As Grantor of a Model Offshore Trust, you, together with your spouse (as included in the Beneficiary Class), can be first in line to receive benefits. When you need to begin drawing an income from the Trust, or if you have extraordinary expenses, simply advise the Trustee of your needs. The Trustee can wire cash directly to your local bank account.
Depending on your circumstances, it may be many years, if ever, before you need to draw on the Trust for yourself. By looking to your personal assets as a source of spendable cash, rather than drawing on the Trust prematurely, you allow the Trust Fund to grow.
The portion of the Trust Fund that remains after your lifetime will be applied for the other members of the Beneficiary Class. Dollar for dollar, it probably will be the part of your estate that contributes most to their security and well-being. The Trust Fund can be used to:
- pay educational expenses (like a private scholarship fund);
- finance a new business;
- assist a member in purchasing a home;
- make loans to a member and
- protect every member, including those not yet born, from hardship.
If there are no particular needs in a given year, the Trustee can accumulate the Trust Fund’s earnings for future use or apply them to supplement the incomes of the Beneficiaries. Your successor as Protector may consult with the Trustee on all decisions concerning the application of the Trust Fund.
Your Trust can provide Beneficiaries with financial planning machinery that literally is beyond price. A Beneficiary can use the Trust to Protect his own assets, to reduce the income tax on his own investments, and to reduce tax on his own estate. Because none of those other members is the Grantor of the Trust, he can enjoy such benefits to an even greater degree than you do.
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