• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer
  • Home
  • Our Firm
    • About Our Firm
    • Attorney and Staff Profiles
    • Communities We Serve
      • Cook County
        • Barrington
        • Glenview
        • Northbrook
        • Skokie
      • Lake County
        • Gurnee
        • Lincolnshire
        • Riverwoods
        • Vernon Hills
        • Waukegan
  • Services
    • Asset Protection & Business Planning
    • Estate and Gift Tax Figures
    • Estate Planning Services
    • Family-Owned Businesses & Farms
    • Financial Planning Assistance
    • Incapacity Planning
    • IRA & Retirement Planning
    • Legacy Planning
    • LGBTQ Estate Planning
    • Pet Planning
    • SECURE Act
    • Special Needs Planning
    • Trust Administration & Probate
  • Resources
    • Client Resources
      • Free Seminars
      • Estate and Gift Tax Figures
      • Free Estate Planning Worksheet
      • Is Your Estate Plan Outdated?
      • Probate Resources
        • Glenview Probate
        • Lake Forest Probate
        • Lincolnshire Probate
        • Northbrook Probate
        • Vernon Hills Probate
        • Waukegan Probate
    • Frequently Asked Questions
      • Asset Protection
      • Business Succession Planning
      • Estate Planning
      • Families Without an Estate Plan
      • Financial Planning Assistance
      • Legacy Wealth Planning
      • LGBTQ Estate Planning
      • Probate
      • Trust Administration & Probate
      • Trusts
    • Legacy Wealth Planning
    • Published Books
    • Reports
      • Advanced Estate Planning
      • Basic Estate Planning
      • Estate Planning for Niches
      • Trust Administration
  • BLOG
  • Contact Us
  • Review Us

Hedeker Law

Illinois Estate Planning Attorneys

Connect with us today(847) 913-5415

Attend a Free Seminar
Home / Inheritance Planning / How to Handle a Beneficiary with a Drug Problem in Your Estate Plan

How to Handle a Beneficiary with a Drug Problem in Your Estate Plan

June 19, 2018Inheritance Planning

Lincolnshire inheritance planningFor most people, inheritance planning focuses on the distribution of estate assets after death. As such, when you create your plan you will need to decide which assets to gift to which beneficiary. What do you do, however, if you have a beneficiary, who has a drug or alcohol addiction? Is gifting them assets from your estate akin to throwing those assets down the proverbial drain? If the beneficiary in question is your child, completely disinheriting your child may not be an option; however, neither is squandering the assets you spent a lifetime working to acquire an option. The Lincolnshire inheritance planning attorneys at Hedeker Law, Ltd. discuss tools and strategies for handling a beneficiary with a drug problem in your estate plan.

The Story of Matthew Mellon – How and Inheritance Can Fuel an Addiction

Drug addiction is a problem that knows no boundaries, striking the wealthy and the poor, the educated and uneducated, the famous and not so famous in equal proportions. If you have a loved one in your family who is struggling with a drug or alcohol addiction, you are hardly alone. The Federal Reserve’s Report on the Well-Being of American Households in 2017 reveals that one in five Americans knows someone who is addicted to opioids or prescription painkillers – and that accounts for only one class of addiction. For those who struggle with an addiction, accessing or finding the money to fund that addiction is a constant concern. The reality is that drugs are expensive. For an addict, inheriting a large sum of money can do more harm than good. Take, for example, the story of banking heir Matthew Mellon.

Mellon was an heir to one of the country’s biggest banking dynasties. His father committed suicide just before his high school graduation, which led to Matthew inheriting a total of $25 million from several trusts at the young age of 21 years old. By then, Matthew had already been diagnosed with bipolar disorder and been through several rehab programs. For the next three decades, Matthew struggled with addiction, most recently to the prescription drug Oxycontin. At one point, Mellon said he was taking as many as 80 pills a day at a cost of $100,000 per month. Thanks to his inheritance, however, he could afford such an expensive addiction. In April of this year, Mellon reportedly flew to Cancun, Mexico with the intent to check into yet another rehab facility; however, he was found dead in his hotel room before he could fulfill that intention.

Did Mellon’s huge inheritance, received at such a young age and not long after losing his father, contribute to his drug problem? Was there a better way to handle his inheritance?

