee (if the Trust allows for it), the agreement of all the beneficiaries, or a court action. All of these options may be expensive and may require hiring an estate planner to do it right. For this reason, you must be certain you understand what powers and benefits you are giving up when you transfer property into an Irrevocable Trust.

That being said, Irrevocable Trusts are powerful vehicles for wealth transfer and preservation because you can control how the assets will be used. When properly structured, they provide protection against death taxes and creditors, which Revocable Trusts cannot do.

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*This article is about different adjectives describing Trusts. To learn more about why you would want a Revocable Trust instead of a Will, check out the article.

*2 “Living” is also sometimes used interchangeably with “Inter Vivos” (see section on “Inter Vivos v. Testamentary Trusts”). But its most common use is to mean a Revocable Trust that is used as a substitute for a Will.

Individual vs Joint Trusts

An Individual Trust has one creator (called a “trustor,” “grantor,” or “settlor”), whereas a Joint Trust has two or more trustors. If you would like to create a Trust with someone else, be clear on why.

The most common reason to set up a joint trust is with your spouse. You already share in the management of the assets (e.g., you live in a community property state), file income taxes together, and share similar values, goals, and beneficiaries.

Income tax filings and payments may become messy if you and the other person are expected to report and pay the income taxes on the assets of the Trust (see “Grantor vs Non-Grantor Trust”) below.

For gift tax reasons (as well as introducing potential for complicated legal claims), you should also consider carefully giving your assets into a Trust that was created by someone else. For example, it may be tempting to give an inheritance to your nephew in a Trust that your parents set up for your nephew. It may be better for you to set up your own Trust to keep the Trust management straight-forward.

Inter Vivos vs Testamentary Trusts

Inter Vivos Trusts* are created during the trustor’s lifetime, whereas Testamentary Trusts are created only at the trustor’s death. This description is about the timing of when a Trust exists and can hold assets.

Inter Vivos Trusts allow the creator of the trust to transfer assets during life. Testamentary Trusts lie in wait until the creator has passed away and receive assets only then. The most common way to create a Testamentary Trust is to draft it into a Will or within another Trust (i.e., a “Sub-Trust”).

You may encounter both Inter Vivos and Testamentary Trusts when creating your foundational estate plan. For example, if you use a Revocable Trust as a substitute for a Will, you are creating an Inter Vivos Trust. In fact, it is important to transfer as much of your assets into this Trust during your life, if minimizing probate is important to you.

Your estate plan may also involve any number of Testamentary Trusts (created under your Will or your Revocable Trust) in order to specify how your assets can be used or given away after your death or to allow your loved ones to minimize future taxes. For example, you might set up a relatively short-lived Testamentary Trust called a “Holdback Trust” just so someone can help your child manage their financial affairs until your child is older.

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*This term means “among the living” in Latin, and the English translation is “Living Trust.” However, the Living Trust is now commonly associated with Revocable Trusts used as a substitute for a Will, and so “Living” has become a confusing term because you can create an Irrevocable Trust during your life.

Grantor vs Non-Grantor Trusts

If you’ve made it this far in this article, you are really well on your way to understanding the features of a Trust that are important to an estate planner. Here is one more concept, which may matter more to your CPA. Your Trust may own assets that produce income (for example, real estate that is leased). It’s important to understand who is responsible for paying income taxes for Trust assets: you or the Trust.

A Grantor Trust does not pay its own taxes; another person (usually the Trust creator) must include the Trust’s income on his, her or its tax return and pay any income taxes. A Non-Grantor Trust pays its own taxes using the tax brackets for estates and trusts, which are different from the tax brackets for individuals.

Grantor Trusts retain enough of a connection to its “owner” (or “Grantor”) under the Tax Code so that the Grantor pays the taxes. Who is an owner is determined under a complex set of tax rules, and estate planners often intentionally turn on or turn off Grantor status on the Trust; but at a minimum, the owner must still be alive.

