Settlement Trusts

Settlement trusts in Missouri play a crucial role in managing funds awarded from legal settlements, particularly in personal injury cases. These trusts are established to ensure that the beneficiary, who is typically the injured party, receives and uses the settlement funds responsibly over time. The primary purpose of a settlement trust is to safeguard the financial well-being and future security of the beneficiary.

Here are some key aspects of settlement trusts in Missouri:

• Fund Management and Distribution:
  Settlement trusts are designed to hold and manage the funds awarded in a legal settlement. The funds are deposited into the trust, and the trustee, who is usually a financial institution or a professional fiduciary, has the responsibility to manage and invest the money. The trustee is responsible for making distributions to the beneficiary according to the terms of the trust document.
• Responsible Use of Funds:
  One of the main objectives of a settlement trust is to ensure that the beneficiary uses the funds responsibly. The trust document typically outlines specific guidelines and restrictions on how the funds can be used. The trustee reviews and approves each distribution request to ensure it aligns with the purpose of the trust and the beneficiary's best interests.
• Asset Protection:
  Settlement trusts can provide asset protection for the beneficiary. The funds in the trust are generally considered separate from the beneficiary's personal assets, which means they may be shielded from creditors, lawsuits, and other potential financial liabilities. This protection ensures that the settlement funds are preserved for the beneficiary's long-term needs.
• Longevity and Financial Security:
  Settlement trusts are often structured to provide ongoing financial support for the beneficiary over an extended period. The trustee makes regular distributions to the beneficiary based on the terms of the trust, helping to ensure that the funds are used judiciously and last throughout the beneficiary's lifetime.
• Estate Planning:
  Settlement trusts can also serve as an estate planning tool. The trust document can include provisions for the distribution of the remaining funds upon the beneficiary's death, ensuring that the assets are managed and distributed as per the beneficiary's wishes.

Settlement trusts in Missouri are valuable financial tools that help individuals who have received significant awards in legal settlements manage their funds wisely, protect their assets, and secure their long-term financial future.