How to spend your legacy?

[2manyrocks]

1/3 at 30, 1/3 at 35, balance at 40 not uncommon, but you have to have enough trust principal to earn enough income to pay the trustee fees. If the trustee is an individual, then you also have to factor in the age of the trustee and the risk that the trustee will die or become incapacitated before the trust is completely paid out.

 

[tallyho8]

1/3 at 30, 1/3 at 35, balance at 40 not uncommon, but you have to have enough trust principal to earn enough income to pay the trustee fees. If the trustee is an individual, then you also have to factor in the age of the trustee and the risk that the trustee will die or become incapacitated before the trust is completely paid out.

That is how my son's trust is laid out, unless one of us is living when he is 30. Then it would move to 35, 40 and 45.
Our niece, who has always been helpful, including coming from Florida to Louisiana to stay with me while I was in the hospital with a heart attack, during the Christmas holidays, is our trustee. Years ago, I lent her $7000 and she paid me back, in full, as we agreed. She is one of the rare people who ever paid me back a loan I had given. She is 47 and a teacher for special children. In the event that she dies before the trust is fully paid, the balance will be paid at that time.

 

[goeduck]

Curious of the logic to delay 5 years if one of you is living.

 

[Streetcar]

Depends on the organization.

Our local hospice provided nurses to check on my father in-law every day at his home. There was no charge. They could send someone to sit with him so my mother in-law could take a break, go somewhere, get away, go to appointments, etc. There was no charge. She could take him to the hospice facility for day care, or she could take him there for a week or two if needed. There was no charge. When she got too weak to take care of him at home, and he could not help her by standing up on his own, is when she was getting to send him there for his end of life. He passed at home while awaiting a COVID test before being admitted. Had he been admitted, there would have been no charge.

Pretty sure out local Hospice is all donation driven.

For decades we had one hospice with several locations. They did all of that stuff, one year my son was young volunteer of the year. Just before Covid second organization started. Last year another started.

 

[Sigarms]

This is a hypothetical question. (sort of) Let's suppose that you are fairly old and have no close relatives left. You worked very hard all your lifetime and were conservative spending and have amassed a nice savings. Let's just say around $1,000,000 which is not very much nowdays. Your health is failing and you don't want your money to go to your closest relative which you hardly even know so you want to make out a will.

You are an animal lover who has had hounds and horses all his life but hesitate to leave money to some of the so-called animal protectorates like PETA and many others who I have found spend money on ways I do not agree with. There are so many so-called charities that collect money for some worthy cause but keep 90% and only 10% goes to that cause. Most of your good friends who are still living are as old or older than you and you may very well outlast them. You would like to be remembered by your community as a special person but not by just having the fanciest and most expensive grave marker in town. How would you make out your will?

This question does not just apply to me as I have made my will already and I leave everything to my wife of, so far, 57 years. But, in the event I outlive her, I am not satisfied with the will I have made. My area has an outstanding police department that has done a remarkable job for many years without the problems you hear so often now but has the problem of hiring new recruits as no one in their right mind wants to be a cop anymore where the cop is more likely to end up in jail than the criminal so I want to do everything I can to make sure that people know that the community supports them. So I have a small portion of my will going to the Sheriff's Office with the Sherrif deciding to whom and how much of the money will go to any deputy who is severely injured or killed in the line of duty. Other amounts go to relatives who I barely know and really don't believe they deserve it.

If you were in the described situation, how would you make out your will?

I've read the entire thread, and perhaps I missed it, but you have estates set up for some particular family members, do you and your wife have a estate set up for yourselves?

When we first moved to the county we live in 18 years ago, we got involved in the local humane society (local human societies are not generally related to the ASPCA which I don't particularly care for myself due to what they actually do with their money). Ironically enough, a local woman who moved to Louisiana and passed, and her estate had left 50k to our county for the specific use of low cost spay/neutering for the county. We actually handled that money ourselves to disperse of over the years and found it invaluable. That said, we also devised a program per income on who would actually receive that money (the reality is why should money left go to people who could actually afford to spay neuter that would "take away" from people who had animals that were basically "poor" and then the question became to define "poor"). I just remember that program and how many people it helped.

That said, just be careful on what organizations you leave your money to and I would stay away from leaving with individuals unless you specifically trust them. Then the question becomes what happens if those people are no longer around that you trust?

You had mentioned about leaving money to the local sheriff. We just got a new sheriff in our county, and the we really like him for multiple personal reasons, to point where we tried to help him get elected. We have no issue trying to help him with limited resources to bringing back a K9 unit to the county which the previous sheriff had disbanded.

My point about leaving money to one man in charge is that man over time can be replaced, and that new person may not have the same views as yourself what should be done with money donated to them. You leave money to the sheriffs office, new guy gets in, how do you know that new man will honor your wishes?

I can also tell you from first hand experience that when people volunteer their time for hopefully a greater good, that over time sometimes the organization becomes more important to it's members than the organizations mission statement. So, one group you decide who should have money to now may not be the same group of people down the road when the money is to be dispersed.

