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Beneficiary rights under spendthrift trust

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bee*p

Junior Member
spendthrift trust

A trust created for a beneficiary the grantor considers irresponsible about money. The trustee keeps control of the trust income, doling out money to the beneficiary as needed, and sometimes paying third parties (creditors, for example) on the beneficiary's behalf,
 
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S

seniorjudge

Guest
Since you did not give us the trust provisions, I will guess.


Q: Does the executor have a responsibility to invest funds for maximum gain or is just putting in a 1-2% interest bearing CD sufficient?

A: It depends on how strict the trust instrument is. The trustee will incur liability if the investments are too speculative, so generally they invest very conservatively.


Q: Home worth 310K, cash in CD 60K. Could executor, not that they will, decide to hand the trust over to me?

A: Probably not, since you said this was a spendthrift trust. There may be provisions, however, when you get to be so old, that the trustee could turn everything over to you.


Q: Is it at their whim to hand over funds, whole or in part though it is my money?

A: It is not a whim; they must follow what the trust agreement says to the letter.


Q: For instance, is it up to them do decide whether I am to purchase a new auto or not?

A: Consult the trust agreement. Usually buying automobiles is pretty suspect since they are not investments but expensive assets to buy. In other words, it depletes the corpus of the trust.


Q: I am 50 years old and finding the trust very restrictive.

A: That is not the fault of the trustee; it is the wishes of the person(s) who set up the trust.
 

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