How should an estate plan disbursement be structured?

Question

I have one child and am trying to decide how to disburse a sizable estate in the event of my death.

Answer 1

Update your will.
Update your beneficiary info (insurance, retirement accounts, etc.)

I would add a trust clause to your will to make sure the money went into a trust account for the benefit of your child at your death if your child was still young when you pass (under the age of 28-30).

With the trust clause, the money would be dispersed to your child in sections (not all at once). Trickling it out every 5 years or so is often a good option. For example: 33% at age 21, 50% of what's left at age 25 & finally close the trust and dispurse the ramaining 100% at age 30.

Also, make sure you allow the money in the trust to be used for emergencies your child may incur (health, etc.). Don't forget about education costs and such too.

Answer 2

Estate plans can be set-up however you'd like it to be, and it can be as easy or as complicated as you want it to be. Depending on the age of your child and/or their maturity level, you may want to consider placing everything in a trust fund with an appointed guardian until your child reaches an age you feel would be appropriate for them to inherit "a sizable estate" (like 25 years old, maybe?). You could authorize the guardian to be able to make withdraws against the trust fund for your child's educational expenses, living expenses, ect. until they reach the age you've selected -- that way your child could still attend college, but wouldn't burn through all the money at "frat parties" while getting an education. That way the bulk of the money would be available to him/her after graduation while they're starting their adult life. From personal experience, I would recommend placing someone from your bank, your insurance agency or your law firm as the guardian -- someone without family ties. Your friends and family will be just as traumatized by your death as your child is, and they may or may not make rational decisions in the days and weeks following your death.

Answer 3

For children I like the concept where the estate is broken into thirds and separated by five to seven years. This allows the recipient to grow and mature between dispersements. An example would be 33% at age 20, 33% at age 25 and 33% at age 30.

Answer 4

You probably need to talk to a probate attorney, as you'll want to set up a trust for your child, along with a guardian. You don't want some random idiot getting custody of your child, AND having complete access to the sizable estate. They'll run through your money, and your little darling won't end up with a thing.

Answer 5

If you have a "sizeable estate" you should setup a TRUST!!!! There is no better way.

I highly recommend USAA Trust Services (if you qualify) OR
U.S. Trust

Many large national banks such as Citibank, Chase, Wachovia, etc. also have trust departments

Answer 6

Funny! 100!