Trust decanting is an underused strategy for estate planning that can add value to your practice. While very few clients are aware of this option, practices that offer it can have an advantage. Not only is this a great way to offer an important service to your clients, but it also distinguishes you as a practice among competitors.
Wine lovers know that the term “decant” means to pour wine from one container into another to open up the aromas and flavors of the wine. In the world of irrevocable trusts, “decanting” describes the legal process through which the trustee distributes trust property into another trust for the benefit of one or more of the beneficiaries. In other words, the trustee transfers some or all of the property held in an existing trust into a brand new trust with different andmore favorable terms.
It may be a good idea to decant a trust for a number of reasons. For instance, there may have been errors or ambiguous provisions in the original trust that need to be altered. Furthermore, while the trust may have been seen as beneficial when originally created, new circumstances may call for alteration. Changes in governing laws may provide better opportunities for the beneficiary, and a new trust could meet their needs more effectively. A trust may need to be converted if it terminates once the beneficiary reaches a certain age. Trustee powers may need to be expanded or limited. Finally, multiple trusts may better serve a beneficiary by being merged into a single trust, or separate trusts may need to be created out of a single trust to address the differing needs of multiple beneficiaries.
Why add it to your practice?
As you can see, trust decanting requires attention to the specifics of the client’s needs and situation. This is what you and your practice have to offer. Providing this service will set you apart from competitors who don’t. It will also give you an important edge over increasingly popular do-it-yourself legal services. These companies usually can’t offer the same level of detailed attention to client needs, and can’t recommend when trust decanting might be appropriate. This is a great way to serve your clients, bringing added value to their lives and to your law business at the same time.
How should you get started?
Ready to incorporate trust decanting into your practice? Here are three starting points:
- Know your rules: Make sure you understand decanting and that your practice is well acquainted with the provisions in your jurisdiction. Laws vary from state to state.
- Discuss it with current clients: Explore decanting with current clients who have trusts. Perhaps it can address their needs more effectively. This is a great way to demonstrate care and attention to their specific situation and show value for relationships in your practice.
- Offer it to prospective clients: Include trust decanting as a service in your marketing strategy and leverage your expertise. Let prospective clients know that you offer it. It may be the specific solution you can provide, and help convert them to a new client for your practice.
Are you currently offering trust decanting as a service to your clients? Tell us how it's working for you in the comments section. If you're not doing this now, learn more about how WealthCounsel’s practice building and legal marketing resources can help you integrate trust decanting to grow your law practice.
