Keep the House or Sell It?Sep 25, 2023
The question recently came up from a breadwinner father going through a divorce. In revising his estate plan, should he have the trustee sell the house and use the money to support his children, or have the house stay in trust for the ex and children to live in until the kids are grown? The answer I usually give to this type of question is don't choose either. Leave the decision up to your trustee.
If you have people you really trust, whose judgment you really trust, and who can work well with your ex to make sure the kids get everything they need, then it is common to leave the house and estate to the children, in trust, and leave the specific choice of letting the ex raise the kids in the house or sell up to the successor trustee depending on the circumstances at the time. Then discuss your goals with not only your first successor trustee, but the backup(s) as well. This avoids potential pitfalls of a forced decision on your trustee.
If the youngest is in their senior year of high school, forcing the sale of the home could force your child to change schools because, even with financial support, the ex may not be able to afford living accommodations in that school district. On the other hand, requiring the house to stay in trust for the kids to be raised in means it complicates your ex getting a good job offer closer to extended family to help raise younger kids if you pass on relatively soon. These are both negative results that can be negated by giving your trustee discretion over this decision.
You are choosing trustees because you trust them. If you start thinking about these hard choices and realize your trustee may not be up for making the right decisions if the time comes, then the solution is looking for different trustees... not tying your trustee's hands by forcing these types of decisions on them.
Stay connected with news and updates!
Join our mailing list to receive the latest news and updates from our team.
Don't worry, your information will not be shared.
We hate SPAM. We will never sell your information, for any reason.