1

A grandmother has a will which leaves money to three grandchildren. The way it's written, the money would be in trust (managed by their father) until they reach 35, at which point the money is theirs outright. If they reach 35 before she dies, then the trust is skipped entirely.

One of the grandchildren (now 37) has some physical and mental health issues that lead to occasionally erratic behavior. The father has suggested to the grandmother that this means he's unable to manage his own affairs and she should write an exception so that grandchild's share is held in trust regardless of age. The grandson is really angry about this, and feels that this is meddling and controlling behavior. The truth lies somewhere in between (grandson is certainly irresponsible, but is not mentally incompetent) -- the two haven't gotten along well for years, and the proposal is causing a great deal of conflict and beginning to spread into a "pick sides" family-wide fight that can't end well. Hence, looking for ideas to propose a compromise that would satisfy all parties.

What are alternatives to a trust managed by a family member that still enable some oversight of inherited assets?

The grandson currently lives in New York State, but may move; the grandmother in Illinois. If this might be a better question for Money.SE, I apologize :)

2

The only alternative to a trust managed by a family member is a trust managed by an unrelated fiduciary. You really need to consult an estate planning practice in your jurisdiction to fully evaluate the options available there and to ensure that the details are implemented correctly.

  • The will writer's jurisdiction, not the beneficiary's jurisdiction, correct? – era Oct 16 '15 at 15:20
  • @era - Typically the grantor's jurisdiction (i.e., in this case the grandmother's). However one can certainly "shop" for jurisdictions: A good estate planner might, depending on the specific circumstances and desires, suggest creating a trust in a different jurisdiction. – feetwet Oct 16 '15 at 15:34
-2

A possible compromise is to amend the trust for the partially disabled grandchild so that the grandchild will received staggered distributions rather than all of the trust when the grandmother dies (as the grandchild is already older than 35). For example, the child could receive one third of the value of the trust at age 35 (immediately), one half of the amount remaining at age 45, and the balance at age 55. If the grandchild irresponsibly wasted the first distribution, he has other chances down the road. Meanwhile, the trustee can still use the income and principal for the grandchild's benefit. Also, the grandmother is under no obligation to share the details of her will with the family members.

  • I don't think this answers the question, which is how to get someone else "in charge". This describes a completely different outcome and changes the facts. – user6726 May 7 '17 at 20:13

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.