Having a Grantor trust is beneficial if you do not want to complicate tax reporting by having the Trust file a separate tax return or you want to treat the payment of taxes as an additional annual gift to your loved ones. In addition, a Non-Grantor Trust generally pays more income taxes than an individual taxpayer on the same amount of income. This is because the trust tax brackets are “compressed”; a Trust taxpayer reaches the maximum tax rate (i.e., 37%) at a lower income than does an individual taxpayer.

How does this concept apply to your foundational estate plan? If you use a Revocable Trust as a substitute for a Will, it will be a Grantor Trust that you “own” during your lifetime. A Revocable Trust does not result in any income tax savings: you must include the Trust’s income on your own tax return and pay those income taxes.

If you use a Sub-Trust (or Testamentary Trust) in your Will or Trust, that Trust will be created at your death and will usually be a Non-Grantor Trust. It will have to file and pay its own income taxes.

If you’re ready to get started creating a Revocable Trust follow this link.

To learn more about specific types of Trusts and their objectives, read Part 2 of this series.

Originally published January 24, 2023, and updated on November 14, 2025.

Everything You Need to Think About Tax Planning Before the Year’s End

No one gets married planning for divorce—but failing to plan can leave assets vulnerable. In this episode, Thomas Kopelman, Anne Rhodes, and Dave Haughton dive into why prenuptial agreements (prenups) are a key estate planning tool, not just a safeguard for the ultra-wealthy. They break down the difference between community and separate property, how prenups protect business owners, and what happens if you don’t have one in place. They also discuss post-nuptial agreements, common misconceptions, and how advisors can guide clients through these crucial conversations.

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How to Incorporate Estate Planning Into Your Practice

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Why Trust Location Matters: Exploring Tax & Asset Protection States

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Helping Clients Leave a Legacy and Facilitate a Family Meeting

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The Link Between Holistic Financial Planning and Estate Planning

Financial advisors know that the most effective client relationships are built on trust, foresight, and the ability to guide families through the full arc of their financial lives. But while investment management and retirement planning are often top of mind, estate planning is too often left siloed, delayed, or outsourced. The reality is simple: holistic financial planning and estate planning are inseparable. The bookend to any successful financial plan is an estate plan. When advisors weave them together, they unlock deeper value for clients, preserve wealth across generations, and strengthen long-term client relationships.

What Holistic Financial Planning Really Means

Holistic financial planning looks beyond accounts and performance metrics to encompass every part of a client’s financial life. It integrates:

Cash flow and budgeting to sustain daily stability.
Tax strategies that optimize lifetime outcomes.
Retirement planning to ensure longevity of resources.
Insurance and risk management to guard against disruptions.
Investment management to build a portfolio that aligns with the client’s goals.
Education and legacy goals to prepare for the future.
Estate planning to secure the client’s wishes for wealth transfer.

At its core, holistic planning means aligning money with purpose. It asks: What matters most to this client, and how should their wealth serve those priorities?

The Role of Estate Planning

Estate planning is the capstone of comprehensive wealth management. It ensures that assets are managed and distributed in accordance with a client’s wishes, both during life and after death. Common tools include wills, trusts, powers of attorney, healthcare directives, and beneficiary designations. But beyond documents, estate planning provides clarity. It minimizes conflict, protects against unnecessary taxation, and communicates a client’s legacy intentions clearly to heirs and charities.

Even the most thoughtful financial plan can fall short if a client’s legacy wishes are trapped in probate. Without the right estate planning in place, wealth can become tangled in delays, legal fees, and family disputes. What was carefully built over decades risks being lost or diminished in transition.

For advisors, estate planning is not a separate service but a critical extension of the financial plan. Without it, all the work put into growing and protecting wealth risks unraveling at the moment it matters most.

Why Advisors Must Bridge the Two

Holistic financial planning and estate planning share the same objective: maximizing financial well-being while preserving a client’s values. When these processes operate in silos, critical details fall through the cracks and clients ultimately miss out.

Advisors are uniquely positioned to bridge the gap. Unlike attorneys, CPAs, or insurance specialists who each see only one piece of the puzzle, advisors maintain the full picture with investments, taxes, retirement, cash flow, and more. Often, they have walked alongside clients for years, if not decades, building deep trust and understanding.

