accumulation trust
- A type of trust where the principal amount and generated income are kept within the trust instead of being disbursed
- Children under 18 typically can't manage large sums of money, so an accumulation trust was established to protect their inheritance until they turn 25.
- To limit the beneficiary's access to the funds, the grantor chose to set up an accumulation trust that allows the money to grow.
- In their estate planning, they included an accumulation trust to ensure the generated income from their assets would benefit their grandchildren.
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