Irrevocable Trusts impact on FA?

[Anonymous]

Good grief. Most people have no clue what they are talking about and the sheer nonsense is hilarious because I'd wager most people in a similar position would be asking the same question.

Without looking at the trust, it became irrevocable upon the mother's death. Pursuant to what the OP posted, the terms of the trust state that the children will receive their money inheritance when they turn 25. It isn't the children's money until they turn 25, it is the trusts. Further, there appears to be what is know as a HEMS standard (distributions can be at the discretion of the trustee to maintain the beneficiaries health, education, maintenance and support). It is not an "education" trust because an education trust would spell out that the funds are to be used for education for the beneficiaries. But, instead it is up to the reasonable discretion of the trustees on whether to make a distribution for education.

Thus, the trustee is doing exactly what the trustee should be doing when they have a fiduciary duty. And remember, the trusts goal (according to the OP) is to turn over funds to the GC when they turn 25. Thus, the trustee is asking the OP to take the correct action by asking the OP to file for financial aid and insert all the information requested. If questionnaire asks about "discretionary" irrevocable trust information, then you supply it. If it doesn't, you don't and let the school make the determination on whether OPs kids are eligible for financial aid or not.

If the school decides to provide financial aid that is fine. If the school doesn't provide aid because of the trust information was supplied (or not supplied), OP goes back to trustee and says they'd like the trust to make a distribution to continue the maintain the GC at their current school. The trustee can then make the call or not to make a distribution. Or, the OP can forget about it and pull their kids.

The fact any poster on here is outraged about this question is amusing to say the least.

[Anonymous]

So the OP can at any time request that the trustee make a distribution to support the beneficiaries’ educational needs? Or the OP can let the school assume they still need FA knowing that (1) they don’t and (2) they are taking money from a student who does.

[Anonymous]

Anonymous wrote:Good grief. Most people have no clue what they are talking about and the sheer nonsense is hilarious because I'd wager most people in a similar position would be asking the same question.

Without looking at the trust, it became irrevocable upon the mother's death. Pursuant to what the OP posted, the terms of the trust state that the children will receive their money inheritance when they turn 25. It isn't the children's money until they turn 25, it is the trusts. Further, there appears to be what is know as a HEMS standard (distributions can be at the discretion of the trustee to maintain the beneficiaries health, education, maintenance and support). It is not an "education" trust because an education trust would spell out that the funds are to be used for education for the beneficiaries. But, instead it is up to the reasonable discretion of the trustees on whether to make a distribution for education.

Thus, the trustee is doing exactly what the trustee should be doing when they have a fiduciary duty. And remember, the trusts goal (according to the OP) is to turn over funds to the GC when they turn 25. Thus, the trustee is asking the OP to take the correct action by asking the OP to file for financial aid and insert all the information requested. If questionnaire asks about "discretionary" irrevocable trust information, then you supply it. If it doesn't, you don't and let the school make the determination on whether OPs kids are eligible for financial aid or not.

If the school decides to provide financial aid that is fine. If the school doesn't provide aid because of the trust information was supplied (or not supplied), OP goes back to trustee and says they'd like the trust to make a distribution to continue the maintain the GC at their current school. The trustee can then make the call or not to make a distribution. Or, the OP can forget about it and pull their kids.

The fact any poster on here is outraged about this question is amusing to say the least.

The fact that you and other posters are endorsing OP’s inclination to seek FA they don’t need but another student does need is unsurprising to say the least.

Wonder just how many families who get FA at your private or OP’s are less than forthcoming with their school about what they can actually afford.

[Anonymous]

Anonymous wrote:Good grief. Most people have no clue what they are talking about and the sheer nonsense is hilarious because I'd wager most people in a similar position would be asking the same question.

Without looking at the trust, it became irrevocable upon the mother's death. Pursuant to what the OP posted, the terms of the trust state that the children will receive their money inheritance when they turn 25. It isn't the children's money until they turn 25, it is the trusts. Further, there appears to be what is know as a HEMS standard (distributions can be at the discretion of the trustee to maintain the beneficiaries health, education, maintenance and support). It is not an "education" trust because an education trust would spell out that the funds are to be used for education for the beneficiaries. But, instead it is up to the reasonable discretion of the trustees on whether to make a distribution for education.

Thus, the trustee is doing exactly what the trustee should be doing when they have a fiduciary duty. And remember, the trusts goal (according to the OP) is to turn over funds to the GC when they turn 25. Thus, the trustee is asking the OP to take the correct action by asking the OP to file for financial aid and insert all the information requested. If questionnaire asks about "discretionary" irrevocable trust information, then you supply it. If it doesn't, you don't and let the school make the determination on whether OPs kids are eligible for financial aid or not.

If the school decides to provide financial aid that is fine. If the school doesn't provide aid because of the trust information was supplied (or not supplied), OP goes back to trustee and says they'd like the trust to make a distribution to continue the maintain the GC at their current school. The trustee can then make the call or not to make a distribution. Or, the OP can forget about it and pull their kids.

The fact any poster on here is outraged about this question is amusing to say the least.

