Estate Planning and Addiction – There is a Solution!

Most of us know of at least one family dealing with a substance abuse issue, and it may even be your own. As we are frequently reminded in the news cycle, the “opioid crisis” is wreaking havoc on American families and taking many lives in the process.
When the issue of addiction arises in someone’s personal estate planning, our discussion usually starts when a client says that they are not leaving anything to a particular child. I will inquire as to the reason why. When I learn that it is because of concerns about substance abuse, I can then share with them the good news that there is a way to leave assets to their child, but in such a way that the assets are protected from any of their child’s poor decisions. Most of the time this news is met with great relief and an exclamation such as, “I did not know you could do that!”
The solution is to leave the assets to a trust for the benefit of the child. If properly drafted, the trust can provide for the child’s needs, but would not be available for the child’s demands. A Trustee would have full discretion as to whether to make a distribution. The document can contain specific “substance abuse” language, even requiring the child to submit to a drug or alcohol screen at the request of the Trustee (or be ineligible for a distribution). The trust could pay for treatment, living expenses, and even for the expenses of the child’s children.
One of the most important decisions with this type of trust is the selection of the Trustee. A good Trustee ensures a successful trust administration. In these cases, the Trustee has to be firm and able to withstand the requests (and even anger) of the trust beneficiary. It may be wise to name a corporate or professional Trustee as opposed to putting a family member in this difficult role.
A well-drafted estate plan can and should address all of a family’s specific concerns. Today substance abuse issues are certainly a concern for many families. A trust can serve as protection for a child suffering from addiction and may even be a resource that can aid in their recovery.
Updating an estate plan is only one component of addressing addiction in a family.  Al-Anon can be a wonderful resource if you are dealing with a family addiction issue.  Al-Anon is a group that provides support for family members who are affected by someone else’s addiction.  For more information, visit https://al-anon.org/ .