Author Topic: Investing for a Trust  (Read 1501 times)


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Investing for a Trust
« on: July 06, 2015, 07:42:26 AM »
My FIRE is predicated on using family funds that are in a trust. I'm wondering if anyone has experience investing in Vanguard or some equivalent using a trust they control via POA.

The situation is as follows. My family did pretty well with a real estate sale of my parents' primary property 15 years ago and got some decent cash out of it. Since my parents spent little of that money, it sat in an investment account at an investment bank (think JP Morgan, Goldman Sachs, Deustche Bank, that sort of place) and basically doubled. When my father passed away, half the cash went to me, while my mother kept the other half. The bank made it hard for us to access the money, which was a royal pain in the ass since we were using the money to purchase a house using cash.

Since the 1990s, I have been managing an apartment building that belongs to my parents and collecting the income. Due to the way my father's will was written, the apartment building is entirely my mother's not mine. We received a phenomenal offer that is out of line with what the income can ever be from that building (they are offering what amounts to a cap rate of 2.22%). If we put it in index funds, we will be set with FIRE at 4%, even 3%. I may buy another building one day with that money, but probably not right away.

The building and my mother's current funds are in a trust, of which I have Power of Attorney. My mother is in her late 80s and isn't well, but she is cared for 24/7 in another country (the place of her birth and residence for the last 20 years). We asked if she wanted to come live with us, she said now.

Anyway, after my father passed away, we used a lawyer to rewrite her will and POA statements to make them as airtight as possible, even vetting them by the investment bank. But I am still wary of the bank. Moreover, although they claim that their index funds are fee free, I am also wary of that. Plus they want 1% for the privilege of working with a "private banker" (again if we invest in index funds, private banker reputedly gets no cut). I'd like put the funds in something I could manage myself directly, like Vanguard. Has anyone tried that?


  • Pencil Stache
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Re: Investing for a Trust
« Reply #1 on: July 06, 2015, 08:06:08 AM »
Assuming you can open new accounts for the trust, you can open a Vanguard non-retirement account using these forms. Transferring the funds should be as simple as writing a check to Vanguard, but you'll probably want to call them and talk through what they want.

Proud Foot

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Re: Investing for a Trust
« Reply #2 on: July 06, 2015, 11:13:47 AM »
Is there anything in the trust stating a specific custodian of the trust? If so that would make it hard to move it to somewhere else. 

Although they claim their index funds are fee free, I would almost guarantee it that you are paying some sort of administrative fee based upon the value and holdings in the trust.  You might ask them for their trust fee schedule.


  • 5 O'Clock Shadow
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Re: Investing for a Trust
« Reply #3 on: July 06, 2015, 05:59:47 PM »
I would call/email Vanguard. I'm sure they would be very happy to talk to someone about moving a mid six figures portfolio to their management.


  • Stubble
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Re: Investing for a Trust
« Reply #4 on: July 09, 2015, 08:20:14 AM »
Mid seven actually.

Nothing about a specific custodian beyond me.

Thanks for the tips. I'll talk to them. I may yet keep it with DB, but I have to do my research to find out if their index fund accounts are comparable.