Divorced parents, trust fund

[Anonymous]

Anonymous wrote:The only thing I'd worry about is if the parent in the trust dies while the children are still minors, there should be some mechanism that allows the ex to access funds to be used for the children but which may necessitate using the money in the ex's name. For example, the ex loses their job and needs money to pay the mortgage, food, and utilities which benefits the children. I would expect the parent would have to fully account for those uses.

The mechanism is inbuilt with a trustee. Ours is a bank. The co-parent would go to the bank with a reasonable request for XX expenses for the kids. If the trustee (bank) deems it reasonable, they get the money.

[Anonymous]

Ex does not get anything. Too bad. Of course the children will be richer than the estranged parent, who cares?

[Anonymous]

Anonymous wrote:

Anonymous wrote:The only thing I'd worry about is if the parent in the trust dies while the children are still minors, there should be some mechanism that allows the ex to access funds to be used for the children but which may necessitate using the money in the ex's name. For example, the ex loses their job and needs money to pay the mortgage, food, and utilities which benefits the children. I would expect the parent would have to fully account for those uses.

The mechanism is inbuilt with a trustee. Ours is a bank. The co-parent would go to the bank with a reasonable request for XX expenses for the kids. If the trustee (bank) deems it reasonable, they get the money.

I’d be really hesitant to set this up. The ex is going to take advantage.

[Anonymous]

Whaat? Why can't old have a trust fund? It can be set up for the kid, pay for college, a down payment on a house etc...

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My parents used to gift both exH and I. When we divorced their entire gifting strategy and trust strategy changed. My ex was abusive he could have previously killed me for my portion and enjoyed spending it all and more on new partners.. He tried and failed. Now it’s a descendants trust and gifts are only made to family not spouses. My children are already much wealthier than my exH.

Well, wealthy in money. Not so wealthy with the parents they were stuck with.

Luckily they have a great mom, and lots of money. Save your pity for kids who have neither.

If your husband were abusive as you say, your kids deserve pity too. Money doesn't solve the trauma they lived. It will be there forever. I'm one of those kids amd yes I feel sorry for kids who experience what I went through. BtW my parents don't see my trauma and now I don't talk to them, so be careful in how you deal with your own rich kids. Money doesn't fix your bad parenting.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The only thing I'd worry about is if the parent in the trust dies while the children are still minors, there should be some mechanism that allows the ex to access funds to be used for the children but which may necessitate using the money in the ex's name. For example, the ex loses their job and needs money to pay the mortgage, food, and utilities which benefits the children. I would expect the parent would have to fully account for those uses.

The mechanism is inbuilt with a trustee. Ours is a bank. The co-parent would go to the bank with a reasonable request for XX expenses for the kids. If the trustee (bank) deems it reasonable, they get the money.

I’d be really hesitant to set this up. The ex is going to take advantage.

Banks are actually very strict about this, which is why I didn't select a family member. I think family is more likely to take advantage and an entity that will never benefit. Plus they are used to these situations, where people try to steal money from kids.

[Anonymous]

Anonymous wrote:A couple is divorced. A grandparent is planning to make their adult child and grandchildren beneficiaries of a substantial trust. Would you set it up to also benefit the ex-spouse? Co-parenting is amicable but obviously, they’re divorced. It seems unworkable for the children to have way more assets than one parent, right? How could a trustee referee that situation?

No only no but Hell no! You are divorced and former inlaws owe you zero! In fact, they should include something that prohibits you from profiting in any way from the trust.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The only thing I'd worry about is if the parent in the trust dies while the children are still minors, there should be some mechanism that allows the ex to access funds to be used for the children but which may necessitate using the money in the ex's name. For example, the ex loses their job and needs money to pay the mortgage, food, and utilities which benefits the children. I would expect the parent would have to fully account for those uses.

The mechanism is inbuilt with a trustee. Ours is a bank. The co-parent would go to the bank with a reasonable request for XX expenses for the kids. If the trustee (bank) deems it reasonable, they get the money.

I’d be really hesitant to set this up. The ex is going to take advantage.

