Setting up a testamentary trust for a child under a certain age is a common estate planning tool. The age sometimes varies, but the goal is usually the same; protect a loved one’s shares until they are at an age when they can manage it themselves.

A reader wrote recently to the business columnist at NWI with a common question: “My will says that my son’s share is held in trust until he is 25. What if he is married by 23 and has a baby? Does he still have to wait until he is 25 to get the money?”

The reply was somewhat simplistic, I thought, explaining that perhaps it would be good to give the trustee wide discretion to distribute funds out of and terminate a trust established for your children. Certainly, a testamentary trust of this sort that distributes funds outright to the beneficiary at a certain age, even with wide discretion on the part of the trustee, is better than no trust at all. As the writer comments, “Generally, I look at a testamentary trust provision for a minor as simply putting a responsible adult between a child and a pile of money. It's not there it punish the child but rather to protect him.”

There are however, other strategies you might want to consider when planning for your (currently) minor children. The greatest inheritance protection is achieved when your estate plan creates a Long-Term Discretionary Trust to administer the inheritance for your children. Such an arrangement can make both income and principal available to your children for their health, education, maintenance and support, as well as for any purpose deemed appropriate in the discretion of your appointed inheritance managers.