What to do when your minors are beneficiaries, from FRUGAL DAD:
If you name minors as beneficiaries of your trust and/or your IRA you face a unique dilemma.
You may want to leave money to the kids. But you may fear they don’t have the experience or maturity to make smart decisions when it comes to cash.
This can be especially difficult when there are no adults that you trust enough to put in charge of the money.
What should you do?
Let’s resolve this problem by first looking at the trust money.
If you name minors as beneficiaries of the trust, you will have to find an adult that can administer the assets (at least) until they reach the age of majority or longer. You don’t have a choice.
This person doesn’t have to be the parent or guardian of the children but it must be someone you trust and someone over age 18.
Keep in mind that you can change this person as often as you like. Your trust is a living/breathing document. Nothing is cast in stone.
You can also name a professional trustee – although I don’ recommend it.
And remember – a miracle could happen. You might live long enough for the minor to become a responsible adult. This is exactly what happens most of the time.
What I’m saying is, when it comes to your trust, don’t get worked up over nothing. Do the best you can. Name the best trustee you can. Consider this issue well while you’re drafting your trust but don’t worry about doing it perfectly. You can always make changes later.
Your IRA beneficiary is a different story. If you name a minor as a beneficiary or contingent beneficiary, special rules apply.
If your IRA beneficiary is a minor when you die, the minor must set up a beneficiary IRA (because the minor (hopefully) isn’t your spouse). Different financial institutions treat this issue in various ways.
Some companies will allow the minor to set up the beneficiary IRA. When the minor does this, she’ll have to name a “custodian” who is over 18 years of age. This is the IRA equivalent of a trustee. This custodian signs the application and makes decisions about withdrawals on behalf of the minor.
The problem is that your financial institution will probably allow your minor to name anyone he or she wants as “custodian” of the account.
You may not want this.
For example….let’s say your 17 year old daughter names her 19 year old boyfriend as custodian. Is that really what you had in mind?
I don’t think so.
The solution?
Take care of this now.
If you name a minor as beneficiary (or contingent beneficiary) in your IRA, amend the beneficiary document now. You can simply spell out (on that document) who you want the custodian to be for your minor beneficiary. While the financial institution isn’t obligated to honor your request, they probably will.
Problem solved…if you take action.
Note from Frugal Dad: Neal and I have discussed this very matter on several occasions as our family’s situation changed a bit after my mom’s death last year. We had to appoint a new trustee/guardian for our kids as part of the painful (but necessary) process of updating our wills. Because probate/estate law can vary from state to state, I highly recommend consulting an attorney and/or a certified financial planner in your area to help draft the proper documents.
7.25.2010
America's Worst Mom? Nah...listen here.
NPR's interview with Lenore Skenazy on FREE RANGE KIDS
Increase Male Testosterone Levels, Naturally
http://fitness.suite101.com/article.cfm/boost_your_testosterone_levels7.18.2010
A wedding is a singular event, lasting a few hours. Yet, a marriage is a process, made up of days, weeks, hopefully, years. Sometimes couples stay together "one day at a time," believing that things will improve or change. I support that belief. A cliche that you may have heard is, "Just don't leave the first year."
The first year was the hardest for me, and it is the hardest for many couples, especially as we marry later in life and are more set in out ways (which really means, we're more rigid in our thinking patterns.) Yet, couples that delay marriage until their mid-30's have more satisfying marriages.
Either way, most men and women want to find a mate and we continue to see marriage as the culmination of a dream: the beginning of a family, creating a lifestyle, pursuing goals with a partner.
But, yes, the economic slide affected wedding planning. Read below:
Either way, most men and women want to find a mate and we continue to see marriage as the culmination of a dream: the beginning of a family, creating a lifestyle, pursuing goals with a partner.
But, yes, the economic slide affected wedding planning. Read below:
"Weddings remain a multibillion-dollar industry and summer is the busiest season. There were about 2.2 million weddings in 2009, with each event averaging 128 guests, according to The Wedding Report Inc., a research company that tracks the wedding industry. But the wedding business may slowly be eroding in the fragile economy. The average cost for a wedding dipped in 2009 to about $19,500 from a peak of $28,700 in 2007, said The Wedding Report Inc. So far this year, wedding spending has improved -- with the economy -- to an average of $23,800.