Banks are actually very strict about this, which is why I didn't select a family member. I think family is more likely to take advantage and an entity that will never benefit. Plus they are used to these situations, where people try to steal money from kids.

I disagree with this poster about using a bank employee as a Trustee, but I do think the answer is that the beneficiary spouse needs to be really thoughtful about who they name as an independent trustee, if they have that power. Because the ex spouse in most cases can request distributions for the benefit of the minor that can go directly to the parent, and in many cases the Trustee will have broad discretion.

Which isn’t necessarily bad. But you might not want it to be your brother in law.

[Anonymous]

Anonymous wrote:WHAT???? I am so confused. Most people do not leave money to their children-in-law MUCH LESS their ex-children in law???

What the heck is an ex-children in law? The grandparent is creating a trust for his adult child and his grandchildren. And why is the OP even asking about it. It’s the grandfather’s decisions to make and I can’t imagine him putting the ex-spouse in as a beneficiary. That’s nuts.

[Anonymous]

Anonymous wrote:

Anonymous wrote:A couple is divorced. A grandparent is planning to make their adult child and grandchildren beneficiaries of a substantial trust. Would you set it up to also benefit the ex-spouse? Co-parenting is amicable but obviously, they’re divorced. It seems unworkable for the children to have way more assets than one parent, right? How could a trustee referee that situation?

Huh? No. The ex-spouse has zero part in any of that, period. They are divorced. What the ex-spouse's children inherit from their other parent's side of the family is none of the ex-spouse's business.

+1

[Anonymous]

Anonymous wrote:This has the sound of a crazy ex spouse hoping for some $$$$ to come their way.

There is no situation on earth where it makes sense to leave money to an ex son/daughter in law

I’m getting divorced and my parents are gleefully ensuring that STBX is cut out of everything. They actually made me send them a copy of my new will excluding STBX so i can stay in their will. Otherwise they were going to bypass me and just have the will direct everything thing to my kids to ensure there’s no way for ex to inherit. In that case, my kids would end up being my significantly wealthier than me and that’s just fine.

How did your parents address if something happens to kids keeping ex out bc if something happens to kids the ex is part of next of kin and would benefit.

[Anonymous]

Anonymous wrote:

Anonymous wrote:This has the sound of a crazy ex spouse hoping for some $$$$ to come their way.

There is no situation on earth where it makes sense to leave money to an ex son/daughter in law

I’m getting divorced and my parents are gleefully ensuring that STBX is cut out of everything. They actually made me send them a copy of my new will excluding STBX so i can stay in their will. Otherwise they were going to bypass me and just have the will direct everything thing to my kids to ensure there’s no way for ex to inherit. In that case, my kids would end up being my significantly wealthier than me and that’s just fine.

How did your parents address if something happens to kids keeping ex out bc if something happens to kids the ex is part of next of kin and would benefit.

I’m not the previous poster but this is really really easy to address.

The family trust is set to benefit the grandchildren. If the grandchildren die, then it would go to their closest blood relatives.

Even if the ex spouse successfully murdered his exwife, his children and their grandparents and aunts and uncles, the family trust would go to the next closest blood relative. Probably a second cousin twice removed or something similar.

There is no scenario where the ex-spouse gets the trust.

[Anonymous]

Anonymous wrote:No my parents did not put my spouse in the trust when we were married much less would they my ex-spouse.

Agree. My husband's family didn't put me in either. I asked them not to - the reason is everything should go to their grandkids. I didn't put DH in the trust I set up for my kids either - why? I'm independently wealthy and he doesn't need my money either.

[Anonymous]

I know of several situations where the kids have a significantly higher net worth than their parent due to trusts from their grandparents. No, an ex-spouse does not get an inheritance from someone who is no longer related to them just so that his ego isn’t bruised that his kids have more money than he does.

[Anonymous]

Anonymous wrote:A couple is divorced. A grandparent is planning to make their adult child and grandchildren beneficiaries of a substantial trust. Would you set it up to also benefit the ex-spouse? Co-parenting is amicable but obviously, they’re divorced. It seems unworkable for the children to have way more assets than one parent, right? How could a trustee referee that situation?

Why on earth would the ex be a beneficiary? You are greedy and crazy.