Looking for opinions on differing distribution times for sibling heirs

[FedRetired50]

Ah, I didn't know your 25-year-old has/had ADHD. On the CDC website (ADHD in Adults: An Overview) it says among other things "Symptoms may also become more severe when the demands of adulthood increase." So it may be that she will need ongoing extra help of some sort all her life.

Yet frustrating that was was working 5 days a week just 6 months ago (but hasn't worked summer school in a few years, intentionally). She buys all her own food, maintains her own car and cat, graduated high school and her AA w/o meds, and in general has shown that she's a functional adult. I mostly just think she doesn't want to work, would rather play video games, and uses several things including ADHD as an excuse.

 

[HarveyS]

That will be my brother and I haven't discussed that with him yet. He will have little to do. Invest it all in VTSAX, pay out the annual distributions, make the 2 big distributions, and I'm allowing a one-time payout towards a wedding for each kid. Otherwise sit there and watch it grow.

I suggest you talk with your lawyer about what will need to be done. You seem to be severely underestimating the work. Record keeping, filing taxes on a trust, paying taxes, dealing with calls from the kids asking for more, etc.

On a second note, your older daughter will need to worry about her own healthcare come age 26. How is she addressing that?

 

[FedRetired50]

I suggest you talk with your lawyer about what will need to be done. You seem to be severely underestimating the work. Record keeping, filing taxes on a trust, paying taxes, dealing with calls from the kids asking for more, etc.

On a second note, your older daughter will need to worry about her own healthcare come age 26. How is she addressing that?

Discussed with my brother, and my current lawyer who is working on my new will. When I said the job was relatively simple I meant it wasn't going to require a governing committee and 3 CPAs.

She recently signed up for healthcare at her current job. I pointed out that the paperwork stated she had to be working full-time to qualify but she insisted she is considered full-time. I'm hoping if she really doesn't qualify that the benefits coordinator will tell her that, but that same person gave her all of the documentation to sign up, too.

 

[OldShooter]

Oooo, while I'd heard of this before it didn't click until your suggestion. Just added it to the draft of my will. Thanks.

OP, I hope you aren't planning to implement this complicated scenario without getting serious professional help. There are lots of things that need to be considered in designing an estate aka trust plan. For example:

1) Death, marriage, incapacity, or children of a beneficiary.​

2) Major event like a fatal disease where you would want the payments to the beneficiary to be accelerate vs the basic plan.​

3) Major family fracture due to a family-member trustee taking action or making payments that are discretionary and not agreed-to by a beneficiary or beneficiaries. (Hint: use a corporate trustee at least as the bad cop.)​

4) Contingent beneficiary child reaching the age of majority.​

5) Tax strategies to minimize or avoid very high trust income taxes.​

6) What happens if an interested party sues the trust, attempting to break it. For example, there was a post here a couple of years ago where the beneficiary of a trust was being coached by his Eddie Jones broker to break the trust so the broker could run the money (for a fee of course.)​

Professionals in the trusts & estates business will have many thoughts and suggestion on how to deal with these and many other scenarios. There's nothing you're thinking about here that is too far out there, but there is a huge amount of carefully thought through meat that needs to be added to the bones you have.

Good luck!

 

[Koolau]

DW has a cousin who is afflicted with some sort of "issue" (Aspergers? ADHD? ?). He's very high function. He lived with his parents until they passed. Then he lived with his older brother until he passed. Now he is in a "care home" at some level. I think he's about age 65.

He's constantly being threatened with expulsion because he fails to follow the rules. He's totally dependent on Medicaid. He completely understands the requirements but simply is incapable of following the rules. He says the rules are "unfair."

He has contacted DW and says that she should take care of him! He thinks he should move in with us!!

My point is that there is a broad level of "existence" that can not be dealt with externally (though mandatory commitment, for instance) and yet the person is totally incapable of living on their own. They have no marketable skills and couldn't hold a j*b if they did.

Most of us have no relation to someone like this but, when they do, it's uncomfortable to say the least. DW has never had a lot of contact with this cousin, but feels at least some sympathy. But short of "taking him in" has no power to help him.

I can't imagine having a relationship with a true loved one who needs external control but rejects it. What do you do? Do you allow them to be on the street?

 

[engineernerd]

Yet frustrating that was was working 5 days a week just 6 months ago (but hasn't worked summer school in a few years, intentionally). She buys all her own food, maintains her own car and cat, graduated high school and her AA w/o meds, and in general has shown that she's a functional adult. I mostly just think she doesn't want to work, would rather play video games, and uses several things including ADHD as an excuse.

I dunno, does she seem happy to you? Generally young people who hide out from the world playing video games in their rooms in their parents' homes do not look happy to me. My neighbor's son was happy when he thought he was on a career track at his then-employer. He was taking care of himself physically, was happy to engage socially even with his old-fuddy-duddy parents' friends, and walked with a bounce in his step.