This vantage point makes the advisor the natural quarterback. They can anticipate how estate planning choices will ripple across a client’s broader financial life, coordinate among attorneys, CPAs, and insurance professionals, and ensure consistency across disciplines. Most importantly, they keep the client’s long-term goals and legacy intentions at the center of every decision, so that wealth not only grows but transfers in alignment with the client’s wishes.

Advisors who integrate these disciplines create tangible advantages for their clients. Here are three standout examples:

1. Risk Mitigation and Wealth Preservation: Without thoughtful estate integration, risks emerge. A client underinsured for long-term care may have to liquidate assets intended for heirs. A lack of clear documentation may trigger probate disputes. A trust structure left unreviewed after a divorce can unintentionally exclude or include beneficiaries. Holistic planning helps advisors proactively identify these vulnerabilities and protect client wealth.

2. Tax Efficiency: Estate and income taxes can significantly erode generational wealth transfers. Coordinated planning makes tax optimization possible through strategies like annual gifting, irrevocable trusts, and charitable contributions. Advisors who bring estate planning into their process not only preserve wealth but also demonstrate measurable value to clients.

3. Seamless Adaptation to Life Events: Life rarely goes according to script. Marriage, divorce, the birth of children, the sale of a business, or even evolving philanthropic priorities can all reshape both financial and estate plans. Holistic advisors ensure estate strategies are revisited alongside financial updates, keeping the entire plan current and aligned.

Separation Comes at a Cost

When financial planning and estate planning are treated as silos, clients are exposed to inefficiencies, missed opportunities, and costly mistakes. Conflicting advice from different professionals can leave gaps. Outdated beneficiary designations may unintentionally override a carefully drafted will. Valuable tax advantages can slip through the cracks.

Most importantly, a client’s intentions may never be fully realized. Without coordination, their legacy risks being dictated by default legal frameworks instead of by thoughtful, deliberate design.

This challenge is amplified by the fact that estate planning participation remains alarmingly low. A 2024 survey found that only about 24% of American adults have a will or living trust, with even lower rates among younger clients and underrepresented demographics (Caring, 2025). Meanwhile, Baby Boomers are projected to transfer $124 trillion in wealth by 2048 (Cerulli, 2024). This unprecedented generational wealth transfer is already underway, and advisors who fail to integrate estate planning into their offering risk being left behind. Those who embrace it, however, position themselves as indispensable partners to clients and their families at the moments that matter most.

The Advisor’s Opportunity

For financial advisors, estate planning is not just about compliance or risk management; it’s a growth opportunity. By making estate planning part of your holistic process, you can:

Differentiate your practice. Few advisors provide this level of comprehensive service.
Deepen client trust. Guiding families through sensitive legacy conversations builds enduring relationships.
Retain assets across generations. By engaging heirs early through estate discussions, advisors are more likely to maintain client relationships when wealth transfers occur.
Simplify the process. Modern technology removes the barriers that once made estate planning slow, intimidating, or cost-prohibitive.

Financial Advisor Jason Oestreicher from PATH Financial Partners said, “You can’t provide any other type of value that is as impactful as estate planning. Clients aren’t going to leave you when you offer it. This isn’t just another service; it’s how you set yourself apart, retain clients, and secure the next generation.”

Estate Planning as the Capstone of Holistic Advice

Holistic financial planning without estate planning is incomplete. Financial advisors who integrate the two create durable value: protecting wealth, honoring client intentions, and ensuring financial legacies reflect what matters most.

The opportunity is clear. As trillions of dollars prepare to change hands, advisors have a responsibility, and a competitive advantage, to deliver comprehensive, unified planning.

The good news? At Wealth.com, we make estate planning not just accessible but actionable. Our platform equips advisors with the tools to seamlessly integrate estate planning into their practice, enhancing client outcomes and strengthening advisor-client relationships.

Historically, estate planning required sending clients to attorneys, often creating disjointed experiences. Today, our platform bridges the gap between holistic financial planning and estate planning, empowering advisors to provide end-to-end service without friction.

Ready to see how Wealth.com can help you bring estate planning in-house? Get started today.