Read about the new trendy, Bowling Alley Wedding. I like it!
From Frugal Dad, "8 Critical Steps Every Family Should Be Taking"
http://networkedblogs.com/5b6j77.08.2010
Can you predict divorce? Marriage Expert, John Gottman, PhD presents well-research proof of important factors to improve, save, enjoy your marriage
http://www.youtube.com/watch?v=rqzK5mfNlRc&NR=1
http://www.youtube.com/watch?v=1e8x6yKAUTk&feature=related
http://www.youtube.com/watch?v=1e8x6yKAUTk&feature=related
The Joys of Daydreaming
Happiness keeps you healthy
The Teen Brain: (listen)
6.29.2010
Divorce Mediation Versus. Litigation: Mediation is an affordable alternative to court for resolving all family law issues, before, during, and after the divorce or legal separation. Both parties meet with a trained, impartial family law mediator, to resolve issues in a confidential setting. The mediators are family law attorneys who help you reach your own agreements on issues of custody, child and spousal support (alimony), and/or division of assets and debts. The mediator provides substantive information about divorce laws and court procedures so you can make reasonable decisions for yourselves. An agreement is finalized when you are both satisfied with all of the terms.
WHAT IS MEDIATION?
Mediation is a process for handling issues in which the parties involved voluntarily meet with a trained, impartial mediator, to resolve these issues. Mediation sessions are informal but structured discussions guided by the mediator, to help clarify the issues and move the parties toward their own agreements. The topics that will be addressed include: division of property (assets and debts), support (child and/or spousal) and/or issues about children.
Mediation is a process for handling issues in which the parties involved voluntarily meet with a trained, impartial mediator, to resolve these issues. Mediation sessions are informal but structured discussions guided by the mediator, to help clarify the issues and move the parties toward their own agreements. The topics that will be addressed include: division of property (assets and debts), support (child and/or spousal) and/or issues about children.
Don't Alienate The Kids! Raising Resilient Children While Avoiding High Conflict Divorce
$19.95 In this new book, Don't Alienate the Kids!, Bill Eddy presents a new theory of child alienation in divorce. In his theory, there are no bad parents – just bad behaviors, many of them inadvertently by many people including family, friends, professionals and the family court adversarial process. All of these bad behaviors combine into "1000's of Little Bricks" that build a wall between a child and one or his or her parents. The goal of the book is to explain all of the little behaviors (little bricks) that parents and professionals should avoid, and all of the little behaviors (little bricks) that they should use to build this Foundation.
$19.95 In this new book, Don't Alienate the Kids!, Bill Eddy presents a new theory of child alienation in divorce. In his theory, there are no bad parents – just bad behaviors, many of them inadvertently by many people including family, friends, professionals and the family court adversarial process. All of these bad behaviors combine into "1000's of Little Bricks" that build a wall between a child and one or his or her parents. The goal of the book is to explain all of the little behaviors (little bricks) that parents and professionals should avoid, and all of the little behaviors (little bricks) that they should use to build this Foundation.
Divorce Blog:
http://divorcefamilylawmediation.blogspot.com/
6.21.2010
6.15.2010
Birthdays Without Pressure, Duct Tape, and Plugged in Parents
"If you think children’s birthday parties are getting out of control, you’ve come to the right place." Stop the madness.
Give Dad a Duct Tape Wallet - I've made one. It's really cool - and really gray!
Parents are getting timed-out by their smarter kids!
http://www.nytimes.com/2010/06/10/garden/10childtech.html
6.06.2010
Love, American Style
Americans are sexy too! The U.S. ranked second in a recent poll, second only yo Austria in sexual satisfaction. Japan and Taiwan placed last. Researchers concluded that gender-equality leads to more partner pleasure. Long-term couples do, in fact, report their carnal desires to their partner.
Here's the skinny on real divorce rates (lower than you commonly hear!)
Time celebrates photos of couples married 50+ years.
Here's some how-to's for enjoying your partner.
http://zenhabits.net/slow-relationships/#more-6198
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