Sad_Chemical_7485 writes:
I (25F) was in a car accident with my family (mom, dad, and younger brother) when I was 15, which left me paralyzed from the waist down. My mom broke her femur and some ribs. My dad had a minor concussion, and my brother had minor abdominal bruising but was never admitted to the hospital. The accident was entirely the other driver’s fault, and it led to an insurance settlement when I was 16.
The community I lived in at the time was incredibly generous and donated about $35,000 to help with my medical bills. I was also fortunate to receive top-of-the-line rehab at a couple of out-of-state hospitals, which must have been very expensive.
My maternal grandparents contributed a large amount of money to help with this rehab, probably close to $15,000. Since then, my parents paid for my college through a 529 plan they had set up long before the accident. Thanks to the excellent care I received and the opportunity to go to college, I now live independently, work a decent job, and can cover all of my bills for now.
Because the at-fault driver was an individual and not a company, my parents decided not to sue and accepted the auto insurance settlement instead. The problem is that my parents have changed their story about the settlement money many times.
At first, they said all the money, including the portion that didn’t belong to me, would go into an investment account that I could access if I ever needed medical care. Later, when I was 19 and my brother was 17, they bought a second house down the road from them that was intended for my brother.
My dad made the purchase somewhat impulsively, but they justified it by saying they had spent so much money, time, and attention on my medical needs and felt it was only fair that my brother receive something too. They rented the house for four years at a loss while my brother was in school.
During that time, I moved out on my own to another state after graduating college and have been paying all of my own bills ever since. Fast forward to today. My brother has lived in the house for a year, but it turns out my parents never actually planned to give it to him for free as they originally said. Instead, they expected him to pay back the mortgage, which he cannot afford, so he is now moving back in with them.
I assumed the insurance settlement money was long gone, but about a week ago my mom told me they had “discovered” a medical account and said I could just ask them if I ever needed medical supplies and they would reimburse me.
I asked if I could have control of the account and how much money was there. It turns out the entire insurance settlement for all of us was placed into my mom’s universal life insurance policy on the advice of their financial advisor.
They said they don’t know how much is in the policy but plan to give me $10,000 a year for medical expenses. After they pass away, they plan for my brother to be in charge of distributing those funds to me.
When I asked why they hadn’t given me this money before, they said it was because I was “financially irresponsible.” This confused and upset me. My credit score is over 750. I’ve lived on my own since I was 21. I have never missed a payment.
I track every expense and source of income in spreadsheets. I’ve never carried a balance on my credit card. My partner and I have a net worth of over $40,000. I know I’m not perfect, but I’ve never given anyone any reason to think I’m irresponsible with money.
At first, I was happy to hear there was still money left, but my partner was skeptical since my parents have changed their story so many times. I did some research and found that, according to court records, my parents were appointed as guardians of my $130,000 settlement until I became an adult.
My brother also received a $30,000 settlement. This money was commingled and placed into their own investment account, not in a trust or a UGMA account for me. Now I am thinking of asking my parents and their financial advisor to fix this situation in the most tax-advantaged way possible. I do not trust them anymore.
I want them to transfer my $130,000 settlement to me along with any unrealized capital gains from the past seven years. Based on the average performance of the S&P 500 over that time, the original $130,000 should have more than doubled. Even if they gave me the $10,000 per year they claim they planned to, they would still come out ahead by keeping control of the money.
I am tired of having my insurance settlement controlled by people who have not acted in my best interest. I want to invest this money in a Roth IRA to prepare for the inevitable medical expenses I will face as I age as a wheelchair user. If they refuse to comply, would I have a strong legal case against them? And am I the asshole for asking for the money as a lump sum?
I briefly interned for my parents’ financial advisor. He once bragged about committing PPP loan fraud, tried to get me to complete his continuing education requirements for him, never scheduled private client appointments, and joked constantly about how the staff lacked diversity, suggesting we should just wear darker makeup. So Gregg, the financial advisor, has not given me any reason to believe he is competent or ethical.
Dizzy_Emotion7381 says:
My husband and his family were in an accident many years ago. The youngest was the worst injured and received the most money while still a minor. The money was put into a trust until adulthood. You're going to have to sue for this because your settlement was mismanaged from the start. I would be surprised if there is any money left.
No_Zombie_1190 says:
You only git $130k for being permanently disabled???
notlikethemermaid90 says:
Everyone has already given great advice on what to do but honestly it just pissed me off for them to say they plan on making your brother in charge of distributing funds. You clearly seem capable of handling that yourself.
kmflushing says:
So it's looking like your parents stole from you. I'm sorry. Yeah. Get a lawyer to represent your interests.