Side Letters in Estate Planning: How to Provide Trustee Guidance and Flexibility

Estate planning often involves a balancing act: providing support to beneficiaries without enabling dependency, establishing firm rules while preserving flexibility, and expressing intent without sacrificing efficiency.

One tool that strikes this balance particularly well is the side letter. Though informal and typically not legally binding, a side letter accompanies a trust and provides the trustee with meaningful context into the grantor’s values, intentions, and distribution preferences.

What Is a Side Letter in Estate Planning?

A side letter is a document written by the grantor to the trustee, offering personal insight that supplements the formal trust. Sometimes referred to as letters of intent in estate planning, these documents might express the grantor’s vision for how funds should be used, share guidance on supporting beneficiaries through key life stages, or articulate broader family values.

Think of the trust as a screenplay. It outlines the storyline, characters, and structure. The side letter, then, is like a director’s notes. It provides behind-the-scenes guidance that explains the motivation and meaning behind the plot. It gives the trustee a fuller picture of the “why” behind the “what,” helping them make decisions that stay true to the grantor’s intent.

Why Specific Distribution Provisions Can Be Problematic

Weighing Trustor’s Control vs Trustee Flexibility.

It’s tempting for clients to want very specific provisions in their trust: “Don’t give my son any money unless he graduates college,” or “distribute money to my son for wedding expenses or if my son starts a business.” While these types of provisions can technically be “hard-coded” directly into the trust, doing so can often be problematic.

Rigid language can backfire. Life changes can result in scenarios where the grantor would regret the instruction. Importantly, because the trust’s provisions are legally binding, this language opens the door for a beneficiary to sue to demand a distribution, despite the trustee’s reservations. Maybe the son starts a business instead of finishing college. Maybe the son’s business is unsuccessful, and the trustee doesn’t want to pour more money into it so that the money can be deployed more wisely elsewhere. A trust that’s too rigid may force a trustee into an outcome the grantor never intended, limiting trust distribution flexibility that could otherwise support evolving family needs.

Preserving Tax and Asset Protection Features.

Vesting discretion in the trustee to make distributions isn’t only beneficial for reacting to changing circumstances. It’s also critical for asset protection in drafting distributions and maintaining important tax advantages. Many asset protection and tax protection strategies require trusts to be fully discretionary, and forced distributions of trust property to beneficiaries negate those objectives. These objectives should be important to all families, not just high-net-worth families.

To ensure that a trust you set up for your beneficiary is hard to reach by that beneficiary’s creditors (including former spouses), the state law that governs the trust will require that the beneficiary have no discretion to access the trust property. One of the ways to demonstrate that the beneficiary has no access to the trust is to vest distribution decisions fully in the trustee (and appoint a trustee who is not the beneficiary). If your trust requires the trustee to distribute a certain amount to the beneficiary at the beneficiary’s request, you may be defeating the spendthrift nature of that trust.

Many wealth transfer strategies that are driven, in part, by the desire to minimize estate and generation-skipping transfer taxes require that the trustee have full discretion to distribute income and principal of the trust. This is primarily a concern for high net worth families.

The main objective is to have assets grow and accumulate any income inside the trust so that the taxable estates of the beneficiaries remain under the taxable exemption amount. The trust assets become taxable only if distributed to the beneficiary for consumption (and not to reinvest or control outside of the trust and inside the beneficiary’s taxable estate). A trust that requires the distribution of assets to the beneficiary under circumstances dictated by the trust creator may be causing more assets to be included in the taxable estate of the beneficiary than is necessary. For example, it may seem like a good idea to force a distribution of cash to the beneficiary so that he can purchase his first home. But the trust could just as well purchase the home and let the beneficiary live in the home. This way, the beneficiary can earn and accumulate his own assets (e.g., by working) without worrying that the home purchased through his parents’ assets also adds to the future estate tax burden for his own estate. This approach not only maintains protection benefits but also supports efficient tax planning in drafting distributions, ensuring that trust assets are deployed in a way that minimizes unnecessary estate tax exposure.

Increasing Drafting Cost.

Rigid distribution guidelines increase complexity and cost. The more unique provisions a trust has, the more time (and billable hours) are required to draft, review, and ultimately administer the trust.

