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Discussing Finances And Wills With Young Adult Children

Discussion in 'Miscellaneous in Parenting' started by Laks09, Jan 20, 2021.

  1. Hopikrishnan

    Hopikrishnan Gold IL'ite

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    That was from #3 of this thread. Holding their attention for a spell to describe something and confirming that it all went in and got registered is a challenge.

    It is not good to try and stuff it all in one go. I have no advice on how any parent should approach this, because the children are all custom-made. Having a dependable friend of the parents to help the child in a critical situation is good for expat families living far from their home countries.

    If there is to be a useful tangent to this thread, it is to ask how/where one had found a trust-worthy friend who may advise your impressionable child without you having to vet and amend whatever the child receives. What if you haven't got such a friend or relative? -- is another thing altogether. Would IL members advise how to get one :innocent:?

    How about fire-drills ? Many of us would have this experience at work, especially in K-12 schools, and some large employers' with blue & white collar outputs in the same location. Once in a while, there will be a call for everyone to behave as if there is a fire, earthquake, or some sort of evacuation emergency, and the immediate response will be observed, recorded, audited and improved upon. I wouldn't advise running an actual simulation on an adultish child; however, the parent (who is even a half-Rihana) could sit in a quiet spot, and run a mental simulation of the sequence of things to happen in an emergency. Have a notepad to write down what Jr. and/or Missy would likely do. You will come up with possible improvements for your specific situation. Don't harangue the kids afterwards about your machinations. Dispense hugs all around, and be happy. If you must, google your questions, or have one of those bed-mate chats in the wee hours of the morning. Always good for a laugh.

    Obviously we assume the married couple to be totally trusting one another. If this is not the case, the financial planning for the beneficiaries is more complex and difficult.
     
    Last edited: Jan 23, 2021
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  2. Laks09

    Laks09 Staff Member Finest Post Winner

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    Hopi,
    I’m glad I started the thread. I got a lot of things I needed from your responses. Some stuff like adding to lockers and TOB hadn't even crossed my mind! I have to do this ASAP.
    I’m also contemplating a joint checking account with emergency money. She can manage to do that very well!
    I don’t have a Godrej Almirah in this country. I loved mine and hate that I don’t have anything to lock my valuables in. I guess it’s also time to research some lockers for the house!
     
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  3. Laks09

    Laks09 Staff Member Finest Post Winner

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    I have someone in mind. I’m going to ask her soon enough if she will step in.

    You know, I’ve been asked this question a million times by special needs moms. I don’t have an answer. My answer has always been to lean into the family. To look at siblings and cousins and start building that relationship now.

    For typical children, all this while, I thought it wasn’t a big deal. Now that I give it more thought, lots of questions are coming up! I should start a related thread!

    Thank you for all your inputs. I wish there was the love button or the Bernie button on here for your responses!
     
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  4. Hopikrishnan

    Hopikrishnan Gold IL'ite

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    IMO, the youngish sort of desi guy in America, not trusting his wife with "his earnings", even though they have children together is the underlying problem to create that norm. :rage: I meet a few such specimens in desi gatherings, and I want to slap some sense into the idiots. Women are usually in another herd, reinforcing the cluelessness into one another. That too is so bothersome. Teaching adultish child is one problem, but straightening out a childish adult is another sort of problem that childless couples have.
    besides the normal big causes of sudden demise we already know about (cardiac arrest, auto accident, cancer...) there is now Covid-19 that could kill someone in about 3 to 4 weeks.
    • Medical bills, funeral costs, come up right away
    • Home mortgage/rent payments, utility payments, food costs come up after that
    • and so on.
    Some US hospitals place a lein on the patient's house when there is a bill yet to be paid. Even in seller's markets, and community property states, where a house can be sold by a surviving spouse in just one afternoon, this lein would make it difficult to sell. If there are no provisions for continued mortgage/rent payments, the survivor would end up with that liability. Life can become so complicated.

    Girls who do not go out to work on their own, even in the most affectionate of married lives, must contemplate their situation, and become a little more savvy. One day the biggest of life's problem would be "idlies don't puff", and the next day the whole world would seem to be shouting at the woman:pensive: in Swahili.
     
    Last edited: Jan 23, 2021
  5. Laks09

    Laks09 Staff Member Finest Post Winner

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    You said girls but other than that, I qualify under this bucket. I haven’t contemplated beyond being aware of assets/having a will/having access to passwords and such. Is there more I need to do? I’m joint in everything except the house in India that mom insisted had to be in the son’s name alone. Do I need to be more savvy? I’m willing to be. DH is also willing to do whatever it takes to make me independent from day 1 if the need arises. He has given me instructions on what to do when but it’s hardly comprehensive.
     
  6. Hopikrishnan

    Hopikrishnan Gold IL'ite

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    I am slowly responding to each of your concerns. Some of your concerns would require you to read on your own, and find out if/how they are relevant to your children. I can give some links. You may find other similar links if you google.
    Post-Death Administration in the Age of Access by Password

    Just like the mutual trust between the married twosome, the trust and affection between beneficiaries (usually sibling children) can be very helpful for a smooth transition of wealth across generations. If there is lack of complete trust between siblings, the legal teams representing each combatant would eat the estate. There is an aesoph story on this theme.
     