Then the company started treating him badly. Eventually he quit, started hiding out in his room and avoiding people, and lost all his physical fitness and put on a bunch of weight. He now does work but in a dead-end job probably with low pay and limited hours (though it's a nice local small business with friendly staff), and he still spends a lot of time alone in his room and has not improved his physical health.

BTW, being able to afford food and a car is far from being able to afford to live independently in one's own apartment or house. It's not a good time to be a young person trying to leave the nest, I read that close to half of young adults now still live at home years after graduating from college or high school.

 

[FedRetired50]

@OldShooter yup working with an estate lawyer as mentioned.

@Koolau she has her mother's place as a fallback, but that would make things worse since her mother will only enable the situation and won't push her to grow. No streets for her, but maybe not much better.

@engineernerd she also gets out with friends. My pushing her to get back to college has an ulterior motive of expanding her friend base, too. As mentioned, I've sat down with her several times to work through a realistic budget that would allow her to live on her own. She can make it work with a roommate (same as I did when I moved out), with her current job, if she just goes full-time.

 

[Dash man]

ADHD runs rampant in DW’s family. Her son is now 43 and works as a cook for a catering business. He’s always loved cooking and it’s his comfort zone. He did graduate college with a graphic design degree, but has always worked as a cook since then.
We tried tough love in his early adulthood, which didn’t work out well. Trying to manipulate behavior by incentives or attaching conditions doesn’t work. He is intelligent and is a great father to his twins. His wife left him, but they are still friends and do what they believe is best for the kids.
I used to believe DW was enabling him by helping him, but have learned a lot about ADHD over the years. They learn things differently than others. Their ability to concentrate is easily disrupted by simple sounds or other distractions. They need opportunities to focus to be able to complete a task.
We give annual gifts to our sons and recently gifted stock to each of them. The son with ADHD probably won’t touch it since it’s not cash in his account. Cash gifts in the past in check form went undeposited for weeks until we prodded him to deposit it.
We’ve decided in our trust to split things evenly between our sons, but the son with ADHD will get his as a monthly payment with anything left going to his kids. He will get all income generated by the investments. He will get a townhome that he currently lives in. The Trustee will be Charles Schwab, so there will be fees, but they will pay the property taxes and insurance. Our attorney will be the Trust Protector in case Schwab doesn’t do their part and our other son will monitor.
We just recently made a donation to our Parish’s elementary school that is creating a new program for these kids that have often been just promoted in school because teachers didn’t know how to deal with them. The local Catholic high school has a wonderful and successful program that is a model for these kids.

 

[HappilyRetired]

Our son has ADHD and has been a very successful business man, having his high tech company bought by Private equity 5 yrs ago. He is onto his next company in AI and blockchain. Having ADHD doesn’t define their intelligence or lack thereof. Quite the contrary. Don’t allow you DD use it as a crutch.

My wise dad was going to limit my sister’s access to her inheritance and have me dole it out to her. Not a good solution. BUt one day he announced to me “I do not want to control my children from the grave”. If she is unwise with her inheritance and spends it all, so be it. It really freed him up at that point.

I do implement incentives with our grands. Any income earned I will fund their ROTH that amount. I have started a Fidelity Youth account for those age eligible (age 13-18) and am teaching them how to invest and budget. The account gives them a debit Visa as well so a great tool at a young age to learn about delayed gratification and spending and saving!

Absolutely come up with a deadline for her to move out. You are enabling behavior that has to change or she will never launch. Good luck and let us know what you decided. Being a parent is hard! You can do this!!

 

[FedRetired50]

Having ADHD doesn’t define their intelligence or lack thereof. Quite the contrary. Don’t allow you DD use it as a crutch.

Of course. I've said elsewhere in this thread that I know she's far more capable than what she is currently achieving.

Absolutely come up with a deadline for her to move out. You are enabling behavior that has to change or she will never launch. Good luck and let us know what you decided. Being a parent is hard! You can do this!!

I wouldn't call me an enabler. Definition: a person who encourages or enables negative or self-destructive behavior in others. I've made it very clear in this thread that I'm doing the exact opposite. Financial education, budgeting sessions, encouragement to go back to college (which is already paid for with a 529). I even recently bribed her to go back to school. Now if she ends up living with her mother, that will be an enabler. I don't even discuss this stuff with her any more because she thinks I'm being too hard, lol.

 

[HMMY]

When the rest of us left for college, my parents told us to take everything we wanted with us since they were throwing out whatever we left. When our youngest sister left for college, they let her leave her stuff, and she returned after one semester. She eventually went to community college and took classes at various local colleges. She amassed well over 120 credits, but she never graduated. My sister just turned 50 and she's still living in my parent's house with her 15-year-old from a one-night stand. You should worry about what you can do to keep your oldest from becoming our youngest sister.

