From an attorney’s perspective, the key is tracking what the surviving spouse did with the money. If he/she simply treated the money as his/her own – and spent it however he/she saw fit, huge problems await down the road. You see, the minute the first spouse died, the trust was set in stone. Rules became important. Sadly, these rules are rarely followed – and the kids lose out. Here is what should be done…
If you are such a kid – the beneficiary of a family trust – and you don’t know for sure what’s going on in it, seriously consider having a qualified attorney do a “trust review” for you. Most of the trusts we investigate are not being administered correctly – costing the kids tens of thousands, hundreds of thousands, even millions of dollars. A qualified attorney (and a forensic accountant) will usually do the review for a flat rate, normally under 2% of the trust value. And, if problems are uncovered, you can then discuss whether it makes sense to have the attorney help you iron out the problems.
Trust mismanagement is a huge problem. To make matters worse, most probate/trust attorneys have no idea what they are doing in this field because most probate/trust attorneys are not litigators – they just don’t know how to play hardball in court to protect the kids – ensuring that they don’t get hammered.
Keep your eye on this problem. It’s going to explode.