Estate Planning: Securing Your Legacy for Future Generations

What special aspects should Karen consider in her estate planning for Carly?

a) Should Karen establish a trust fund naming Carly as income beneficiary?
b) Should Karen establish a trust fund naming someone other than Carly as the capital beneficiary?
c) Could bequests to Carly disrupt her benefits under a public assistance program?
d) Should Carly make a will as well?

Answer:

The false statement is that 'Carly needs to make a will'. Due to her legally declared mental incapacity, she cannot create a valid will. The other statements hold true and should be carefully considered in Karen's estate planning.

Explanation:

In regard to Karen's and Carly's estate plans, there are a number of considerations to be made. Firstly, one FALSE statement among the given options is that 'Carly needs to make a will'. Due to Carly's mental incapacity as legally declared, she would not be able to create a valid will. However, Karen, her mother, has the ability to best plan for Carly's future and her inheritance. Karen can indeed establish a trust fund with Carly as the income beneficiary, and may also consider establishing a trust fund naming someone other than Carly as the capital beneficiary, especially given Carly's condition. Also, socially, any bequests to Carly may affect her rights to benefits under a public assistance program. Therefore, these matters have to be carefully planned and considered.