Does a legal guardian have a right to spend the money a minor received as a beneficiary from a life insurance payout?

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Does a legal guardian have a right to spend the money a minor received as a beneficiary from a life insurance payout?

My father and mother divorced when I was 6. I was the beneficiary of my father’s life and accidental death policy. When he past I was 12. The insurance company disbursed the the funds from that policy when I was 12 to my mother, as she was my legal guardian for “my estate”. Does she have the right to spend it frivolously ? If at all?

Asked on September 23, 2011 under Estate Planning, Washington

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

I am so sorry for your loss and for the ensuing problems.  How specifically were the funds distributed?  By that I means were they placed in to a trust for your benefit?  Or were the funds just released to your Mom?  If she is the trustee of a trust or she was just given the finds she is probably permitted under the law to invade the trust or spend the money for the necessities necessary and for your benefit.  That means clothing, food, shelter, schooling, etc.  It could even mean buing you a car to get to and from school or work.  If you feel that your Mother is not using the money in your interests then seek help from another adult to discuss your options.  You have not said how old you are so it is hard to say what you can do yourself.  Good luck. 


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