money for education in will

[kathyand]

california - 16 years ago a will was read that gave all nieces and nephews $10,000 each to be used for higher education; i.e., college. After taxes, the kids were left with approx $8,900 each. The money was given to the parents for the kids. Since this will specifies the money is to be used for education, is it the responsibility of the parents to invest it a specific way? The problem I have is that after 16 years, only $10,000 is in this account. This account would have had more sitting in a maximizer account. Is there any legal action that can be taken here? It seems obvious to me that the money was spent by the parent, but I have no proof. I'm told it was bad investing. What can I do?

 

[advisor10]

10-15-2001

DEAR KATHYAND:

Unfortunately, you do not have any recourse. Your parents can not be held responsible for any changes (up or down) that may have occurred in the stock market (or whatever vehicle they used to invest this money). Your accusing them of having spent the money, without having proof, would certainly create bad feelings.

Just BE GRATEFUL THAT YOU HAVE THE $10,000 AVAILABLE TO YOU NOW to help with your college expenses (because in similar situations when money has been left to some heirs for their educations, the money has been spent wrongfully and the heirs were left with nothing). You are to be congratulated for knowing/realizing that with proper investing, the amount could have been a little more. What kinds of college expenses/tuition are you facing now? Have you made a serious effort to apply for all of the grants and scholarships that you would be eligible for?

SINCERELY,

[email protected]

 

[kathyand]

Thanks for the reply. Actually the situation is a little different than you are thinking. This money went to my step-daughter. My husband has asked his x-wife for the money for 16 years. She told him it was invested with her boyfriend getting 12% interest. We believed her and let her manage the inheritance for two kids. Now that it's time for college, the money has suddenly disappeared. To make this situation worse, she and her husband recently purchased a 2nd home. Throughout the years we have wondered how she afforded new cars, trucks, etc. Now we are fearing the worst. We obviously don't want to do anything legally against her, but we thought mentioning it was illegal NOT to invest money specified for education in a safer account might help her come up with more than the original principal. She gave, without our knowledge, $7,000 to my step-son for an engagement ring--not education. Seems like this isn't legal either.

 

[advisor10]

10-17-2001

DEAR KATHYAND:

Why is it "obvious that we wouldn't want to do anything legally against her"? I don't know too many people that can afford to do without $10,000. You have a slam dunk, winnable case, if you can afford to pay the lawyer his upfront fee to defend you.

This was outright theft and unless you do something, she is going to get away with it. Her bank account records for the past year or more could be subpoenaed to show her standard of living and that she and her husband could well afford to repay the $10,000 even if they have to take out a loan or make monthly payments or even sell the 1st or 2nd home. The student/heir certainly has a right to recover what is rightfully theirs.

SINCERELY,

[email protected]