moral/ethical dilemma regarding trust fund spending

[Anonymous]

So jealous!!!

Do it OP, for all the reasons above. And also for all of the little people that can only dream of such a gift. Life is too short to be wasted in a car.

[Anonymous]

OP, you are in a position of good fortune and should enjoy it. My parents are depending on us heavily for financial support due to some tragic and unforeseen medical issues.

I can only imagine how nice it must be to have this tremendous gift from your dad. Yes, do talk it over with him and respect his guidance.

[Anonymous]

Go for it- enjoy what you have. I'm sure your family is delighted to be able to share their wealth with you and help you enjoy your life.

[Anonymous]

Anonymous wrote:I am one of those lucky people who have family money. My father set up a trust for his kids a few years ago, and we are able to "borrow" (well, really take money) from it. Here is my dilemma: we currently live in suburb (similar to vienna in terms of commute to DC). I SAH (not using $$ from trust, simply on DH's salary), DH works in DC. We have 1 child, another due in the spring. Our house is great, there are certainly some things we would change about it if we could, but certainly nothing that would precipitate a move anytime soon. However, DH's commute is terrible, and with the build-up of tysons, it's just going to get worse. He is not in a job where he can telework, so he needs to travel to DC every day. With the money in the trust, we could easily afford a house in mclean or arlington, but unless we are wanting to come down pretty far from our current house, we would be spending a lot of money-over $1 million (I know there are many houses out there for less, but my point is that for what we are used to, that would be the housing range-STARTING housing range-we would be looking at).

Part of me is horrified at the mere idea of using money that I/we did not earn to buy a house in excess of $1 mil. I feel like that is the height of frivolous...we already have a pretty darn great life with what we have. On the flip side, having DH's commute lessened would be wonderful...he would love to spend more time with DD (soon to be DD and DS), I would love to see more of him, as he leaves often prior to 7 and doesn't get home until after 7 due to traffic. And what is the money there for if not to use? There will be plenty left over for college education and even private school education k-12 even if we borrow a hefty chunk for a new house. I just have a hang up that it's ridiculous, and we're looking at houses that would be bought not on our own merit (that being said, we bought our current house with my parents' help before the trust was created, but only needed a small amount to help, nothing like what we are talking about now).

WWYD?

If your dad is alive....ASK HIM.

He set it up, and he is your best counsel.

Frankly - if you are my daughter - I'd be annoyed that you'd ask nameless faceless strangers on the internet give you financial advice - AND be annoyed that you'd do that, instead of asking me. Your dad already let you know of the money's existence - so ask him what he'd do. It will help ease your mind.

FWIW - my children will have mid 7 figure trusts as adults - but they know nothing of it now. I want them to struggle a bit and live life. I want them to go through the "struggles" of putting a roof over their own heads, food on the table, and educating their children. It's NOT easy and IMO it shouldn't be. It builds character - and it builds family unity and bonds and love. Money can destroy all that in a heartbeat. Unlike most posters here - I think the money is NOT just "to have an easier life". As Warren Buffett theory says - it should be enough that they can do almost anything, but not enough so that they'll do nothing. There is a small piece of your post that indicates that you're tapping the wallet in order to take the easy way. I hope I am wrong.

There is a tremendous weight and responsibility with money IMO. And I applaud you for at least having a questioning conscience about what to do. To me - if it is as much money as you seem to infer - perhaps just use the income that the trust generates (not the corpus) and use it to pay for annual mortgage. Don't invade the corpus...it will reduce the long term benefit.

But overall - ask your dad - he set it up, and he knows you 100 times better than any of us. Good luck kiddo.

Signed,

A similar Dad

[Anonymous]

I would do it, but I would also very clearly document exactly how much of your trust money went into this new house. I lost inheritamce money in my divorce because I could not "trace out" my separate propery in my divorce.

[Anonymous]

If your dad is alive....ASK HIM.

He set it up, and he is your best counsel.

Frankly - if you are my daughter - I'd be annoyed that you'd ask nameless faceless strangers on the internet give you financial advice - AND be annoyed that you'd do that, instead of asking me. Your dad already let you know of the money's existence - so ask him what he'd do. It will help ease your mind.

FWIW - my children will have mid 7 figure trusts as adults - but they know nothing of it now. I want them to struggle a bit and live life. I want them to go through the "struggles" of putting a roof over their own heads, food on the table, and educating their children. It's NOT easy and IMO it shouldn't be. It builds character - and it builds family unity and bonds and love. Money can destroy all that in a heartbeat. Unlike most posters here - I think the money is NOT just "to have an easier life". As Warren Buffett theory says - it should be enough that they can do almost anything, but not enough so that they'll do nothing. There is a small piece of your post that indicates that you're tapping the wallet in order to take the easy way. I hope I am wrong.

There is a tremendous weight and responsibility with money IMO. And I applaud you for at least having a questioning conscience about what to do. To me - if it is as much money as you seem to infer - perhaps just use the income that the trust generates (not the corpus) and use it to pay for annual mortgage. Don't invade the corpus...it will reduce the long term benefit.

But overall - ask your dad - he set it up, and he knows you 100 times better than any of us. Good luck kiddo.

Signed,

A similar Dad

To the Dad,
(I'm the PP who received the 300K for the house).

