I am over 65 and have been living alone now for six years. How can I organize my estate so there is little or no potential for my will to be contested? In brief, I would like to have my potential executor take care of this. I feel it is absolutely necessary to leave about 90% of what I have to just one grandchild. They are almost 18.
I would like the executor to offer guidance for further distribution to their siblings when that grandchild is 25. At that time, the executor would decide which, if any, sibling is OK to be given money. Yes, the situation is extreme with the other grandchildren. Otherwise, I would not do this. I plan to update my will by June.
The Grandmother
Dear Grandmother,
Don’t leave your estate planning in the hands of your executor.
Your will should be very specific, naming all those included and/or excluded. The executor of your will would be in charge of carrying out your wishes in probate, but you would have to set up a trust with a trustee/managing agent to oversee the terms of the trust. Those terms should not, if at all avoidable, be open to interpretation. They should be crystal clear.
The best way to ensure your will (or trust) is not contested is to write it while you are of sound mind, so no one can accuse another beneficiary of undue influence or say you did not have the testamentary capacity to write such a legal document. It should be written under the care of a trust and estate attorney and have the prerequisite number of witnesses.
Some states also have ‘in terrorem’ clauses stating that any beneficiary who contests the will automatically forfeits their right to inherit anything.
The legal framework that determines whether a trust or will is valid varies by state. In all U.S. states, a will must be signed by at least two credible witnesses. But some states allow handwritten wills under certain circumstances. It would be a mistake to have a family attorney who is not an expert in trusts take care of your estate planning.
Another reason for someone to contest a will or declare it null and void: the person forgets to sign it. You would be surprised at the number of wills that have the most obvious mistake, rendering them null and void, thereby making a will that could have been written 20 years prior valid instead, and changing the entire landscape of the estate.
Some states also have “no-contest” or “in terrorem” clauses stating that any beneficiary (assuming you leave your other named grandchildren a token amount) who contests the will automatically forfeits their right to inherit anything. This is enforceable as long as the aforementioned reasons are not grounds for contesting the will (such as fraud).
Special-needs trust
Similarly, a special-needs trust is typically set up for someone with special needs, mental-health issues, mental disabilities and/or somebody with substance misuse issues. In other words, they cater to beneficiaries who may not be capable of managing an inheritance. For instance, it may stipulate that the beneficiary needs to submit to drug testing before receiving funds.
Any trust should be written with clarity and specificity, especially if you have — for example — children or grandchildren with substance-abuse issues. “Many parents and grandparents are choosing to follow the ‘recovery model’ when creating a trust, which means that the trust addresses their addiction and recovery head-on,” says Carosella & Associates.
A special-needs trust is typically set up for someone with special needs, mental-health issues, mental disability and/or somebody with substance misuse issues.
Such stipulations, the law firm says, may include the following provisions: “The trustee will only authorize distributions if the beneficiary is earnestly pursuing treatment and recovery. Distributions will be based on the treatment plan as written by the beneficiary’s treatment team; however, the trustee has final distribution authority.”
“Although you may want to allow for the trust to fund living costs such as rent and food, considering incentives such as vacations or a car when your beneficiary reaches specific goals is usually a better idea than providing cash as an incentive,” it says. “Putting cash in the hands of someone with a substance use disorder often leads to relapse.”
“You may even want to specify that any tangible assets in the trust may not be sold for cash,” the law firm adds. “The trustee will have to monitor these goals, and should also have the ultimate authority to determine whether they have been met using reasonable objective and subjective criteria.”
You’re not the author of your grandchildren’s destiny, but you can help.
You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com, and follow Quentin Fottrell on X, the platform formerly known as Twitter.
The Moneyist regrets he cannot reply to questions individually.
Previous columns by Quentin Fottrell:
‘Frankly, I’m terrified’: I’m 63 and nearing retirement. How should I invest my $80,000 inheritance?
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