Estate Planning Strategy for Financial Stability

Medium Private Wealth Management Estate Planning

John is a high-net-worth individual who wishes to create a comprehensive estate plan to ensure that his wealth is appropriately distributed among his heirs and to minimize taxes. He has three adult children: two of whom are financially stable and one who has struggled with financial issues in the past. John wants to treat all three children equally in terms of the wealth distribution, but he is concerned about his financially unstable child's ability to responsibly manage the inheritance. To address this situation, John considers various estate planning strategies.

Which of the following strategies would be the most effective for John to ensure that his financially unstable child receives support while managing the risks of financial mismanagement?

Establish a trust fund that distributes a set annual amount to the unstable child until a certain age.

Include a clause in his will that specifies an outright inheritance at his death regardless of the child's situation.

Create a simple will that divides his estate equally among all three children.

Hint

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