What Should I Do About an Irresponsible Heir?
Aug. 1, 2023
Many parents often try their best to raise their children rightly, make them responsible, and eventually become self-sustaining. However, things don’t always turn out as planned.
In some situations, a child with special needs may require assistance for their personal care and financial matters. Conversely, some children often become irresponsible due to substance abuse, addiction, or laziness. Thankfully, a spendthrift trust allows parents to protect the inheritance and make adequate provision for their irresponsible heir’s needs.
At Michael A. Siefert, P.A., I have an abundance of experience handling estate planning matters involving irresponsible heirs. As a reliable Florida estate planning attorney, I can inform you about your possible options to protect your children’s inheritance. My firm proudly serves clients across Ocala and Marion County, Florida.
Examples of an Heir Who May Be Irresponsible
An irresponsible person is someone without any proper sense of responsibility. In most cases, irresponsible heirs are either unable to act on their own or do things without adequately thinking about the potential consequences. Some common examples of an heir who may be irresponsible include:
Special needs child
Children with substance abuse or drug addiction issues.
A child that is too young
An heir that doesn’t want to work
A child that doesn’t value their possessions.
Unfortunately, irresponsible heirs have a lack of sense of duty or responsibility to themselves and others. They are unable to succeed in their education, relationships, and careers. Likewise, they’re incapable of making informed financial decisions and may end up squandering all their inheritance. Therefore, it is the responsibility of the parent to establish a trust or estate plan to help protect the irresponsible heir’s inheritance.
Establishing a Trust that Protects the Inheritance
As a parent, it is completely normal to be worried about your irresponsible heir, especially when you’re unavailable or unable to make decisions for them. Among the possible options to protect their inheritance is by establishing a spendthrift trust and stating the purpose of the trust.
A spendthrift trust, also known as supplemental needs trust, is a vital estate planning tool that allows parents (trustors) to limit the control and access of the beneficiary over the trust asset. In a spendthrift trust, the trustee will name a trustee who will manage the trust property and money, even after the parent is gone.
Since all activities of the trust go through the trustee, the beneficiary will be unable to transfer, sell, or give out their inheritance and interests in the trust property. Also, the spendthrift trust allows you to regulate how money and assets will be transferred to the irresponsible heir.
Generally, you can protect the inheritance by preventing the beneficiary (irresponsible heir) from having direct access to the trust property. This may require setting up the spendthrift trust with instructions to only pay for the beneficiary’s home, medical treatments, and other life essentials and give monthly stipends.
The Role of the Trustee
The trustee plays a crucial role in administering and managing the spendthrift trust. Here are some of the duties and responsibilities of the trustee:
Receive trust property for the beneficiary’s benefits.
Make money and assets available to beneficiaries according to the trust provisions.
Establish a timeline for transferring payments to the beneficiary.
Decide the appropriate conditions to withhold or approve payment requests.
Ensure trust benefits are used properly and judiciously.
Handle all the beneficiary’s financial matters and maintain an accurate record.
Determine how to pay for products and services for the beneficiary.
Pay all bills, expenses, and administrative fees incurred during trust administration.
Set aside a reserve fund to cover other estate or trust-related expenses.
A dedicated Florida trust attorney can tell you about the trustee’s role, help create the spendthrift trust, or explore your other available legal options to protect your irresponsible heir’s inheritance.
Non-Monetary Assets
There are other possible ways to protect the inheritance of an irresponsible heir – asides from spendthrift trust. These include:
Giving your child a house to live, but making the property part of a trust.
Paying off some of their debt.
Setting up an annuity.
529A ABLE (Achieving a Better Life Experience) Savings Plan.
A seasoned lawyer can enlighten you about the benefits and limitations of each option and help you make informed decisions.
Skilled & Knowledgeable Guidance
When you have a special needs child or irresponsible heir, protecting their inheritance is crucial. At Michael A. Siefert, P.A., I have the diligence and expertise to advise and direct clients through the complexities of estate planning for irresponsible heirs. I will proudly analyze your unique situation and explore your possible legal options. Whether you want to create a spendthrift trust or protect your child’s inheritance using other methods, I can guide you through the legal procedures involved, help you navigate key decisions, and ultimately achieve peace of mind.
Reach out to me at Michael A. Siefert, P.A., today for a consultation with a practiced estate planning lawyer. I can work diligently to address your needs and concerns and help you make informed decisions in your estate planning matters. My firm proudly serves clients across Ocala and Marion County, Florida.