Express Your Trust Intentions by Phil Runyon

Express Your Trust Intentions

Thanksgiving, more than any other holiday, seems to bring us together not only for a gargantuan meal, but also for those awkward conversations about family relationships.  You know, "Why don't you ever call except when you need money?", or "I'd feel a lot better about helping out if you'd make an effort to get a job, any job."  Sometimes, though, we dodge those talks to keep the peace, and then fester about them for another year, hoping we eventually get our points across before time passes us by.

And that's my theme here:  If you've got something to say, and if you're too timid - or diplomatic - to say it to your offspring's face(s), at least put it in writing for your representatives to rely on once you're gone.  Here's an example: Your carefully-drafted trust says that distributions can be made for the "maintenance and support" of your progeny until they eventually get what's left at a more mature age - like when they might actually safeguard your benevolence instead of blowing it on concert tickets or home theater systems. 

But what does "maintenance and support" really mean to you?  Is it the hope that your kids will receive whatever they need or want to enjoy life's privileges, no matter what they're trying to do to make their own way?  Or should your trustee be considering and evaluating your children's self-help efforts - and responding primarily when they're doing the best they can, even if their life's work isn't putting them in the top tax bracket?  I suspect most of you are checking the latter box, but your trustee really needs to have that philosophy from you in writing if he, she or it is going to defend that concept to your beneficiaries and prevent a sense of unfettered entitlement on their part.  We all know people we call "trust fund babies", and I doubt we use that phrase as a form of flattery.  Maybe if their seniors hadn't left the coffers so wide open - but had expressed some constructive criteria for helping out - we'd not only be less resentful of those folks, but the babies themselves would also be healthier and, I submit, happier.  

And you don't need a lot of expensive legal help to do your trustees and beneficiaries the favor.  Your philosophy - which some refer to these days as an "ethical will" - can be in your own words, doesn't need to pass legal muster, and isn't in need of a notary to have its desired effect.  You can rewrite and refine it many times over the course of the years - without ever having to officially amend a trust - and as long as it's left with the people in charge of your stuff once you're gone, they'll have something concrete to point to in interpreting your intent.  Just include whatever's important to you that you want them to remember when you can't say it yourself - or don't want to say now and ruin everyone's festive dinner.

Posted November 19, 2014 Misc.