Tools and Strategies for Handling a Beneficiary with an Addiction

Deciding how to distribute your estate assets can be difficult enough without adding in concerns about how those assets will be used after they are gifted. If you have a beneficiary with an addiction, however, you would be foolish to ignore the very real possibility that any inheritance left to that beneficiary may be squandered on the addiction. At the same time, if the beneficiary is a child, spouse, or other close loved one, you probably don’t want to completely disinherit them. In fact, leaving them nothing could trigger a Will contest leading to costly litigation during the probate of your estate. Fortunately, with careful inheritance planning, you may be able to avoid both of these unwanted outcomes.

A Trust May Be the Solution

Assets gifted in your Last Will and Testament become the property of the beneficiary, to do with as he/she sees fit, immediately after being distributed. Moreover, anything you leave to a beneficiary in your Will is distributed in a lump sum. For a beneficiary with an addiction that means receiving a valuable inheritance all at once with no oversight. A trust, on the other hand, offers a certain amount of control over the assets you gift to beneficiaries. Using the trust terms, you decide when assets are distributed and in what amount. This allows for staggered distributions. Even better is the ability to control how those assets can be used. For example, you could direct a monthly distribution paid out directly to a landlord or you could dictate that assets are only to be distributed for medical and/or rehab expenses. Finally, you have the ability to appoint a Trustee who will oversee the administration of the trust to ensure that your wishes are honored and your terms followed.

Contact Lincolnshire Inheritance Planning Attorneys  

Please join us for a FREE upcoming seminar. If you have questions or concerns regarding the inheritance planning, contact the experienced inheritance planning attorneys at Hedeker Law, Ltd. by calling (847) 913-5415 to schedule an appointment.

  • Author
  • Recent Posts
Dean R. Hedeker
Dean R. Hedeker
Dean Hedeker is a leading Chicago-area authority on estate and tax planning, business law and investments. A long-time resident of north suburban Lincolnshire, Dean has more than 35-years experience helping business owners and families grow, protect and pass on their hard-earned money through tax planning, estate planning and investment management services.
Dean R. Hedeker
Latest posts by Dean R. Hedeker (see all)
  • How Can I Terminate a Living Trust? - September 24, 2019
  • Is an AB Trust Right for My Estate Plan? - September 12, 2019
  • How Can I Include Philanthropy in My Estate Plan? - September 4, 2019

Other Articles You May Find Useful

Waukegan inheritance planning
Inheritance Planning Starts Earlier than You Thought
Waukegan inheritance planning
Inheritance Planning Goals
inheritance planning attorneys
Inheritance Planning Steps
Waukegan inheritance planning attorney
Inheritance Planning for the Beginner
Inheritance Planning
When Should Inheritance Planning Start?
Waukegan estate planning attorneys
Waukegan Estate Planning Attorneys Discuss After-Born Children

Primary Sidebar

FREE ESTATE PLANNING WORKSHEET

There's a lot that goes into setting up a comprehensive estate plan, but with our FREE worksheet, you'll be one step closer to getting yourself and your family on the path to a secure and happy future.

  • This field is for validation purposes and should be left unchanged.

Follow Us

  • Facebook
  • twitter
  • link
  • youtube

Testimonials

Client Review
September 8, 2020
    

Dean's knowledge is very comprehensive and current. He not only sees and understands the particular question but he puts it in the context my particular matter and to the overall business and tax environment. Dean has been my attorney for many (over 20) years. I am also an attorney but I would never make a tax, business or financial decision without his extraordinary advice and counsel.

default image
Raymond

Where We Are

LINCOLNSHIRE
1 Overlook Point, Suite 610,
Lincolnshire, IL 60069
Phone: (847) 913-5415

See Larger Map Get Directions

Blog Subscription

  • This field is for validation purposes and should be left unchanged.

Office Hours

Monday8:00 AM - 5:00 PM
Tuesday8:00 AM - 5:00 PM
Wednesday8:00 AM - 5:00 PM
Thursday8:00 AM - 5:00 PM
Friday8:00 AM - 5:00 PM

Map

hedeker_sidbr_map

Footer

  • Advantages of Working With Our Firm
  • About The American Academy
  • Privacy Policy
  • Disclaimer
  • Sitemap
  • Contact Us

Connect with Us

  • Facebook
  • twitter
  • link
  • youtube
footer-logo

Hedeker Law Ltd.
All Right Reseved.

Attorney Advertisement

© 2023 American Academy of Estate Planning Attorneys, Inc.