Trust Fund Questions
There are a wide range of benefits that can be included in a trust fund. Aside from cash, the trust could also include stocks, bonds, or property. Generally, the trust fund is managed by only one trustee; however, there can be arrangements that allow for more than one. The trustee is in charge of ensuring that the trust fund is used for the best interest of the recipients listed in the trust fund. Below are some of the more commonly asked trust fund questions that have been answered by Experts.
I have some money in a trust fund, which is controlled by another family member. In making my will, am I free to leave that money to whomever I choose, or will the one controlling my trust gain possession of it, when I die?This will depend on the wording of the trust agreement. You should be in control of how the money is distributed at the time of your death if you are just waiting for the money to be distributed to you. However, if the trust states that you have control of your money while you are living, but returns to the control of someone else upon the event of your death, you wouldn't be able to leave the money to someone in your will.
My aunt is in charge of my student trust fund. She is not paying the School fees and I cannot attend class without fees being paid. What can I do?If your aunt is the trustee of your trust fund, she has a fiduciary duty to handle the trust and have your best interest in mind while maintaining the terms of the trust. This means she is supposed to follow the rules of the trust agreement to the letter.
You would have a right to file suit for damages against your aunt if she isn't being compliant with the trust agreement. You can also request an account of the trust assets if you feel there is reason for it. Generally, all it takes is someone to retain an attorney to draft a demand letter. However, if a demand letter from an attorney doesn't clear things up between your aunt and the trust, you may have to file a suit against the aunt and ask the court to name a new trustee of the trust fund if there isn't one mentioned in the trust.
Can you put a lien on a trust fund?Usually, most trusts have a spendthrift clause attached to them protecting them from the beneficiary from pledging or assigning funds that would be received in the future. The trustee is the only one who can make any form of payment, and this is usually discretionary. So to answer your question, under most all circumstances, you cannot put a lien on a trust fund.
As the executor of my mother's trust fund, is there a standard allowance allowed to the person handling her financial affairs?The person who is in charge of administering the trust is usually allowed a reasonable compensation. Usually, there isn't a specified dollar amount but the pay will be based on the duties that you perform, the time spent, and the difficulty of those duties. As long as the amount that you collect is comparable to the amount that would be charged in the private sector, that amount should be considered reasonable.
As the sole trustee for a trust fund set up for my mother, is it legal for me to give money to my sister who is in a financial bind?Unless the trust fund allots for money to be distributed to your sister out of the trust fund, you cannot give her money from your mother's trust fund. The only way this would be possible is if there is language in the trust that states that you have the authority to give funds to the decedents of your mother. Usually, this type of language will not be found in a trust fund. Before attempting to give your sister money from your mother's trust fund, you need to read the trust very carefully. Without the explicite wording of the trust allowing you to give your sister money, you won't be allowed to do so.
A trust fund is a financial arrangement that is set up to provide benefits to an individual. These can be very beneficial, but if handled incorrectly can become a financial nightmare. Before you take matters into yo0ur own hands or if you just have questions about a trust fund, you should always ask an Expert.