How Do I Make Sure My Executor And Trustee Know What I Want Them To Do For My Children?
Many people are helping their children financially, both while they are under 19 and often well into their adult years.
We routinely prepare Wills and Trusts that are intended to look after our clients’ children, both before and after adulthood. Most Wills contain trusts for money a child will be entitled to under an estate, until the age of 21 or 25 or beyond. I had one client insist her son was still not able to handle his own money, and when I asked her his age, she said: “60”!
Wills also usually provide that the trustee has the discretion to advance for the benefit of that child prior to the date when the child receives all of the capital. The standard wording in the Will allows for advances for education, health care needs, maintenance and general benefit. How does the trustee know what your wishes are for advances to the child before they receive all the capital?
You can add directions in your Will as to your specific wishes, but if you have concerns or directions which you would like to keep private, a better way of providing the direction is by a Letter of Wishes. Your Will becomes public information when Probate is obtained, and all beneficiaries must receive a copy of it, so they will all see your directions. A Letter of Wishes does not become public, as it is just for the eyes of your trustee, and it can be added to or modified more easily than changing your Will.
Your lawyer can help you draft a Letter of Wishes, or you can write a letter to your trustee yourself, which you keep with your copy of the Will. The kinds of directions you might give include whether:
- your trustee should advance sufficient funds to permit your child to attend post-secondary education, including costs of room and board;
- you would like funds advanced to buy a car, if the trustee thinks appropriate (but not a hot car!);
- the trustee can advance money for a down payment on a house, if the choice seems appropriate to your trustee;
- the trustee can advance money to start up a business, if the trustee thinks appropriate;
- the trustee can advance money for travel;
- if the children are under 19, whether the trustee can advance to the guardian funds for the renovation of the guardian’s house or for the purchase of a larger vehicle.
The Letter of Wishes can specify the standard of living you would like your trustee to provide for your child, and can specify anything for which you definitely don’t want the trustee to advance money.
Your children do not need to see the Letter of Wishes, so privacy of your wishes/reasons can be assured.
In addition to writing a Letter of Wishes, in a trust that carries on for some time, be sure to choose a trustee whose discretion you trust, who gets things done, and who is a good communicator. Your lawyer can help you with advice on these matters.