How Side Letters Support Trustees in Estate Administration

Trustees often shoulder the burden of making difficult distribution decisions. Should they say yes to a request? Does this align with the grantor’s wishes? Would they have approved of this use?

A side letter offers helpful insight. It may share values the grantor held dear (like financial independence, philanthropy, or education) or describe how the grantor hopes the trust will help future generations. It can include specific examples, personal reflections, or reminders to be philanthropic.

Although it’s not necessarily legally binding, a well-crafted side letter can:

Reduce ambiguity in how a trustee should use discretion
Minimize family conflict by providing clarity of intent
Help the trustee make difficult decisions with greater confidence

Why Side Letters Offer Flexible, Cost-Effective Estate Planning

Incorporating a side letter allows the trust document to remain clean, flexible, and broadly discretionary. That makes it easier to use standardized trust drafting platforms or software, reducing cost and complexity. Meanwhile, the grantor’s personal vision lives in a parallel, more narrative format.

In short, where estate plans may provide flexible language, side letters allow for a place for nuance, emotion, and intent (without locking a trustee into a given course of action).

Final Thoughts: The Value of Side Letters in Estate Planning

When used appropriately, side letters can be a powerful complement to a well-drafted trust. They support trust distribution flexibility, asset protection, and long-term efficiency and help a trustee to administer a trust in line with the grantor’s intent, without sacrificing flexibility or increasing complexity.

Wealth.com’s forms are specifically drafted to address these concerns, emphasizing trustee flexibility, asset protection and tax planning. This is why we prefer for our forms to be paired with a side letter, rather than drafting bespoke distribution language directly into the trust document.

In estate planning, it’s not always about having the most rigid guardrails. Sometimes, the best guidance is a well-lit path.

The Role of an Executor

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How 9i Capital Group Uses Wealth.com to Make Estate Planning More Accessible

The Challenge: Overcoming Estate Planning Misconceptions

For years, Kevin Thompson has helped retirees navigate the complexities of financial planning. However, a common misconception among his clients was that estate planning was only for the ultra-wealthy or prohibitively expensive. Many retirees overlooked critical documents—such as medical directives, durable powers of attorney, and living wills—that could significantly impact their futures.

Estate planning at his prior firms was often cumbersome and inefficient, requiring extensive coordination with attorneys or, in some cases, being deprioritized altogether due to its complexity. Kevin knew there had to be a better way.

The Solution: Wealth.com’s Accessible and Scalable Estate Planning Platform

Kevin first discovered Wealth.com through word-of-mouth and was intrigued by its disruptive approach to estate planning. Unlike traditional estate planning solutions, Wealth.com provided:

A modern, digital-first approach to estate planning
A collaborative experience with advisors actively shaping the platform’s growth
A scalable way to provide essential estate planning services to all clients, not just those with HNW portfolios.

“I wanted to be part of an industry disruptor,” Kevin shared. “Wealth.com is moving fast, challenging the status quo, and helping advisors innovate within their practices.”

Implementation & Experience

Integrating Wealth.com into 9i Capital Group’s workflow was straightforward, as clients could complete the estate planning process at their own pace. Kevin notes, “The greatest value is the accessibility it offers—providing clients with estate planning support without the high costs typically associated with traditional partnerships.”

Key Benefits for Advisors & Clients

Wealth.com seamlessly integrates into an advisor’s workflow, ensuring that estate planning is no longer an afterthought but a fundamental part of comprehensive financial planning. By eliminating the barriers of cost and complexity, it empowers advisors to provide holistic, future-focused guidance to clients.

Affordable & Accessible: Clients can establish critical estate planning documents without high attorney fees.
Seamless Digital Experience: Clients can navigate the platform on their own timeline.
Advisors Stay in Control: Estate planning becomes an advisory-driven process, keeping advisors at the center of client conversations.

The Impact: Making Estate Planning an Essential Part of Financial Planning

Integrating Wealth.com into 9i Capital Group’s workflow was straightforward, as clients could complete the estate planning process at their own pace.

“The greatest value is the accessibility it offers—providing clients with estate planning support without the high costs typically associated with traditional partnerships.”

