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SENIOR ADVOCATE

By Liza Horvath

 

A Mother’s Love

 

When Raymond was born, his parents were joyful and expectant of a bright future for their only son. Ray, however, grew up a troubled young man. By age 12 he had failing grades and, by age 15, Ray had left school altogether. Falling in with a gang, Ray continued to pursue nefarious activities until, at age 19, he was arrested and convicted of a felony – landing him in a California State prison. 

 

Ray’s parents, Flo and Richard, were understandably devastated. Flo would visit her son often but Richard refused to go – he considered his son a total loss. When Ray was paroled, Flo and Richard took him in and tried to get him to return to school. Two-weeks after his release, Ray robbed a store at gun point and went back to prison.

 

Flo and Richard have concluded that they will see their son free again – they are now seniors and will die before Ray is up for parole again. As any mother, Flo does not want to give up hope that her young son will realize the opportunities he could have and turn his life around. Flo also wonders what to do with the sizeable estate that she and Richard have accumulated – they have no grandchild – and now no child – that could be benefited by their years of saving and investing.

 

Having a child in prison presents unique challenges in estate planning. Flo and Richard want to benefit Ray, if possible, but how? If they leave their estate to him and he is still in prison – how does that work? If he will never get out of prison, it seems it would be a waste to tie up funds for some day off in the future – a day that may never come. So what can they do?

 

There is another concern, also. Presently Flo makes regular contributions to the Inmate Trust Fund and Ray uses these funds to buy toiletries, food and other items at the on-grounds prison “canteen.” These small items make Ray’s day-to-day existence somewhat easier. What will happen when Flo and Richard are gone? Who will make deposits into Ray’s canteen account?

 

It took some creativity, but Richard and Flo set up a trust agreement that gives clear instructions to their trustee to do the following: After Richard and Flo die and as long as Ray is incarcerated, the trustee will make contributions each month to the canteen of $25 dollars and the amount would adjust from year to year to keep up with inflation. If Ray is paroled, the trustee will pay for an apartment and provide a monthly stipend to him for food and expenses. If Ray wants to pursue an education, the trustee will support such a pursuit. When Ray has lived outside prison for 5-years without being arrested again, the trustee can give him all of the trust assets and end the trust. If Ray dies in prison, the trustee is to give the trust assets to two charities that Flo and Richard have supported during their lifetimes.

 

Flo continues to hope for a miracle which may never come but at least she now has the peace of mind in knowing that when she and Richard are gone, the trustee will make the trip to the prison monthly to check on Ray and make sure he has access to the canteen.

 

Liza Horvath has over 30 years’ experience in the estate planning and trust fields and is a Licensed Professional Fiduciary. Liza currently serves as president of Monterey Trust Management. This is not intended to be legal or tax advice. If you have a questions call (831)646-5262 or email liza@montereytrust.com

 


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