Awesome advice, and I can tell you are a great Dad. You remind me a lot of my dad. He didn't tell me until a few years ago (I'm 38) that I would be inheriting significant amounts of money (several million) and I am so glad I didn't know until then. At the same time, I am glad he told me when he did. I needed time to get used to the idea, and I am still getting used to it. I do hope you include your kids on your plans, at least to the extent you think they can handle it, and give them some time to digest it. I know some kids couldn't handle it at all, or maybe now isn't the right time. But I can tell you, as someone who had no clue this would eventually happen to me, I needed time to digest it because it totally rocked my world. And I've also had some extremely rich (no pun intended) and heartfelt conversations with my parents since they've told me. They also expect me to give a significant portion to charity, which I am really looking forward to doing. In some ways, I wish I could quit my job now and just give away their money! : )

Just thought you'd like to hear that perspective. All the best to you and your kids.

[Anonymous]

PP, why did it come as such a surprise that you would inherit a significant sum? Were you not aware of how much your parents had saved? Or is this old money that they had not touched?

This is a fascinating thread. It is so far outside the realm of my reality.

[Anonymous]

I haven't read the other replies, but just wanted to say that we live in Arlington and we got made fun of by a lot of people for wasting money for living here. Those same people now complain to me regularly about all the money they are spending by living further way. They spend more on commuting, car maintenance, and/or childcare (because of time). And by reading on here, people with long commutes end up spending money on housekeepers, lawn services, cooks, convenience foods and eating out a lot. I'm not insulting them in any way, I'm just saying we've found premium we paid for a house to be well worth it. We save in other ways due to having a short commute (mine is 10 freaking minutes). Now, we did buy a smaler house and we "paying" by not having the space we need. But if you can afford a nicer house, why woulnd't you buy one. The odds of it going down in value in the Arlington area is slim. Its a good investment.

[Anonymous]

Use the money! Your husband will never regret spending more time with his kids.

[Anonymous]

Hell yeah, spend that bitch!

[Anonymous]

Those of you who are getting money from your parents are so fortunate- I wish we were. Congratulations, and count your blessings! I say again- use this to benefit your lives NOW with a prudent investment like a close-in home. Tomorrow is not promised; make your lives better today. You won't be sorry.

[Anonymous]

OP, is this money that you are sharing with siblings at all? Or is it truly legally your money?

[Anonymous]

Who gives a rat's rearend? Only the nueveau riche talk about such things in public. Well bred people do not brag about money or position. Some of your trust fund money would be well spent on an indepth course of decorum, public and private.

[Anonymous]

Anonymous wrote:PP, why did it come as such a surprise that you would inherit a significant sum? Were you not aware of how much your parents had saved? Or is this old money that they had not touched?

This is a fascinating thread. It is so far outside the realm of my reality.

This is the PP. I just had no idea they had saved that much and been blessed with their investments. My parents live modestly and we've always been a put it in the bank, don't be flashy with money, live modestly and give away to charity kind of family. (And it's only been in the last few years that I've gotten a little more insight about how significantly my parents have been giving money away -- they had always kept that secret from me).

I just never thought about inheritance either. I just assumed if I inherited it wouldn't be a lot and that I should save aggressively for my own retirement, which I always have done. They've lived in the same house for over 30 years, and only in the last 5 years did they get their first really "nice" car -- Mom got the smaller Lexus SUV and only because she really liked her friend's car, and at the time, I howled and said it was wasteful and she should have gotten a Honda!

Dad's last car was a Ford Taurus, but he has a Toyota wagon now. He could care less about what he drives. I guess I started to wonder a little when they bought a second home several years ago, but it's not a mansion, and again, the big picture on that scale just didn't occur to me. I guess if you'd asked me at the time they bought the second house, I might have said, well, maybe I'd inherit a few hundred thousand when they die, but several million never would have occurred to me. Perhaps that is naive, but because my family was frugal growing up (even though I did go to private school), and my parents never talked about their salaries or net worth, I guess I always assumed we were "comfortable" but nothing more. And I assumed that was how it always would be. There's a book called the Millionaire Next Door -- my parents are very much like that -- very under the radar, not flashy. I honestly didn't know a thing until about two years ago Dad said "we've been doing some planning and we might start a charitable foundation..." and I about fainted. Later, through my suggestion, we found a better way to handle it instead of a foundation (less hassle and more anonymous), so the deal is I am going to give away a bunch of it after they die. I really am excited about that, and that's going to be my fun hobby in my retirement, and I am so honored to do it.

Even now, I still don't know how much they have, and I am fine with that. Besides it could change a lot between now and the time they die. I kind of had to drag it out of my dad that it was several million. The responsibility of it was kind of making me crazy, so I just had to know, ballpark, if we were talking 1 or 2 or 5, or what!?!?! He's pretty tight lipped and conservative, so my guess is anywhere up to 10M, but again, it could change, particularly if we have to spend a lot on healthcare as they age, or if some other disaster occurs. Also about $1M of that is going to a disabled sibling in a special needs trust that I will administer.

[Anonymous]

Hi- I have nothing to contribute but I did want to say thanks to the OP and many of the other PPs for allowing me to day dream along with you. This is really far out of my realm and it is kind of fun to think about