Looking Ahead: Estate Planning as a Must-Have for RIAs

Kevin believes Wealth.com is the future of estate planning for RIAs, aligning perfectly with the broader shift toward integrated and accessible financial services.

Estate planning is no longer a luxury reserved for the ultra-wealthy—it’s a critical component of holistic financial planning. With Wealth.com, advisors can seamlessly integrate estate planning into their practice, delivering greater value to clients while staying ahead in an evolving industry.

Kevin’s advice to other advisors: “Incorporate a fee structure within your engagement model. Wealth.com is a tool that can transform estate planning within your firm.”

Want to see how Wealth.com can elevate your practice? Schedule a demo today at wealth.com/demo.

A special thanks to Kevin Thompson for his dedication to reimagining estate planning for his clients. His commitment to client-centric solutions is helping retirees secure their legacies with greater ease and confidence.

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When Someone Goes Missing: How to Confirm a Death Without a Last Known Address

It’s the kind of estate question that’s both oddly common and incredibly difficult to answer: What if someone disappears—and no one knows if they’ve died?

A client recently faced exactly this. Her daughter, named as a beneficiary on her estranged father’s retirement account, was contacted by the financial institution holding the funds. They couldn’t locate him—and neither could she. Their question was simple but unsettling: Is he deceased? And, if so, how can she get a death certificate to move forward?

What AI Says — and Why It’s Not Enough

We posed this question to two leading AI engines. The answers pointed to familiar tools:

Social Security Death Index (SSDI)
Ancestry.com
FamilySearch.org

These are decent starting points, especially for genealogical research. But here’s a few nuances those AI tools don’t know:

SSDI is outdated. It only covers deaths reported to the Social Security Administration (SSA) and typically ends in 2014 for publicly accessible records.
The real-time data is locked away. The SSA’s modern death database—the Death Master File (DMF)—is restricted. Only “certified” institutions, such as major banks and insurers, can access it.
Even private tools like Ancestry.com rely mostly on public obituaries and grave data—not official government death records.

So What Can You Actually Do?

Check if you have any connections to “certified” entities. The National Technical Information Service (NTIS) keeps a public list of institutions certified to access the DMF. If you or your client has ties to one, they may be able to help.
Work with an attorney. Attorneys with access to legal research tools like WestLaw PeopleMap may be able to perform more sophisticated searches or petition for information directly from the SSA.
Request records from local counties. For more recent events (as opposed to genealogical searches), death records are usually held by the county where the death occurred—which is exactly the problem if the last known location is unknown. In these cases, a hired attorney can write to multiple counties or file court petitions to aid in the investigation.
Understand the time barrier. Free archival sites like FamilySearch only make death records available after several decades—typically 50 to 75 years postmortem.
Petition the court. If all else fails, and and a person has been missing for an extended period, some states allow for a court petition to have them declared legally deceased, which can serve as a substitute for a traditional death certificate. There are formal procedures to declare someone legally deceased after a period of disappearance (often 5–7 years).

The Value of Legal Insight—and Human Support

This is exactly the kind of situation where AI, while incredibly valuable, may fall short in some respects. These tools can point to public resources—but they can’t always navigate the legal gray areas, interpret the rules, or advocate on your behalf.

At Wealth.com, we bridge that gap. Our Attorney Network provides the kind of practical, real-world support financial advisors need when their clients face complex estate planning questions—especially those that require more than a database search.

Hear from a customer who recently leveraged the Attorney Network, Jared Tanimoto, CFP®, Founder & Financial Planner at Sedai Wealth:

“I actually had a great experience using Wealth.com recently with a client in Hawaii. We were setting up a trust, and as part of the process needed to retitle their home. Hawaii has a unique system called Land Court, which adds an extra layer of complexity to the titling process. Wealth.com connected both me and my client to a local Hawaii estate attorney who understood the nuances of Land Court and handled everything smoothly. The coordination was seamless, and it made the client experience feel really polished.”

Whether you’re trying to confirm a death, resolve beneficiary questions, or support a family in transition, our platform doesn’t just give you the tools—it connects you to the people who know how to use them.

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