If you think OP/your/trustee's approach is perfectly fine and not worthy of outrage, then OP should have the guts to be open about the trust and the approach they are taking with financial aid. Because, surely, the non-amusing people will completely understand.

[Anonymous]

Anonymous wrote:Good grief. Most people have no clue what they are talking about and the sheer nonsense is hilarious because I'd wager most people in a similar position would be asking the same question.

Without looking at the trust, it became irrevocable upon the mother's death. Pursuant to what the OP posted, the terms of the trust state that the children will receive their money inheritance when they turn 25. It isn't the children's money until they turn 25, it is the trusts. Further, there appears to be what is know as a HEMS standard (distributions can be at the discretion of the trustee to maintain the beneficiaries health, education, maintenance and support). It is not an "education" trust because an education trust would spell out that the funds are to be used for education for the beneficiaries. But, instead it is up to the reasonable discretion of the trustees on whether to make a distribution for education.

Thus, the trustee is doing exactly what the trustee should be doing when they have a fiduciary duty. And remember, the trusts goal (according to the OP) is to turn over funds to the GC when they turn 25. Thus, the trustee is asking the OP to take the correct action by asking the OP to file for financial aid and insert all the information requested. If questionnaire asks about "discretionary" irrevocable trust information, then you supply it. If it doesn't, you don't and let the school make the determination on whether OPs kids are eligible for financial aid or not.

If the school decides to provide financial aid that is fine. If the school doesn't provide aid because of the trust information was supplied (or not supplied), OP goes back to trustee and says they'd like the trust to make a distribution to continue the maintain the GC at their current school. The trustee can then make the call or not to make a distribution. Or, the OP can forget about it and pull their kids.

The fact any poster on here is outraged about this question is amusing to say the least.

As a lawyer, no, I do not find OP's underlying intent amusing at all.

[Anonymous]

OP clearly doesn't appreciate the FA she has now if she's willing to let other families donate to cover the costs of her well-endowed kids.

[Anonymous]

Anonymous wrote:Hey I got news everyone - it's the professionals push that we should subsidize FA with the fund. Not us. That's why I'm asking!

Seriously - $1M is not a lot of money. If we tap it for 6 yrs of school + college, they have very little at age 25. The question is whether we should tap it for education at all given that we are receiving FA. The banks tell us we should most definitely protect the money as much as possible but still use it if it takes the pressure off us financially as there is actually a reason we receive FA. Even with FA, we struggle. It's not like we are millionaires. I like how you all think it's our money but it isn't. We would really like our kids to benefit as much as possible with it. However it's education and kinda the definition of benefit at this time. I think if any of of you were in this our position you would be wrestling with whether to use it on education or not, it's much easier to sit in judgement, I get that.

And to the idiot that wonders ow I know my kids are beneficiaries since I was estranged from my mom - hey Sherlock - as guardian of the beneficiaries, I'm legally bound to be told. You are a moron for even asking this question! We do have to find a 3rd party Trustee long-term once the estate is settled thus we are not in control of any of this money but hey, according to these "professionals," we should leverage the fund to our benefit as a family.

I will no longer be reviewing this thread as none of you have experience obviously.

$1M is not a lot of money? Are you serious? There are kids who have nothing. Not even 1k in a bank account. There are so many kids who hope to get aid or they can’t go at all. There isn’t infinite aid. Other kids could be turned down for FA that your kids, with trust funds, will get.

[Anonymous]

Isn’t the financial aid question, “are you the beneficiary of a trust…?”

And, your kids are.

[Anonymous]

Anonymous wrote:Isn’t the financial aid question, “are you the beneficiary of a trust…?”

And, your kids are.

But OP is not. Her children are 10 to 13 years old.

[Anonymous]

SmartTuition asked about trusts. When you answer yes it asks more questions including if the trusts are restricted, revocable, irrevocable, etc

Every school has pulled levers on their side depending on what they care about. You have to answer truthfully and we have no idea how the school factors this into their calculations (we dont even know what school you're talking about)

[Anonymous]

Anonymous wrote:

Anonymous wrote:Isn’t the financial aid question, “are you the beneficiary of a trust…?”

And, your kids are.

But OP is not. Her children are 10 to 13 years old.

NP, it asks that. it asks if your kids own real estate. it asks if your kids own any stocks. it asks if kids NOT APPLYING to the school have any stocks or property in their name (ie you put the stocks in the toddler's name). It asks all this stuff very explicitly .

[Anonymous]

it asks if you have vested stock, unvested stock, if you have insurance settlement payment plan or are party to a lawsuit.

PEOPLE THEY ASK IT ALL

[Anonymous]

So then it's between OP and the school. Why is everyone jumping to the conclusion that OP plans on lying? Nothing OP has said sounds like she's planning on doing anything illegal.

[Anonymous]

Private school and a million dollars. You definitely need financial aid.

[Anonymous]

Anonymous wrote:So then it's between OP and the school. Why is everyone jumping to the conclusion that OP plans on lying? Nothing OP has said sounds like she's planning on doing anything illegal.

No one accused OP of lying. That part of this discussion is an ethical one, not a legal one. And yes, people can respond that way if they want to.