rt-5 Trust Fund Details-83-EconomicSanity101.com

Input and Withdrawal Credits:

Monies put into the trust fund earn a profit. In order to justly and fairly divide the profits, each participant will have one unit of credit for every $1,000 he or she has in the fund. Each year the total investment profits to the trust will be divided by the total number of credits. Each person will receive that amount times the number of credits he or she has. Those retired will receive their share of the profits in the form of monthly payments. Those not yet retired will have their share of the profits added to their investment fund.

A participant's credits are based on the amount of money he (or she) puts into the fund plus the additional monies added to his account from profits. Here's a very simplified example:

Suppose a person starts an account with $10,000. A the end of the year he has ten retirement credits. Suppose at the end of the year, his share of the trust fund profits was $500 and he personally added another $500 to his account. For the second year he would receive eleven credits.

The details and the intricacies of these calculations will be designed by those competent in accounting and set up in a fashion that is fair to all parties.

Receiving Withdrawal Credits from Another Beneficiary:

Upon the passing away of the original account holder, his/her investment funds are passed on to whomever that account holder has designated in his/her previously written instructions regarding the account. At the time of transfer, ninety-seven percent of the money put into the account is transferred into the new account holder's account and three percent is transferred to the trust's general fund. (That three percent is also invested and the profits are used to cover Management Costs and other related expenses. )

As an example, suppose an account owner has $100,000 in the account at the time of his passing. Of that money, a starting account worth $97,000 is transferred to the name of the new account holder, and $3,000 is transferred into the trust's general account. The new account holder would earn ninety-seven retirement credits per year on that money.

Any additional monies added to this second-generation account are credited to the account holder at the same rate as his predecessor, one credit per for every one thousand dollars in the account. A decision will also need to be made regarding credits for money in amounts less that $1,000 and for investment times times less than a full year.

Saying Goodbye to the Tax man and
minimizing Legal Piggly-wiggly:

Trusts, set up as non-profit organizations, can receive monies from corporations. If, for example, a company's labor organization (such as a union) has a non-profit trust set up for the benefit of retiring employees, the corporation can give money to that trust as a tax deductible gift. The employees never receive the money and thus it's not taxable. The employees receive retirement credits and pay taxes after retirement and then only on the money he/she actually receives. This eliminates the government rules and fees and penalties and all the rest of the bureaucratic gobbledy-gook.

Withdrawing Monies that Have Been Put into the Fund:

The trust is designed to be a trust in perpetuity for the beneficiary, for his family, and for his heirs, and, as such, the money (the original capital) put into the trust is not withdrawable. However, a policy needs to be set up for those who have an urgent need to withdraw the money that they, themselves, have put into the trust. Here's one possible way to approach this: A person can only withdraw the money that he/she has put into the fund (or that has been added to the trust by the person's employer with him/her as the named beneficiary) and the interest earned on that money. A minimum balance of twenty percent or $10, 000, whichever is greater must be left in the trust from the monies he/she (or the employer) has put in. Monies previously put into the trust by someone else for which a person has retirement credits are not withdrawable and are not creditable as part of the residual.

A set of guidelines needs to be set up and the Arbitrators branch of the trust management team shall be responsible for determining how the withdrawal policies are administered. By a vote called for by any member of any of the other three branches, (Rule-Makes, Managers, and Reality-Checkers ) the arbitrator's decisions may be vetoed, and/or altered.

Initially, each trust beneficiary will be required to pay a portion of the money requir

Covering Management Costs and Paying Other Related Expenses:

ed for administering the trust. This cost will eventually be replaced by money from the earnings from the general fund's portion of the investments. (Another possibility is that the company donating funds to the retirement trust may choose to also add sufficient money to cover the cost administering the trust during its beginning phase. ) As sufficient funds become available, members of the four branches of the trust shall be paid a reasonable compensation for their work. The amount of monies paid out in this manner are to be determined by and independent committee designated by the beneficiaries. Members of the four branches of the trust or anybody who has close ties to members of the four branches cannot be on this committee. All recommendations for monies paid to the people in the four branches must be approved by a majority vote of the beneficiaries.

Birthing New Trusts ...

Birthing New Trusts from the Womb of Existing Trusts:

Funds in the trust's general fund in excess of those needed for trust administration costs are held in a lending and/or grant fund. The fund will be used to assist other groups or individuals in setting up their own retirement trusts. The TLC-Life-Center Team will coordinate this aspect of the project and will establish a fund that can be used for this purpose.

Controlling and Using the Trust's Assets:

Rather than turning one's retirement funds over to some, big, profit-oriented, self-interest-focused corporation, each retirement trust will be under the control of the beneficiaries. The beneficiaries elect the people who will be members of the four branches of the trust's control team.

Joint, Retirement-fund Partners:

Two people who are marriage partners, life partners, and/or domestic partners can become joint, retirement-fund partners. Prior to retirement age, each partner simply designates the other as the recipient of his/her withdrawal credits and informs the trust of his/her status. For those who declare themselves to be retirement-fund partners, the three percent transfer fee is delayed until the passing of the second partner.

Letter of the Law and It's Intent:

All people placing funds into the trust (and those having monies put is with themselves as the beneficiary) must agree to all the trust's rules which are not appealable to outside litigation. All participants must agree to all the rules, and sign their consent to participate with a notarized signature.

All account holders (people who place money into the trust) must, prior to putting monies onto the trust, agree that all disputes that are not resolved within the above parameters, must be resolved by arbitration according to the trust's pre-established rules of arbitration. (A suggested set of arbitration rules will be added to this site at a later time.)

The trust's rules shall have two equally powerful parts -- the letter of those rules and the intention behind that stated rules. A violation of a rule's intention shall be equal to a violation of the letter of that rule. In any questionable practice, the Arbitrators shall resolve the disputes at their discretion. The Arbitrators' decisions are appealable to a combined decision of the other three branches of the trust, (Rule-Makes, Managers, and Reality-Checkers ) The three-branch decisions are final and unappealable.

All rules must be written in plain, easy-to-understand language. Any attempt to hide a rule under complicated sentence structure or by unwritten implication is prohibited. Any time a rule is found to be confusing or that is being misinterpreted by the beneficiaries, the wording must be altered, and both its meaning and its intention must be made clear.

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