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Finances, Adoption and Reunion

We met with our financial planner last week to create an investment vehicle for our adopted daughter. Our financial planner is a very close friend of our family. As we were setting up the investment and we were going through our finances, he suggested that we put everything in our name and have it pass to a trust for her upon our death, instead of putting everything in her name directly.

My daughter's family is very impoverished due to their own choices. They have chosen to put drugs and vice above other priorities. They have conducted themselves in a way that could be seen as them being very interested in squeezing whatever money they can from us, the system, and others.

Our financial planner pointed out our adopted daughter's birth family's actions during the adoption and mentioned that our daughter would ultimately reunite with her birth family. He warned us to use our ownership and the trust as a safeguard to prevent our daughter from being manipulated into giving them money.

We are not rich, but our daughter will receive a somewhat sizable inheritance. We save for her because we want to try to do what we can to make her life easier. We have raised her to be compassionate and religious. We would hate for her family to ask her for money when she is young and does not understand that their financial situation is the result of their poor choices.

Has anyone else encountered this?

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Asked by Anonymous at 10:34 PM on Feb. 13, 2011 in Adoption

Answers (4)
  • I haven't encountered that, not having anything to speak of in terms of an inheritance, but it sounds like your financial planner is probably giving good advice.

    In my own situation, my son is inheriting absolutely NOTHING from me (at least not until he's 18, and we'll have to reassess what to do when we get closer to that age) because I don't want to give my ex any reason to try to claim custody of him. All I really have to leave anyone right now is pretty much just life insurance pay-outs, so I just put my father as the beneficiary on all the policies. I trust him to do what's best for my son. I suppose if there were more assets, I might consider a trust.

    Answer by DDDaysh at 11:07 PM on Feb. 13, 2011

  • There must be something I am missing. Unless you both are already old and anticipate dying soon, why would the money go to your daughter at an early age? Can't you specify in the trust what age the money will go to her?

    Ultimately, however, if you want to leave her money, do it, but, you cannot and should not control what she does with her money. Your daughter will learn as she is older the realities of her birth family, and make her own decisions about how to deal with them. In my opinion, if you give money to someone, you either trust them to use it in a good way, or you don't give it to them at all.

    Answer by Southernroots at 12:42 PM on Feb. 15, 2011

  • We are not old, but anyone can die at any time. Our financial planner recommends tying it up in a trust until at least age 25 or older. I don't know why that is wrong. It is not her money. We have worked and saved for it. Why is it wrong to ensure that she is mature when she inherits it? Is it better to leave it all to charity and not leave her anything at all?

    Comment by Anonymous (original poster) at 9:26 PM on Feb. 15, 2011

  • Dh had a trust fund he received at 21. I think at that age, most kids, it is impossible to be impartial about receiving a large sum of money and not waste it. Dh & I didn't meet until our late 20's, and my dh is very tight fisted with the $$. Both he & he's brother used their $ as a kind of excuse not to work even though both went to and dh graduated from university. His brother dropped out of colllege with only one semester to go and never completed.

    I think specifying an allotted amount, or dividends from a mutual fund is a good start. I agree with your finical planner on protecting her from what could be an emotional blackmail from bio family, considering she has just lost her


    Answer by liteofmine71 at 9:57 AM on Feb. 17, 2011

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