$$$ car for trust fund kid?

[Anonymous]

I’d give my teen the distribution and also make them take some kind of financial literacy class I guess. Sounds like things are out of your hands pretty soon. FWIW my kids don’t get their trust until they’re in their 30s and I have a lot of control until then. But I fought my parents to write it that way.

[Anonymous]

My family has a weird collection of trusts and insurance policies … with the order of deaths and trustees being a bit different than expected by those who set it up. My younger cousins who received access to money young have spent a lot on odd things but are ok it seems. The older cousins who haven’t received a dime have actually been totally independently successful.

But we’re just one family and none of us knew there was money coming or now what really to do with it.

[Anonymous]

Op here. The trust transfers to the teen at 18 per the orphans court in the state where they reside. I’m the court-appointed trustee. The car is $20,000.
I’d rather let the judge decide to approve/deny the request and maintain good relations with the teen (and their parent) instead of trying to convince them to delay or reduce the amount. They have about $450k in total.

[Anonymous]

Anonymous wrote:

Anonymous wrote:If the trust is set up in batshit fashion to give tons of money to an 18 year old, maybe let them get whatever they can 'afford' and start learning natural consequences.

This!

My kids don't get control of their trust until they are 37 - when spending habits are established and maybe they need tuition for their kids

That’s too old. Unless they can use the interest or the interest/principal yearly as needed.

[Anonymous]

Anonymous wrote:Op here. The trust transfers to the teen at 18 per the orphans court in the state where they reside. I’m the court-appointed trustee. The car is $20,000.
I’d rather let the judge decide to approve/deny the request and maintain good relations with the teen (and their parent) instead of trying to convince them to delay or reduce the amount. They have about $450k in total.

If their parent agrees, I would allow it. Or, maybe compromise at a $10K car.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What genius set up such a trust?

According to my financial advisor, MOST people. I was stunned. He said the majority of trusts turn over to an 18 year old.

Bullsh-t. Percentage at 18, more at 25, more at 40, more reserved to generation-skip.

Why not just say, “I think your advisor is mistaken” or “That’s not what I’ve heard”? This sort of hostility seems a bit unhinged.

How dare you police my tone. LOLCATS

[Anonymous]

Anonymous wrote:What genius set up such a trust?

The Trustee said the trust was created under the directions of the Orphan’s Court or maybe his parent’s Will? I think anyway. He becomes an adult at 18, that might have something to do with it.

I don’t think $20,000 is unreasonable for a car. They have gone way up in price and you want it to reliable.

[Anonymous]

Anonymous wrote:

Anonymous wrote:What genius set up such a trust?

The Trustee said the trust was created under the directions of the Orphan’s Court or maybe his parent’s Will? I think anyway. He becomes an adult at 18, that might have something to do with it.

I don’t think $20,000 is unreasonable for a car. They have gone way up in price and you want it to reliable.

This. A used Civic or Corolla will be perfect.

[Anonymous]

The average price of a new car is $48k right now. $20k is a very reasonable amount to spend on a first car— that’s what 4-5 year old Corolla with 40-50k miles is going to cost.

Whether the teen should buy a car is a different question but if they are prepared to pay for gas, maintenance and insurance and the trust allows it then arguably it is the kind of expense the trust was set up to cover.

[Anonymous]

Op here. Thank you for the helpful responses.

[Anonymous]

Anonymous wrote:I’m not sure where to post this.

Teen with trust fund wants $$$ to buy their first car within the next three months. Trust fund will transfer completely to teen in about 12months. If you were trustee, what would you do?

My friend got access to her trust at 18 but knew she also had to use it for all college expenses. She bought a used Toyota Camry and a nice laptop. She was pretty responsible!

[Anonymous]

$20k for a car is reasonable with today’s prices. You should have led with that, OP. You made it sound like the teen wanted to blow their trust on a Ferrari.

[Anonymous]

They will live and learn. It's not your money.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:What genius set up such a trust?

The Trustee said the trust was created under the directions of the Orphan’s Court or maybe his parent’s Will? I think anyway. He becomes an adult at 18, that might have something to do with it.

I don’t think $20,000 is unreasonable for a car. They have gone way up in price and you want it to reliable.

This. A used Civic or Corolla will be perfect.

I would never let my children drive a used car. A new one is far safer. You never really know how abused a used car is, after all. Bad investment.

[Anonymous]

Anonymous wrote:Op here. The trust transfers to the teen at 18 per the orphans court in the state where they reside. I’m the court-appointed trustee. The car is $20,000.
I’d rather let the judge decide to approve/deny the request and maintain good relations with the teen (and their parent) instead of trying to convince them to delay or reduce the amount. They have about $450k in total.

OMG, that is not an expensive car! You are acting like it is a luxury vehicle.