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This year this blog is following a hypothetical couple through their lives to see what role estate planning had on their family. To review prior blogs on this story, go to SeamonLawOffices.com/Blog. This hypothetical story is based on having worked with over 1500 families over the past thirteen years, but it is not based on a specific client.

Last month we discussed a young couple I worked with named John and Sue as they established their initial estate plan as the parents of young children. Years later, the couple came back to the office with some concerns over their daughter, Mary. Mary had dropped out of college and was not making good decisions.

We spent some time catching up on what else was going on in their lives at the time. John, Sue and their children were all pretty healthy. John and Sue were hoping to pay off their home soon and had built up quite a bit of money in their qualified accounts (IRAs, 401ks, etc.). Her parents were now in their late 70s, but her grandmother had passed on.

As we discussed their current concerns, they were not interested in a living trust to avoid probate when they passed away, they were just really concerned that if something unexpected happened to them, that Mary would not manage her inheritance wisely and even more unsettling for them was that they were worried Mary might be taken advantage of; therefore, protecting Mary and her future inheritance was their primary goal.

I reminded them that they had some protection for Mary because she would inherit her share of their estate in trust with Sue’s brother serving as trustee. Their current estate plan would give Mary her inheritance through a trust and the trustee would have the ability to use the assets to help Mary, but she had the right to withdraw her inheritance one-third at a time at ages 25, 30 and 35.

Sadly, Mary was already 25 years old, and they did not think her decision-making would improve in the foreseeable future. I provided them a variety of options ranging from a strict trust that never would provide Mary a right to withdraw any sum, all distributions would be at the trustee’s discretion, or to just provide Mary the trust income, or to adjust the ages or length of time after they die before Mary would have that right to withdraw the assets. All of these options would provide Mary additional time to mature.

This was a difficult conversation for John and Sue, they admitted they had put our meeting off for quite some time. I explained that I was glad they were addressing the issue now while they were both able to participate on their solution, as difficult as it was to work through, it would be even more difficult for the survivor of the two of them to do so. They explained that they worked hard for what they have so it would be a shame for it to be wasted, and even worse if the inheritance ended up causing harm to Mary.

In the end, they felt better knowing they faced this decision together, they agreed that if Mary consistently maintained employment and managed her finances so that she was no longer asking for assistance that they would revisit their decisions. But for now, they felt at peace with their decision to restrict Mary’s access to her future inheritance.

They noted as they left that they were so relieved that they had planned as a younger couple so that these decisions to adjust their plan felt less stressful.