I think this is a critical junction in her life. I think you need to give her a deadline and start charging rent. If she can't pay it, she needs to move out. Let her move in with her mom. Force her to make some decisions and be accountable.

 

[FedRetired50]

I think you need to give her a deadline and start charging rent. If she can't pay it, she needs to move out. Let her move in with her mom. Force her to make some decisions and be accountable.

When I moved out (after 2 years of college), I wasn't allowed to take any furniture. I had my clothes, a computer, and my beat-up car. The first 2 weeks I slept on a pull-out couch with my roommate (a female, but we kept things platonic). When my brother moved out, he was allowed to take his furniture, although I protested loudly until he didn't. Lots of favoritism in that house.

I've mentioned in this thread that I do charge her rent, and she pays it. If she doesn't pay it by the 1st she will move out and she knows I'm serious about that. I'm trying NOT to have her move in with her mom, since she is an enabler in so many ways, and that may be the end of any hope for my daughter. There won't be any rent, or degree, and she'll be like your sister.

 

[Exwallstguy]

giving to fit each child is smart, The people who say a gift is for whatever that person wants to do with it ignore the fact that most people who win the lotto end up broke and regret winning. (Those people are generally not financially savvy). You presumably want the money you worked hard to save would be well used and help those you give. If that’s your goal, you need to give in a way that’ll best help that child. I talked my parents into giving me nothing as I retired at 42 and to leave my brother their condo than I’ll manage and to provide monthly income for him for the rest of his life. This way he can’t squander the money as he prob would and end up in a worse spot than before receiving the money. Large lump sums raise a persons living standard and it quickly spent and they will be accustomed to a higher standard of living. Give wisely if you want to help your children. I urged strongly against giving blindly and hoping it’ll work out when you know their past has proven it wont

 

[Dd852]

My own experience was this: my sister and I are totally different financially. (Since I'm here, you can guess what I am) . When our final parent died, we each got 50%. Immediately. No trusts. No paying for fancy second guessing of what we might do. No strings. We got it all, knowing that there was really nothing more ever to come except from our own sweat. Quite honestly, it transformed my sister, The knowledge that she had a huge chance in her hands and that there would be no recourse if she blew it, made her into an amazing steward of her present and future, leaving the past totally behind. Of course, it could have turned out otherwise. But no amount of red tape can stand in the way of someone who really wants to self-sabotage.

 

[pb4uski]

Raising kids is hard. A lot harder than it seems to be for my parents.

DS is ADHD and smart and functions pretty well but just doesn't have the drive that I had or DD has. He has been steadily employed over last decade or so other than a ~11 month period of unemployment in late 2024 and much of 2025 but he has had a job for a few months now and seems back on track. He is financially independent for the most part. He house sat for us over the summer to save money since he didn't have a job. He has slow-walked moving out, but those days are soon to be over. He doesn't make much but he is extremely frugal so he can still save and does so and has a mid-to-high five-figure net worth between checking, brokerage tIRA and Roth IRA.

He doesn't and probably will never make enough to own a home. He usually either shares and apartment with a roommate or rents a room in a house. I'm not sure if he really could be a homeowner, though he is surprisingly mechanical at times.

Of course, we had more in mind for him, but he is a good guy and a great uncle to our grandchildren who he loves dearly. DW sometimes gets sad over how things have worked out for him and I tell her that it is on him and that we are lucky compared to some parents in that he is alive (my best man's son committed suicide about a year ago), he isn't in prison or on drugs or an alcoholic and is working steady and supporting himself (for the most part) and is a good person so we should count our blessings.

I do have reservations about him ultimately inheriting a seven-figure inheritance. I'm not too worried about him blowing the money but am more concerned that he new-found wealth might attract some bad influences that would take advantage of him, but I think his sister and brother-in-law and possible aunts (my sisters) would help keep him on the right track.

Like I say, raising kids is a lot harder than our parents made it look.

 

[FIRE-Traveler]

A lot of wealthy folks create an incentive trust or an earned income-matching trust with capped amounts in case one sibling is high income and the other is low income. No income, no inheritance, in essence. You would be subsidizing earned income and earned income is a good thing.

McDonalds pays $20/hour here in California. Even a lazy person might be incentivized to take a minimum wage job if it means getting paid double.

Wow, this is a really fascinating idea. Thanks for sharing. Definitely something I would consider with my kids.

 

[FedRetired50]

Wow, this is a really fascinating idea. Thanks for sharing. Definitely something I would consider with my kids.

Yup, I'm definitely adding that to my will...

 

[a60dan]

Be sure to discuss with the trustee, regardless of what you decide.

I’m my father’s trustee and must distribute 50/50, which keeps it simple.

