HAPPY BIRTHDAY! HERE IS $100,000. How would you feel if your 18 year old received this cash????
The teenage years are hard enough for the teens as well as the parents and grandparents. Do not add to the complication of that time of growth and discovery. Make sure you never name minors as beneficiaries!
In my personal and professional life, I have experienced the pain of the failure to plan firsthand. I want to share Grandpa Joe’s story with you to ensure that I have done my best to educate you and hopefully inspire you to plan so that your loved ones can avoid these horrible situations.
Grandpa Joe passed away suddenly. He had an investment account with $100,000 in it at the time of his death. He had named his 13 year old granddaughter Laura as the beneficiary on that account.
Laura’s parents John and Jane contacted the investment company; however, the investment company refused to share any information with the parents about the account including the balance.
John and Jane had to hire an attorney to file a lawsuit (attorneys’ fees, court costs, delays, loss of control, public nature of proceeding) and ask the court to appoint them to be in control of that money for Laura since she is a minor (under 18). The parents had the choice to post a bond (aka purchase a type of insurance policy to be able to use the funds for Laura) or they had to keep the money in an account fully controlled by the court.
This means that if they want to use the money for Laura, they must hire the attorney to file a request and schedule a hearing for the judge to decide how and when to release money (the parents have to spend more money to gain access to the money from the investment account).
Even worse, on her 18th birthday, Laura will be given the $100,000 without any restrictions or oversight. Most people do not believe that an 18 year old is responsible enough to handle that money wisely.
Since the court process is public, there are people that can discover this fact and befriend Laura in an attempt to defraud her of this cash.
All of this can be avoided with simple planning ahead of time!!!!!
If you are ready to take action to save your family from the costs, stress, and emotional turmoil of a failure to plan (or an outdated plan that fails when you need it), use the following calendar link to book your Estate Planning Session: https://mklegalplanning.as.me/estate-planning-session
Let’s continue our conversation! Comment below, send me a message, or call us.
The choice of a lawyer is an important decision and should not be based solely upon advertisements. This publication is for informational purposes. Nothing in this publication is legal, financial, or tax advice. MK Legal Planning recommends that you consult with an accountant or other tax professional in conjunction with an attorney to form an advisory team. This publication does not create an attorney-client relationship with the firm or its attorney. © 2019 MK Legal Planning.