  7. Hopikrishnan

    Hopikrishnan Gold IL'ite

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    joint in everything, eh? You are good to proceed on to a fire drill I had described above. When everyone is out, you can sit home, and do the exercise. Ignore the house in India (illiquid as well as far away is pretty much useless for the short term).

    Goal: Life moves on pretty much the same for the short term ~ 1 to x years. Many would already have monthly expenses data. This is useful.
    Scenarios: One grownup absent, Both grownups absent.

    Use worksheet if you need to. List assets, who owns, how fast it would transfer to remaining top leader of pack. Assume pack-leader would have supporting grownup counsel.

    You are merely looking for gaps, oversights, lack of information, and even uncertainties you can tolerate. You may easily gather information later (from your employers, from internet, or from banks/brokers or wherever) to improve the situation.

    Do it when family is out for a longish spell in a day, you have tea (or whatever you drink to calm nerves) and a quiet time with yourself & the worksheet, notepad. Many get a bit jittery in doing this; perhaps it is the reason wills are made, put away somewhere, and not ever looked at ever again. Insurance policy sellers usually have an audit like this with potential clients. However, such audits would go stilted in a certain direction. When you do it on your own, you are merely trying to fill information gaps.... for an efficient response if an emergency ever happens.
     
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  8. Laks09

    Laks09 Staff Member Finest Post Winner

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    I’ll do this and keep the spreadsheet handy. Thank you very much!
     
  9. Rihana

    Rihana IL Hall of Fame

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    RLT - Revocable Living Trust.

    Home and any other real estate
    An RLT is usually created only if the family owns real estate. So, the home is for sure incorporated into the RLT. For this, the house deed is modified and re-recorded with the county recorder's office. The homeowners on the deed become "John Doe and Janet Doe Revocable Living Trust." Each time a refi happens, most lenders require the house to be taken out of the RLT temporarily and put back in after the refi is done. They promise to put it back but might not. It is very important to look out in the mail for the notification from the county recorder about house being taken out of the trust and being put back into it.

    Bank and brokerage accounts
    These can be made part of the RLT. The process is fairly straightforward, done individually for each bank or other account, and is usually done soon after the will/RLT are created. Typically, when drawing up the RLT documents, you tell the attorney which accounts will be part of the RLT (give names of bank or brokerage and last four digits of a/c numbers). Then, you yourself work with each bank and brokerage account to transfer it to the RLT. This can be a simple step in the bank's online portal or a bit more involved. Be sure to enter the name of the RLT correctly (given our longish Indian names and the common first name/ last name swap confusion.)

    If any bank or brokerage account is not made part of the RLT, the ToD (transfer on death) option takes care of the money going directly to heirs and avoids probate. So, for major accounts, either make them part of the RLT or check that the ToD option is enabled and up to date. We left some accounts out of the RLT - for example the account from which we get checkbooks. We didn't want to pay to get new checkbooks : ) and I didn't want our names on the checks to show up as "yada yada Revocable ..."

    Retirement and deferred compensation accounts (including 401K, IRA's)
    These are not part of the RLT. In fact, they are explicitly excluded from it in the section where the RLT's items are listed.

    Other property
    Automobiles, jewelry, works of art, personal effects, furniture, Kanjeevaram sarees, tangible personal property or anything located at the primary residence are also listed as part of the RLT. I gather any similar property can be added here. Like a stamp collection, gun collection. : ) I don't think this covers stuff in bank lockers. This section is to list major tangible items located at the primary residence.

    Does an RLT need to be updated and what does it cost
    It needs to be updated if things like beneficiary or successor trustee or other terms need to be modified. So, when the older child turns 18, parents might choose to update it. If getting it done with the same attorney, the cost might be less. If a new attorney is doing it, they ask for and use the old RLT docs, but charge the same as creating a new RLT. The reason is that most have their own "template" and will not just amend the old RLT.

    To avoid the need to update the RLT when one's child turns a certain age, I think the successor trustee can be specified as "friend-name till child-name turns n years old"

    RLT need not be modified if a new property, bank account is to be added to it. The new item can be made part of the RLT by titling or other modes. In other words - listing a house, bank account etc as part of the RLT in the RLT documents is just to make it easy to know what all are in the RLT. They actually become part of the RLT only when each one is separately processed with the respective institution.

    Is the RLT officially registered?
    To our surprise, no. The RLT need not be "registered" anywhere though it can be. Usually, the documents are drawn up, signed and notarized and then stored in a safe place that the required people can easily access when you are gone. This "safe place" should not be one like a bank locker that needs your permission to access. : ) The beneficiaries and the successor trustee (usually your friend, relative, adult child) should know where the documents are located. Ideally, they should be familiar with the contents of the RLT. Going over the RLT with them in your lifetime is a good idea. As the RLT does not have any dollar amounts information, going over it with the successor trustee or (almost) adult child should not be a problem. Leaving a print copy of this Nolo book along with the RLT documents would be a kindness the survivors will deeply appreciate: The Trustee's Legal Companion - A Step by Step Guide to Administering a Living Trust.
     
    Last edited: Jan 24, 2021
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  10. Rihana

    Rihana IL Hall of Fame

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    Will try to write about this on Monday. I have it in emails to friends, have to edit some portions.
     
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