I'm currently working my way through creating trusts. The one I'm setting up for my son is a spendthrift one. Up to now he has acted responsibly (with one major exception), but he has never worked with large sums of money, and has a low paying job (he's in his early 40s). He has bipolar disorder and complies with med management. He had that one episode 7 years ago in which he sold his condo (paid for by my spouse and me in his name), cashed out his retirement and paid the penalties, quit his job, and moved across the country. He has no wife or children. My goal is that he not receive a lump sum, and I understand how a trust can accomplish this. What I really want to accomplish is that he gets the inheritance distributed over a period of time, say, 10 years (which also coincides with the current IRS SECURE act rules). And I want the annual distributions to be invested in an institution like Vanguard to be professionally managed (so that investment decisions are out of his hands). I can't imagine a way to do this except having the Trustee instruct my son to carry out my wishes and check in if he's doing it each year, and adjust distributions accordingly. I realize my son could agree to do it and take out all the money anyway, which might be fine. When I'm dead I won't care if he blows it over 10 years. I just don't want him to have the opportunity to do it at once. Or, to put it in more generous terms, I want him to receive his inheritance in ways that favor long-term good management of the money.
Statistics: Posted by RosemaryRetiree — Mon Aug 19, 2024 11:23 am — Replies 2 — Views 67