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Trust questions

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mwall289

Junior Member
What is the name of your state? WA

My grandmother left me in her will and I am entitled to about $25,000. In the will, she specified that if the grandchildren are under 25 years old, their money is to go into a trust. I am 24, graduated from college and attending graduate school next year. The executor and my mother want to avoid the cost of a trust and pass the money along to me right away because it's just going to go towards schooling and everyone feels I am responsible enough to manage the money.

Are there any ways to avoid putting the money in a trust and then immediately giving it all to me? How much does a typical trust cost to set up? Does that money come from my inheritance or the general pool of money? Any other advice?
 


Dandy Don

Senior Member
Unfortunately for you, the trustee is bound strictly by law to administer the trust exactly as it is written with all stipulations enforced, so you will not be able to get that money until age 25. It is possible that a special request could be made but you will need to consult a trust attorney about this and it might be costly in financial penalties or legal fees to challenge that provision in order to be paid earlier. I understand your need for the money but perhaps you could get a letter of credit or loan from a bank or financial institution using the trust money as collateral, and then paying it off when you are paid a year from now.
 

mwall289

Junior Member
I forgot to mention that there is a stipulation that allows for education expenses. Basically, my mother is going to give me the money under that rule. Does that make a difference? We just want to avoid wasting money on a trust.

Does anyone have any ideas about what a trust costs to set up or where the money comes from to pay that cost (my share or the general pool of money)?
 

seniorjudge

Senior Member
Q: I forgot to mention that there is a stipulation that allows for education expenses. Basically, my mother is going to give me the money under that rule. Does that make a difference? We just want to avoid wasting money on a trust.

A: Education expense is one legitimate reason to have a trust.



Q: Does anyone have any ideas about what a trust costs to set up or where the money comes from to pay that cost (my share or the general pool of money)?

A: Shop around; some lawyers charge exorbitant amounts for doing this stuff.
 

mwall289

Junior Member
By the time the estate is settled, I will be 10 months or so away from being 25.

I have searched and searched but still have no idea how much a trust will cost to set up (particularly a really simple one). My mother, the trustee, has the option to distribute the money for health or education and has complete and total control over the decision. Therefore, she is going to distribute it immediately (the reason we are trying to avoid the trust).

Also, does the cost of setting up a trust generally come from my share or the general pool of inheritance?

It really isn't a matter of anyone trying to be greedy, but we're just trying to avoid blowing a couple thousand on an expense that really isn't necessary.
 

anteater

Senior Member
Ya know, while probate judges don't take kindly to disregarding the provisions of a wll, they generally are pretty reasonable. It is certainly worth a try for the personal rep to ask the court's approval to distribute the money directly to you. Maybe something along the lines of:

"Your honor, Grandmother wrote her will back when mwall289 was still just a lump of clay. And it was certainly reasonable then to specify that mwall's bequest be placed in a trust. But now, mwall289 is a fine, mature, upstanding young man/woman. A college graduate pursuing graduate studies in xxxxxxx.

Furthermore, the trust allows the proposed trustee, mwall289's mother, to use the funds for mwall289's graduate education and that is her expressed intention. And, if mwall289 had direct access to the funds, it is his/her intention to use them for educational purposes.

Therefore, your honor, since we are all satisfied that the funds will be used wisely by mwall289, I request your approval to avoid the intermediate hoops and approve distribution of $25,000 directly to mwall289. Pretty please!"
 

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