A flexible trust is a type of trust that allows the terms of the trust to be amended or modified over time. This type of trust is often used when the circumstances of the trust’s beneficiaries or the objectives of the trust may change over time.
Flexible trusts are usually set up by the person creating the trust (called the “grantor” or “settlor”) to give the trustee (the person responsible for managing the trust) the discretion to make decisions about how to distribute the trust assets and income to the beneficiaries (the people who will receive the benefits of the trust). The trust document typically outlines the broad objectives of the trust, and the trustee has the authority to interpret and apply those objectives in light of the changing circumstances of the beneficiaries.
For example, a flexible trust may be used to provide financial support for a child who is still in school, with the understanding that the trust can be amended as the child’s needs change over time. The trustee may have the discretion to decide whether to use the trust assets to pay for the child’s tuition, housing, or other expenses as they arise.
Flexible trusts can be useful in a variety of situations where the needs and circumstances of the beneficiaries may change over time. They can also provide a level of flexibility and adaptability that may not be possible with other types of trusts.