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Old 09-06-2019, 05:49 PM   #41
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The idea of a trust for grandchildren is a good one. There aren’t any grandchildren, yet, but we will definitely consider that should that change.
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Decisions...
Old 09-06-2019, 05:54 PM   #42
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Decisions...

Quote:
Originally Posted by yorick View Post
I have been pondering how to handle inheritance. First, my kids aren’t owed an inheritance. Nor am I. If it turns out that my own inheritance is “nil”, I’ll shrug and move on. Obsessing over material things feels a bit petty, as a response to a parent’s death.

So then - trust or not? We are, sadly, not on speaking terms with the eldest. Offers of mediated dialogue have been made and rebuffed. So there, it’s pretty much whatever we decide we do.

With the younger, we have a good relationship. He struggles with money and “adulting”, and a lot of that has to do just with how his brain works. That said, he can definitely make his own decisions. I think with him, we will sit down and have that discussion. Rather have structured payouts? A lump sum up front? A smaller sum up front, then structured payments after?

He knows what it is like to rob Peter to pay Paul. A sort of “UBI” may actually appeal to him, because no matter what, he’ll have enough for a roof and food.

So that is, I think, how we will approach this: By fiat for the eldest, unless communication improves drastically; and with a series of discussions with the younger.

Yorick,
I think this is a hard decision for most. All my grandparents died either poor, or with just a pension, so there was nothing for my parents to inherit when I was young. As I'm a bit better off than my brother, I expect that he'll get whatever is left, and I'm fine with that. If I wasn't talking to my dad, I would have no expectation of anything, and be quite elated if he left funds for my kids (his grandkids) college in a trust.

That would be great if your youngest has the self awareness to recognize that a structured payout is best for him, and that's what you're inclined to do. Consensus is always more pleasant than conflict. Good luck with whatever you decide.
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Old 09-06-2019, 07:01 PM   #43
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IMO...the big test of a good responsible child is NEVER having to ask a parent for money or to bail them out....either financially or from the slammer.

However, if a parent suspect that their child is irresponsible and may blow his inheritance, then a trust written by a good attorney is the way to go.

I am lucky that my daughter married a great guy but his income is less than what I would like. They ended living in a poor neighborhood but they never asked me for help or money. Since I had resources, I purchased a single story house with 100% cash for my wife and I. I then let my daughter and my son-in-law buy my original house with 100% cash using a seller's financed loan from me. The asset transfer from parent to child involve real estate so my daughter and son-in-law can't blow that asset away as easily.
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Old 09-06-2019, 07:48 PM   #44
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I think if he really wanted the money, he could just sell his right to the annuity to someone for a reduced amount.
My aunt set up her will so her money went into a trust. Her adopted son got enough to live on from the dividends (doled out by the trustee, my mother) but the provision was that he got the trust at age 35. The reasoning was that he did not get enough to be able to blow the money when younger and had to work and if he hadn't wised up by age 35, then that's his problem.
Now I also have an aunt who at one time was engaged to a man her father did not like (thought he was just after their money). So he wrote his will that his estate all went into a trust and my aunt could get the dividends only. Then at her death, the trust would be dissolved with the money going to her children, and if no children, the funds go to some charities. Well, my aunt married my uncle instead but the will was never changed - and they had no children of their own. So when she dies, there will be some very happy charities.
Some people also create a trust to be used in perpetuity for post-secondary education (within reason). So you could give 1/2 to your son and then 1/2 in a trust for education which will indirectly help your son since he would not have to save up a lot for any kids but also ensure other generations benefit even if your son is irresponsible. In this case, I would ensure the trust is set up with a trust department at a financial institution as the trustee.
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