April 13, 2007,
N. asks from Addison, IL on April 12, 2007
Seeking Trust Fund Advice
I recently took out a larger life insurance policy, my third with other work policies. I was wondering how do you start up a living will and trust fund. I dont have any real estate, dont own a home, I just have personal property, savings, 401K and insurance. Do you need to put into trust funds or can I take a chunk of the life insurance and deligate it to a trust for my daughter when she reaches age 25. The problem is she's 3, initially I had my sister listed as my benificiary but she is not responsible with money and likes to crack comments like so when amd I gonna be rich, when can I knock you off. Although she's joking I dont like the fact that she is not taking this seriously so I have changed my benificiary to my daughter. Initially my sister was going to be her guardian if anything should ever happen but now that her father is in her life and as long as he continues to be a father the responsibility should go to him, I dont want either to have full access of the funds just enough cushion to support her and I want the rest to go to her when she's reached a more responsible age. Please offer advice?
A.S. answers from Chicago on April 13, 2007
You first need to contact an attorney who specializes in estate planning. He or she will be able to advise you on the "big picture" and then make sure that any arrangements you make would stand up in court. Save your energy. Let an expert guide you.
ps I'm really sorry about your sister.
A.H. answers from Chicago on April 13, 2007
Whatever you do, make sure that the one assigned to "manage" the trust fund is a lawyer and NOT a relation to your daughter. Do not, under any circumstances, leave a family member in charge of the money. I am dealing with a trust fund left by my grandparents where I was left in charge of money for my sister and it has destroyed (utterly) our relationship to the point where my husband now handles all communications with her for me. I am horribly heartbroken. But, because she has come to ME for the money, and not the lawyer who wrote up the trust, there have been conflicts over what she is allowed to have. She is not of age to have it yet (based on our mother's will) and yet I allowed for early distribution of funds for her college education... you get the idea. Make sure there is a third, impartial, party involved that has to manage the funds. Either a reputable invenstment company or an estate lawyer. I'd also get a financial advisor to help you determine the best way to lay away funds that will save you tax monies in the meantime, etc.
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A.A. answers from Chicago on April 13, 2007
I can't find the lawyer we used, but my financial adviser recommended him. You definitely want to get all that done. When our first child was 6 months old, we did everything at one time, the guardianship, the trust, the person in charge of the trust, our living wills, etc. It was great having it all done and that piece of mind that it's taken care of and the appropriate people involved have copies.
Good luck to you, but definitely a must!
R. answers from Chicago on April 13, 2007
Hi, I have friend who's husband is a lawyer that has his own practice that specializes in living trusts. He's done my families and many others. He lives in Schaumburg, but I'm pretty sure he comes to meet people wherever. His name is Craig Janas. Here's his number if you'd like to contact him.
I've known the family for over 5 years and they are very family oriented and I love them. Good luck with your search.
P.D. answers from Chicago on April 12, 2007
call Alan Pearlman ###-###-####... he will be able to help you out.
P., RLC, IBCLC
Pres. Lactation Support Group, Inc
J. answers from Chicago on April 12, 2007
I have been researching the same question, so I'm interested to see the other replies. What I've been told so far is that if you set up a trust and name an executor (who can be someone other than the guardian) you can put restrictions on having the money used for your child only.
J.H. answers from Chicago on April 13, 2007
Yes, you may need to set up a trust and a will. Maybe just a will could be sufficient. I have both set up for my kids. Like Jen said, I have a separate guardian and executor...mainly because I don't want my money to be used to the benefit of others...separation of duties, I guess. So, my executor knows how to spend the money and then I have specified that once my children reach maturity, they get so much percentage of money left over at 25 years of age, then so much at 30 years of age and so on. I don't believe a 21 year old should have all the money that is left over and is quite mature enough to know what to do with it. I have also made my intentions known that I would like them to go to college and have the money be used for that as well. Separately, I have a responsible party that has agreed to raise my kids should something happen to my husband and I.
You can name your daughter as a beneficiary of your policies, and she will get the money. But, whoever has guardianship, and if you don't name someone, the courts will for you, can spend the money as they like. If her father is still in the picture, he will probably get custody. If not, you will want to name a responsible person. So, it's to your benefit to name a guardian and then an executor and then specify exactly what you want the money to be used for.
Kind of like Larry Birkhead, with Anna Nicole Smith. He was so darn happy to be that little girl's father...not so sure because he wants to be a father...maybe that's true. But, my guess is that he's looking down the road and sees $$$ if that little girl gets some inheritance from Anna Nicole and J. Howard Marshall. If so, I'm sure there will be some good lawyers on that case to make sure the $$ goes to the girl and not Larry.