Revocable Trust for Single Individual
(Pot Trust for Children) (NJ)

Summary

This template is a revocable trust for use in New Jersey by an unmarried individual. It provides for the residuary trust estate to go into a pot trust for the benefit of the grantor’s surviving children if any one or more of them is under age the specified age. It contains practical guidance, drafting notes, alternate clauses, and optional clauses. This trust distributes the residuary trust estate to the grantor’s children in a single “pot” trust, known as the family trust in the Agreement, upon the grantor’s death. The trustee will administer the assets of the family trust until such time as the youngest child reaches the specified age. The trustee has broad discretion in providing for the children and is not required to treat them equally. When the youngest child reaches the specified age, the trustee distributes the family trust assets to the grantor’s issue. “Revocable trust” is another name for “living trust” or “inter vivos trust” and is typically used as a will substitute to avoid probate. The revocable trust also includes elements of disability planning as assets can be managed by the successor trustee without an adjudication of incapacity. However, because the grantor retains power over the trust assets, revocable trusts do not provide asset protection or estate tax savings. In addition to the creation of the trust, the grantor will need to fund the trust with all of their individually owned assets in order avoid probate. To assist your client with funding, once they give you a completed questionnaire, you should provide a checklist and/or letter to help them understand the additional action required to coordinate the estate plan beyond executing the documents. This includes, for example, recording new deeds for real property, updating beneficiary designations with investment, retirement, checking, and savings accounts, and more. To ensure that all of the decedent’s assets are properly transferred to the intended beneficiaries, a revocable trust should be used together and coordinated with a pour over will. For more information on revocable trusts, see Characteristics and Uses of Trusts (NJ), and Revocation, Amendment, and Termination of Trusts (NJ). For a letter to a client regarding the importance of funding a revocable trust, see Letter to Client (Funding Revocable Trust) (NJ).