Robert Haas, a resident of Solon, Ohio, has trusted his financial advisor to manage his family's assets for over 20 years. The owner of a successful furniture store chain, Mr. Haas would like to set up a trust for his son, Henry, that allows his financial advisor to manage the trust assets until Henry turns 25 years old.
Mr. Haas' advisor recommends he establish a Direction Trust in Delaware in order to take advantage of the investment direction feature allowed by the state, as well as a host of other tax advantages and flexible benefits adopted by that jurisdiction.
Haas' financial advisor contacts outside counsel to draft the agreement and a trust company in the state of Delaware to serve as trustee. Together, Mr. Haas, his advisors, and the trust company develop a trust that does three things:
Mr. Haas can, in turn, delegate the investment advisory functions to his long-term investment advisor through an agreement separate from the trust. Thus, his new irrevocable Direction Trust enables him to maintain the flexibility of having his assets managed by his hometown financial advisor.
Updated: January 1, 2013
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© 2013 Wilmington Trust Corporation.