Gail E. Cohen, Vice Chairman & General Trust Counsel at Fiduciary Trust Company International reports that a trust’s ability to produce income can suffer when interest rates are low.  One strategy to potentially increase distributions for an income beneficiary is an often overlooked tool called “the power to adjust.”

The power to adjust addresses an inherent conflict of interest that exists between trust beneficiaries with competing investment management goals. Most trusts are structured so that current income beneficiaries receive the income generated from a trust, and the remainder beneficiaries ultimately receive the principal and any capital appreciation at the end of the trust’s term.

via With Interest Rates Low, Here’s How To Boost Income From A Trust.

Posted by Lewis J. Saret, Co-General Editor, Wealth Strategies Journal.