$$$ car for trust fund kid?

[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.

[Anonymous]

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.

Agree. There is no way a “majority” turnover at 18. Forbes says the most common structure is payouts at 25, 30 and 35.

[Anonymous]

$20K is the price of a very basic, non-luxury vehicle, OP.

Why did you make us think the teen wanted to buy a Ferrari?

[Anonymous]

Anonymous wrote:$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.

NP
That was my assumption too and I could see op was in a tough bind but given this new info, op is slightly a jerk to consider being a roadblock

[Anonymous]

If you’re not sure and you have the option to ask a judge I would, personally, but you really just need to look at the specific documents that are supposed to be governing you.

[Anonymous]

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.

I’d get a new advisor.

[Anonymous]

A used$20k car or brand new under warranty $30-40k Honda, say, that won't need a tuneup for 100,000 miles and can be kept 10 years easily?

[Anonymous]

I think $20K is low for a car if they need one.

[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?

I assume you are responsible for remitting reasonable expenses.

If it's a minor with a legal guardian, follow the advice of guardian. They may prefer a loan (even if it gets laid off shortly after initiation).

If it's an adult, do you have any right to withhold the funds? Buying a car is within the realm of normal expenses. Get info on how much the car costs exactly, and write a check to the seller.

[Anonymous]

Anonymous wrote:

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?

I assume you are responsible for remitting reasonable expenses.

If it's a minor with a legal guardian, follow the advice of guardian. They may prefer a loan (even if it gets laid off shortly after initiation).

If it's an adult, do you have any right to withhold the funds? Buying a car is within the realm of normal expenses. Get info on how much the car costs exactly, and write a check to the seller.

$20k. The car the kid wants costs $20k

[Anonymous]

Anonymous wrote:

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.

Right? Long past college, creative peak, dating market, marriage and kids. Better than nothing, obviously, but that would be harsh.