September is National Substance Abuse Awareness Month and a smart time to consider estate planning where a beneficiary has a substance abuse disorder. Did you know that a trust can be a great choice for many parents to provide for their child beneficiary with a substance abuse disorder, as the trustee can oversee the spending of the money to assure the money is not used in furtherance of the beneficiary’s substance abuse, but rather, is used to support their recovery?
One of the most important aspects of creating a trust for a beneficiary with a substance abuse disorder can be the selection of the proper trustee. While parents, as grantors, can work with a qualified estate planning attorney to draft clear provisions for how the trust should be disbursed, ultimately, whether the goals of the trust are met, can come down to the decisions made by the trustee.
Grantors have several options when selecting a trustee:
- A trusted family member or friend: This trustee would be most likely to have the beneficiary’s best interest at heart. A beneficiary with a substance abuse disorder may, however, during relapse, put increased pressure on this trustee to disburse funds. Not only could this be an uncomfortable position for the trustee, but it should be considered whether the trustee will be able to withstand the emotional pressure.
- Institutional Trustee: A bank or a professional trustee can be elected. With the special set of challenges presented by a substance abuse disorder, however, it should be considered whether an institutional trustee will have the experience, time, and willingness to address the needs of the beneficiary.
- Special Needs Trustee: There are social workers and other healthcare workers, who can serve as special trustees. These professionals can often be in the unique position to balance the concerns presented by the personal and institutional trustees.
Every family has unique circumstances. Our office can offer counsel on the appropriate selection of a trustee and answer other questions you may have. Contact us today to schedule a meeting.