I’ve got to do it in a “reasonable “ timeframe so my biggest timing challenge is which of 2-3 tax years, and that’s dictated by the real estate market as we’re cashing out.

My brother and I have different levels of tax awareness, but I’ve done a pretty good job so far (I think).

I wish I’d asked more questions before my dad died, but the trust approach he chose gave me very wide discretion and authority. ….and a lot of responsibility

 

[HMMY]

If you're charging her rent and she's paying it but she's not working full-time, you're not charging her enough rent. My son's rent proposal was $0 for 6 months after graduation, $1,000/month for the next 6 months, and $1,500/month thereafter. He moved out after 3 months.

My parents didn't charge rent to my sister and she bought a car with a 7-year loan whose cost was nearly the equivalent of her annual salary. Even though her monthly payments were "affordable", she paid nearly the cost of the car in interest. Being subsidized allowed her to make bad decisions.

 

[HMMY]

Also, don't be so sure that she would prefer being coddled by mom. My friend's sons moved out to live with their mom so they could play video games uninterrupted. Neither stayed long. Living with her was the impetus for them to fix their lives because they didn't want to live with her or like her.

 

[pb4uski]

If you're charging her rent and she's paying it but she's not working full-time, you're not charging her enough rent. My son's rent proposal was $0 for 6 months after graduation, $1,000/month for the next 6 months, and $1,500/month thereafter. He moved out after 3 months.

My parents didn't charge rent to my sister and she bought a car with a 7-year loan whose cost was nearly the equivalent of her annual salary. Even though her monthly payments were "affordable", she paid nearly the cost of the car in interest. Being subsidized allowed her to make bad decisions.

When DS was living with us in his 20s, we started charging him rent but told him that we would refund all of what he paid in rent when he moved out. We called it the "DS Freedom Fund". I would give him a statement every so often and as the balance accumulated so did his interest in moving out to get the balance.

Even though we had a financial incentive in place, we were also encouraging DS to move out at every reasonable opportunity.

 

[HMMY]

When DS was living with us in his 20s, we started charging him rent but told him that we would refund all of what he paid in rent when he moved out. We called it the "DS Freedom Fund". I would give him a statement every so often and as the balance accumulated so did his interest in moving out to get the balance.

Even though we had a financial incentive in place, we were also encouraging DS to move out at every reasonable opportunity.

Our plan was to refund it as well when he moved out, but he moved out before he had to start paying rent. My husband didn't want our son to know about the refund because he didn't want to incentivize him to stay to save money because my husband wanted him out as soon as possible.

 

[RetiredHappy]

Raising kids is hard. A lot harder than it seems to be for my parents.

DS is ADHD and smart and functions pretty well but just doesn't have the drive that I had or DD has. He has been steadily employed over last decade or so other than a ~11 month period of unemployment in late 2024 and much of 2025 but he has had a job for a few months now and seems back on track. He is financially independent for the most part. He house sat for us over the summer to save money since he didn't have a job. He has slow-walked moving out, but those days are soon to be over. He doesn't make much but he is extremely frugal so he can still save and does so and has a mid-to-high five-figure net worth between checking, brokerage tIRA and Roth IRA.

He doesn't and probably will never make enough to own a home. He usually either shares and apartment with a roommate or rents a room in a house. I'm not sure if he really could be a homeowner, though he is surprisingly mechanical at times.

Of course, we had more in mind for him, but he is a good guy and a great uncle to our grandchildren who he loves dearly. DW sometimes gets sad over how things have worked out for him and I tell her that it is on him and that we are lucky compared to some parents in that he is alive (my best man's son committed suicide about a year ago), he isn't in prison or on drugs or an alcoholic and is working steady and supporting himself (for the most part) and is a good person so we should count our blessings.

I do have reservations about him ultimately inheriting a seven-figure inheritance. I'm not too worried about him blowing the money but am more concerned that he new-found wealth might attract some bad influences that would take advantage of him, but I think his sister and brother-in-law and possible aunts (my sisters) would help keep him on the right track.

Like I say, raising kids is a lot harder than our parents made it look.

I guess there is quite a bit of similarities with my son. He is has high functioning ASD and makes barely enough to pay bills. He owns his own home, one-third paid for with his savings when he worked for us, and I topped up the other two-thirds so that he does not have a mortgage. He owns it outright and he grew up overnight after he owned his home. He pays his property tax in full when he receives the bill, pays his HOA and utility bills. We have a joint savings account that I always ensure that there is at least $10K in it because when he is out of job for a while and he has a shortfall, he will pull from it. I also gift him each year into our joint investment account and I manage the account. Separately he has an IRA from the days when he worked for us and a taxable brokerage account that he funds and manages. I peaked at it when he showed me something on his computer a couple of months ago and he has a total of $400K right now between the 3 accounts. He knows that he will inherit millions but I don't see him changing. He is very frugal.