Expressing Goals and Intent for the Trust: The Trust Letter of Wishes

Legacy Planning, Once Removed

On this podcast, Steve has emphasized that the estate plan is designed to carry out the intent of the testator or settlor. With that in mind, it is especially important for the client to communicate those wishes, so that the trustee, beneficiaries and other interested parties understand the settlor’s intent in situations that might arise, such as a beneficiary’s request for funds to purchase a home or for the beneficiary’s support or education.

Sometimes the trust document is not the ideal place for the settlor to include more specific instructions — the language in the trust agreement often is complicated by legalese, or by tax and other practical considerations. Some clients prefer to communicate those wishes informally or rely on the trustee to make the right decision. But many clients would benefit from leaving a separate letter, sometimes called a “Trust Letter of Wishes,” that expresses the settlor’s intent in the settlor’s own words.

This episode explores the Trust Letter of Wishes, walks through some important limitations and guiding principles for the letter, and offers suggestions on how to use such a letter to communicate the settlor’s intent.