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Q: What is the best way to set up an education trust for my grandchildren in my will? Should I set up one fund that all of them can dip into, or one for each of them?

A: Planning for a loved one’s education in a will is fairly easy to do. The toughest part is deciding what form the bequest should take.

Obviously a trust is a good option. Trusts offer a lot of flexibility as to terms and conditions that the loved ones need to meet.

If you want to set up one trust fund, you can use what is affectionately referred to as a pot trust. A pot trust is essentially a pot of money that each of the beneficiaries can request funds from. A pot trust is a simple option but you should be careful with the terms if you intend for all of the beneficiaries to be treated equally.

Many pot trusts allow for unequal distributions among the beneficiaries. That means that one or more beneficiaries could receive more from the trust than the other beneficiaries. Now, that might be your intent, but the unequal distribution can lead to unintended results.

For example, one beneficiary may attend the University of Notre Dame while another attends Indiana University. The Notre Dame beneficiary is almost certainly going to receive more from the trust than the IU student.

Also, if there is a wide age gap between the beneficiaries, the younger beneficiary may discover that the much older beneficiaries used up most of the trust before the younger one even made it to college.

Another option is to establish a separate trust for each of the beneficiaries. Using individual trusts makes equal treatment simple because each beneficiary’s trust receives the same amount of money.

But a downside to separate trusts is that a trust may not be sufficient for your goal. For example, the hypothetical Notre Dame student may use up all of her funds before graduation while the IU student may have excess funds in his trust.

If equal treatment is your goal, then it may not be a concern. However, if funding all of their education is a goal, it could be a problem.

Another option would be to utilize existing educational devices such as 529 plans. Funding an educational device limits your ability to dictate the terms for distributions.

However, since a 529 is designed with education in mind, it is designed to be flexible and to address the changing educational environment.

Funding a loved one’s education is a great legacy to leave. All it takes is a little thought about what you are hoping to accomplish and a little planning to get there.

Christopher W. Yugo is an attorney in Crown Point. Chris’ Estate Planning Article appears online every Sunday at www.nwi.com. Address questions to Chris in care of The Times, 601 W. 45th Ave., Munster, IN 46321 or to Chrisyugolaw@gmail.com. Chris’ information is meant to be general in nature. Specific legal, tax, or insurance questions should be referred to your attorney, accountant, or estate-planning specialist.

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