Estate Planning for a Loved One Struggling With Addiction

In many cases, estate planning deals with difficult situations, such as how to plan for a loved one struggling with addiction. Watching a loved one battle with a substance use disorder is awful, but it’s important to remember there is hope. Recovery is possible, and with that comes a healthier, happier life. Family members who are estate planning may wonder how to help them without the funds being counterproductive, so our firm is bringing you some tips to keep in mind:

A Few Quick Tips

  • It’s advisable to refrain from giving a loved one struggling with addiction direct access to an inheritance so that they do not spend it on detrimental substances.
  • Have caution when relying on another family member to manage an inheritance on the addict’s behalf.
  • Understand that if it is a minor child battling with addiction, you can name a guardian to manage their financial affairs. However, once they come of age, they have full access to the funds unless you implement other stipulations.

Setting Up a Trust

You can tailor a trust to meet your loved one’s needs—to help your loved one rather than perpetuate the addiction. Consider the following terms:

  • They must use the inheritance for treatment.
  • The beneficiary must complete rehab, pass random drug tests, or maintain sobriety for a set time before receiving funds.
  • If they cannot meet specified incentives by a certain date, the trust’s accounts and property will pass to a different beneficiary or a charity.

Choose the Trustee Carefully

Selecting a trustee is just as important as the trust provisions for a beneficiary with addiction issues. The trustee should act in the best interests of the beneficiary while helping to maintain family harmony. Please note that the trustee can be a family member or a professional. In fact, in many cases involving addiction, the trustor chooses a trustee outside of the family unit. When selecting a trustee, consider the following:

  • The trustee can have full authority over how to use the funds (discretionary trust).
  • The trustee can pay third parties directly for approved expenses instead of giving funds to the beneficiary.
  • The trustee can communicate with other family members to track recovery.

Discuss These Estate Planning Strategies Further With Law Stein Anderson

The lack of proper estate planning for an addicted loved one could result in them inheriting a lump sum of money without restriction. It could spell disaster for their recovery and their future. Addiction is a lifelong struggle, and putting a solid plan into place for a loved one struggling with it will help them tremendously. If you are estate planning and have a loved one struggling with addiction, reach out to us today. Our empathetic and skilled attorneys will help you navigate this situation with clarity. We can even create trust funds to ensure your loved one can still access or apply for government assistance in the future. Explore these and other further options with Law Stein Anderson.