That's why I would look at a trust lawyer you trust (no pun intended) so the money can go to where you actually want it to try and help.

 

[Sigarms]

My wife and I have been talking about this topic recently. My brother passed away without a will, and it's been interesting to see who his friends where. Most of them want his stuff, but only one actually showed up to help out with getting everything in order. He is also the only one that didn't ask for anything.

Dealing with his estate has made us question what we to happen with our stuff. I don't have any kids, but my wife has 4. She has said more then once that kids are over rated. They are all OK, but none of them will do anything for anybody else. They all do the very minimum to get by, and then put all their energy into complaining and begging for handouts. We do not plan on leaving them anything. We also don't expect any of them to help us out if we need help with anything when we get older. We're on our own.

One of our passions in life is our dogs. We raise and show Akita's. Our biggest concern is that they will be taken care of after we pass away. As we get older, we will slow down with this, but there is always the concern that we might pass away before they do. We know of several people in the Akita world that would take care of them, so that's been a consideration. We also know of a young lady that would be a good fit to live here and take over the place once we are gone. We're not thrilled with her husband, but he might not be around for much longer and that strengthens her position to get everything. I know it's petty on our part, but he is lazy and jealous of her success from her hard work and constantly pushing herself. On several occasions he has gone out of his way to sabotage her for no other reason then to try to make himself look good. With him in the picture, it complicates what we want to do with our place.

Another option is the Akita Club of America. My wife is a Board Member and we are very active in supporting everything they do to help the breed. There are some truly horrible people out there and when law enforcement takes action, the Club steps in to find homes for those Akita's. We both believe that if they received our estate, they would do what's best for our dogs.

There is also hope that one or some of the grandkids will become people that we can become proud. In that, I'm saying that we would chose one or all of them to receive everything we have if they are successful, responsible, and honest. Unfortunately, our fear is that they will turn out like their parents and live their life's based on what they can get for nothing, and finding as much time as possible to play video games. It might be better if they where crack addicts. I think there is a chance of overcoming crack. Video Games seem to be more addictive!!!!

If we live long enough, we will eventually sell the farm, move somewhere else, and downsize. If that happens, we will have fewer dogs, fewer things that would need to be sold, and hopefully more cash in the bank that we're living off of. What's left will go to who we feel has done the best with their life, not the ones who want something for free and spend all their time making excuses for not working towards anything.

Eddie

I see why you like your wife

It was your brothers death that made me look at what we thought was our family trust, only to realize it was only a will.

No one plans for death (and if we're all lucky, we live to we have good health and die in our sleep) but I would suggest a family trust for you and your wife.

The irony with our family trust is in the event if anything were to happen to my wife and I at the same time (say a car accident), the executor of my family trust isn't even related to me, but someone to who both my wife and I trust explicitly. Reality is my MIL is getting to old to deal with this kind of stuff, and we don't trust my wife's sister with money and she lives close by. My one cousin may move down to NC to be closer with her daughter, and if she does, she may then become the executor.

My one boy graduates high school this year, and we will see how he plays out. He just worked 10 hours yesterday at the grocery store, Just left to work another 10 hours this morning, he has also become the shift manager there, works another job at a car wash, and is paying me back like he said he would after he found out why he should have NOT bought a Mercedes (with his own money) and had to have service done on the car that he couldn't do himself. His plan is the military after school, and both jobs told him that if he doesn't enlist, they would like him to stay working where he's at. He's also proud that he considers himself cheap like my dad. We have hopes for him, but still did not want to unload everything on him if anything were to happen to us at his age (we figure age 35 is a good age to see how he "settles out" as an adult).

Nice thing with a family trust is everything is kept "in house" and you don't have to deal with probate. The trust can also be changed and updated, just like a will.

The hard question is what becomes of everything you and your wife own right now and something happens to both of you at the same time? Is something laid out for others to follow?

 

[Sigarms]

Maybe I'm crazy but I've never been a fan of anyone leaving a lot of anything to anyone/anything when their gone. What are you saving it for? Enjoy what you've earned, if that enjoyment comes from donating a good portion of it to a worthy cause why wait until you're dead? Do it now, save enough for your needs obviously and that may be hard to determine but I have no desire to be on my death bed with huge sums of money in the bank or tools in the shed. I'd rather be scraping by at the end knowing I saw the funds used and the tools split up and used by those who wanted them not auctioned off or scraped. But that's just me.

I have to laugh, I told my dad the same thing, to spend his money on himself! When I tried to convince him to buy himself a brand new car in 2005, he only wanted to spend 13K for a new car and I convinced him to spend at least 30k on something he really liked, and he did. He actually did it 3 more times before he came to live with us.

Mom passed away in 2002 an no one thought my father would live past a year. He made it 20 years by himself, with the last 4 years living with us.

Thing is, he didn't have to worry about me as I had my own career and our own finances (my wife works full time as well).

He took my advice and for the next 15 years after mom left, and went to either Alaska or Montana fly fishing every year, and always went with his golfing buddies to SC for a weekly golf trip.

