Wealth Counsel Estate Planning Blog: Parents want to be in dictatorial control. However, trusts must be irrevocable for estate tax and asset protection planning purposes. Many people get turned off when the word “irrevocable” is raised. We must be able to assure them that they can “have their cake and eat it too.”
Magic Formula. The goal of planning is to “own nothing and control everything.” The magic formula is “control.” “Own” looks and sounds like an English word, but it is not. It is a legally defined concept. By contrast, “control” is what it seems to be. To paraphrase U.S. Supreme Court Justice Potter Stewart, (who was describing hard core pornography), you know it (control) when you see it.
Children’s Trust. So how do parents keep control? The first element in any planning is a children’s trust. We don’t want to deal directly with the children. Children may start off as nice people, but once the parents are in their 80s, the children will be convinced that they know more than their
parents. So a properly structured children’s trust will give the parents continuing control.