Wednesday, February 13, 2013
Here we have a a common occurrence. We have an aging mother and her three daughters. Two of her daughters are married but have no children. One has a teenage son and is divorced. The divorcee and her son have lived with the mother in her condo for sometime but has not contributed financially to the household. As it stands now, if their mother were to pass away all three daughters would take equally from their mother. Now, the mother has entered an assisted-living facility. The daughter that was living with her is still residing at the condo, and has finally started to pay the bills at home.
One of the other daughters is afraid that the daughter that lives at home is pressuring their mother to pay for her nephew's college education. The other daughter is worried because she thinks that her nephew will not be able to complete a four-year college education program and that her mother will squander this money. She thinks that her mother should hold making any gift until her nephew can mature a bit. The conflict also arises from the fact that one daughter feels that it is wrong for her sister to ask for a separate slice of the money especially because that sister has been irresponsible and has already asked a great deal from their mother. As usual, this family could probably benefit from the advice of a good estate planning attorney. The attorney would likely be able to determine how best to provide the grandson with money to college but ensure that he is responsible with his money. A trust with an independent trustee might be the best solution for the grandson in this case.
In this case, some would argue that "it's quite audacious for the sister to push her ailing mother to pay" especially because she could probably pay for her own son's education with her share. Some would also argue that it is important for other potential heirs to voice their concerns if they believe that one potential heir is taking advantage of an aging parent. Unfortunately though, it is important for everyone to remember that the money ultimately belongs to the parent and they will decide how they will spend that money.
See Michelle Singletary, Who's Right In This Family's Financial Fight?, Washington Post, Feb. 9, 2013.
Special thanks to Naomi Cahn (John Theodore Fey Research Professor of Law, George Washington University School of Law) for bringing this article to my attention.