My dad left me about 160k along with his last car which was a very easy transition due to the estate he had set up. I will NEVER sell his car because I was the one who helped him pick it out. I'm also blessed in that my wife and I were mostly debt free when my father came to live with us.

Here is the thing, I don't view my fathers money for me to spend on myself, but to hold on to it and not piss it away because he left it to me. I did buy his grandson's class ring on my dad's behalf because I know he (my dad) would have wanted me to (my son wore my dads 1950 high school class ring that my dad gave him with pride).

My one cousin who I was always envious of growing up because his dad (my uncle) bought him everything for Christmas growing up (cars, motorcycles and other "cool gifts"). When my uncle passed, he left him his house and about 100k in cash (my cousin was a only child like myself). That was about 25 years ago when my uncle passed. That same cousin now lives in a trailer, divorced and doesn't really work due to a injury years ago, and basically pissed everything his father left him away on really stupid material stuff. He has NOTHING that his father left him.

My father was a better man than myself, but the one thing he tried to instill in me to do better than he did and be happy doing it. Dad grew up dirt poor where my grandparents came off the boat in the early 1900's and worked the coal mines. Both sets of my grandparents came off the boat into a new country not speaking English, and tried to make a better lives for themselves and their children and died working doing so for my parents (back then, OSHA was non existent).

For some reason, it seems today that if anyone is left with any money from family, it's like "free money" to spend on yourself as you wish.

I would like to think that if both my wife and I live to the age of retirement, our son will be in a better position after we pass, but any money left to him IMO is NOT to blow it stupidly.

This is also another reason why after realizing we only had a will, we set up a family trust.

Apologies for getting off track.

 

[EddieWalker]

Since my brothers passing, and again from what I've read on this thread, my wife and I have had several conversations about who we want to pass our stuff on to when we are gone. All of her kids have failed to pay back money that they have borrowed. All of them received "free" money from Covid that they blew on video games, snacks, clothes and plastic collectables from favorite cartoons and TV shows. It's really heartbreaking to know that if we give them anything, it will be wasted just as fast as they can spend it.

They are all in their 30's now, with no evidence that they have matured or become responsible. One is trying to play the game to some degree, but when my wife was in the hospital for 30 days fighting colon cancer, he never came to visit her. The only one of her kids that did visit her only did so because he works in the hospital and we had a complaint that he came to deal with. In 30 days, he saw her just that one time.

I heard on the news that Psychologist's are now saying that a person doesn't mature until they are 37 years old. The main reason for this is Social Media and Video Games. For whatever reason, young people today are more focused on make believe then dealing with reality, and it's taking them a lot longer to grow up. From what I've seen of those around me, I think that they may be right.

One thing that we're discussing is having all of our assets sold, with some money to make it worthwhile going to the executor. Make it based on a percentage of everything sold to encourage the effort is put into getting as much as possible. Then dividing it up with the grand kids when they get a Masters or maybe wait until one of them gets a PhD. Karen was in her 50's when she got her PhD, and waiting that long might make them more responsible with it. Dangle that carrot in front of them, and hope that by the time it happens, they are mature enough not to waste it.

But I'm also leaning toward giving it all to the Akita Club, like I mentioned earlier in my comments. I know that the money will go towards rescuing Akita's, and I really like dogs a lot more then people.

 

[2manyrocks]

Some have self control. Others not so much. There are plenty of stories of people who win the lottery, receive a large inheritance or have high athlete incomes etc. that end up broke. If someone doesn't have financial discipline, they don't have financial discipline. That's why spendthrift trusts have been used for a very, very long time.

Sometimes you start off thinking you have a responsible person. Then they have surgery resulting in them taking pain meds. Then the meds turn into an addiction. Some spendthrift trusts also grant the trustee discretion to withhold distributions when a beneficiary is blowing their money due to addiction or acting under the bad influence of some other person. But the basic spendthrift trust says the trustee has discretion to pay money to or for the beneficiary meaning that the trustee can directly pay their basic living needs for housing, food, medical care instead of paying it to the beneficiary who would otherwise turn around and blow the money on something stupid.

Not so much fun for the trustee dealing with them. Typical bank will set basic expenses on autopay and try not to get involved in a lot of drawn out discussions with the beneficiaries asking to get cash that they are just going to blow.

 

[MossRoad]

As I've mentioned before, I originally wanted to make a bunch of stipulations on when our kids would get our money, at what ages, at what milestones, what they had to do with it, what has to be spent on education, room and board, etc. That was when they were kids and someone else would have to be taking care of them until age 18.

The lawyer talked it out of us. He said trying to control them from the grave will just make them resent us.

Set up a simple will, with guardians for the kids. What you want done with their education money, and room and board. Guardians for the kids were to be one of my sisters, and her husband. Then give them their share of the money when they turn 21. Leave them a letter with some guidance and suggestions, but let them make their mistakes and triumphs on their own.

So that's what we did. Fortunately, we never had to use it. Now that they're both over 25, and out on their own, they can make their own adult decisions, good or bad.

We've told them this, and they are fine with it.