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nanariggs: 'My husband and I have been retired for 5 years. All of our assets are in a trust, except for $50k i recently received in an injury settlement.

We have 5 grandchildren. the three eldest grandchildren have stable parents with good income for their childrens current needs and college. The two youngest grandchildren do not have a stable environment or income. Currently we give to the grandchildren equally - gifts, clothes, uniforms, special interests, and career prep costs.

the two youngest live near us, and spend the most time with us. I want to set aside $20k for the youngest grandkids college. they are 7 and in the second grade. i have discussed this idea with my husband and their mom. Husband acknowledges their need is greater, but thinks we should keep the equality rule."

I understand the desire for an equality rule, but how should equality be measured?

"distribution was made unto every man according as he had need"

Acts 4:35 suggests that uneqal amounts but equal to need is fair.

"Mom is concerned that putting money in their name and social security number would limit any grants or scholarships they might obtain. i don't care what the other parents think about this idea, and don't plan to get their input or approval. how do i approach this plan? do i set aside money within the trust? do i use $20k from outside the trust to start a separate fund, and transfer money from the trust to the fund? what else do i need to consider?"

A 529 plan that you open in your name (actually two accounts, one for each) sounds like the most efficient choice, IMO, for your needs.

"we will be talking to our trust manager next month. I need to be prepared. putting money in their name without any oversight is risky. We can't trust bank and insurance execs to do the right thing, I don't think an 18 year old is any more trustworthy. I can't put their parents in charge of ANY significant amounts of money for them (long story). does any of the education trusts like the 529s guarantee oversight?"

Oversight by whom?

"no matter what happens to me or our retirement savings, i want to assure the money is there for those boys. i am also concerned about blending the insurance settlement money with our regular retirement savings. my husband views the settlement money as 'play money' and might just decide to play with it OR decide to split the money among all of the kids equally (he still believes the equal distribution of education money is the way to go)."

Good luck.

Regards, JAFO
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