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Special needs trust

By Terry Savage on August 12, 2016 | Wild Card

My son’s settlement was put into a special needs trust. The bank has been investing it in the stock market. Is this a smart way to manage his money?
Thank you, Stephan

Terry Says:  So, I’m assuming this settlement was the proceeds of a lawsuit.  The suit may have required that a bank manage the money, or else perhaps you are allowed to choose another “fiduciary” — someone to invest in your son’s best interests.  First you need to understand the terms of the trust in that regard.  Second, you need to ask how much the bank is charging as an annual management fee, and whether that includes commissions.   If the trust has been in effect for a year, it is certainly within your right to ask for a listing of ALL fees and commissions that have been paid.   In my opinion, if this totals up to more than 1.25 percent (and that’s being generous to the bank), then you should consider moving the trust to another fiduciary institution or trust company.  Pls write back for some recommendations if this is allowed by the terms of the trust.



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