Rumors Ch. 03

"Like where?" Annie asked.

Mom said, "I would like nothing better than to move to the Tahoe house full-time, if we could find jobs there that would support us."

I said, "We can't move into it, Mom. You and Dad set up the trust to own the Tahoe house. The terms of the trust only allow us the two weeks to use it, otherwise the trust is required to rent it out for market rates, which it does through a management company that services a bunch of other vacation rentals in the area. If we want to amend the trust to remove that requirement, we have to wait until Annie is 25 to do it."

"I admit to not paying that much attention to the trust language and let your Dad be the trustee, since that house came from his side of the family. I was just happy your education was going to be funded and you'd have the house left to you afterwards."

Annie snorted, drawing everyone's attention to her. She said, "Tell her, Tyler. See if her reaction is as strong as mine was."

Mom asked, "What's going on, you two? What don't I know?"

I answered, "When dad died, I became co-trustee with Mark Johnson, one of the trust officers at the bank, until I turned 21 and became the sole trustee, with their help making sure I don't violate any of its terms or the law. I almost passed out the first time I went through the financial reports with Mr. Johnson. As of the last fiscal year, the value of the trust fund has risen to seven million dollars, far more than we needed for our educations, even going to graduate school. About a million of that is the house and land, the rest is the investments that accumulated from all those years of renting the house out, then reinvesting dividends, etcetera."

Mom covered her lips with her fingertips, her eyes wide. Marissa's jaw dropped open. "You guys are millionaires?" Marissa asked. The glint in her eye appeared to be excitement, not greed.

"Yes and no," I answered. "Those are assets of the trust, which is legally separate from us but for our benefit. Except for my college expenses, I can't touch any of that money until after I graduate with my Bachelor's degree. Even then, I can only withdraw $35,000 per calendar year until I'm 25, then $100,000 after that. Annie's under the same terms, but we can modify or dissolve the trust after she turns 25. In 2024. We'll become multi-millionaires then, if we do that, but no sooner. If we haven't graduated, our share either has to go to charity or the next generation."

Shaking her head, Mom said, "I never imagined it would grow that big. We expected the $35,000 would be a good limit for your first few years after college, then the $100,000 withdrawals would drain the remainder of the invested rents, leaving just the house. That was even when you were the only one in the trust, before Annie was added. It will take what, 35 years to drain, at $200,000 per year?"

I chuckled. Time to drop the other shoe. "Actually, Mom, we'll never drain it, at that withdrawal rate. The trust is generating a shade under $600,000 in either income or asset appreciation every year between the rental and the investments. Peak rent was $1100 per night last winter and the company that arranges the rentals has already set a $1200 per night peak rent for this next winter. After paying the management company its fee, capital improvements each year and property and income taxes, that's bringing in around $80,000 in cash flow. But the other investments produce most of the income now. At the top of that list is a 20% stake in the rental management company itself. It brings in roughly $180,000 every year between dividends and valuation growth. I expect the trust might be generating $800,000 by the time I'm 25 or even a million by the time Annie is 25. At that point, even taking the house off of the rental market and drawing out $200,000 won't keep the trust from growing. We'd have to see whether the next generation could make a dent in it, but I doubt it, given another twenty-five years to grow. I don't think either of us want as many kids as it might take. More likely, we would need to modify the trust to accelerate the withdrawals or dissolve it and take the tax hit all at once."

"Do you two even need to work, after college?" Mom asked.

I shook my head. "I'm not even considering just living off that money. It's not how either of you raised us. Probably the main reason Dad didn't tell us how well the trust was doing was he didn't want us slacking off because of it. Although we've always known we need to graduate with a Bachelor's degree to qualify for distributions, we could have chosen majors that aren't as... commercially valuable, shall we say? Also, keep in mind that as some assets are liquidated to allow for withdrawals, there are capital gain tax implications. You can find plenty of professions that will pay $100,000 as salary, with the right skills, but will that still be considered a high salary 40 years from now? Will even $400,000? No, I'd rather work to produce an income that's even higher than that. I've always wanted to run a business that will make the trust seem tiny. The trust money can be seed capital to make that happen sooner, is all."

Annie said, "I agree with Ty. Dad would want us leveraging this money to be productive, not coasting. When Ty told me about the trust's value, I had visions of starting a free-standing birth center after I get certified as a nurse-midwife. It's why I'm adding some business electives, maybe even a second major. I could make the birth center a non-profit, if I don't have to be as reliant on it providing me a salary."

Marissa asked, "Didn't you guys inherit from your Dad, too?"

I answered, "Yeah. Dad actually was a millionaire, mostly through the appreciated value of his house and his retirement savings, valued at 1.3 million. Thankfully, the current value of the trust wasn't counted towards determining his estate tax, just his half of the value of the house at the time he and mom gifted it to the trust, when it was only worth $120,000."

Mom interrupted, "And I've had to keep filing an estate planning form with my taxes every year just because of my half of the gift."

I continued, "Then Dad had a $500,000 life insurance policy, giving Annie and I each a net worth of $900,000."

Marissa said, "So, you're almost millionaires, even without the trust."

I said, "Well, the IRAs we set up from Dad's IRA are pretty much untouchable until we retire ourselves. The tax basis of Dad's house is now the fair market value when he died, so we don't have to worry much about taxes when we sell. Excluding those, the other investments and assets we have are about $300,000 each, mostly the invested insurance money. It really wouldn't take us long to burn through that if we start living extravagantly. Like the house, we left Dad's car out of the division of assets. Annie drives it, for now, but we both own it."

"For now? What'chu talkin' about, Willis?", Annie said, parroting the line from the "Diff'rent Strokes" show that used to be on reruns.

"Well, I heard something about somebody graduating in a couple weeks?" I teased. "Mom and I figured you could use new wheels, up to $25,000 worth, so I can use Dad's Bronco for the summer, rather than sharing it. That's why I left my car back in Boulder. In the fall, we can donate Dad's car to charity and split the tax deduction. I'll drive my car home next summer."

Annie nearly levitated out of her seat. "No way! You guys don't have to... I can afford my own, can't I?"

Mom said, "Annie, we'd never be able to get you a gift again, if we let the fact that you can afford something yourself get in the way. You earned it, honey. Even with the upheavals of the past two years, you didn't let your grades slip. In fact, you improved on them. Your brother and I are proud of you and love you. Let this be our way of showing you, one that can be public, anyway." Mom tweaked one of Annie's nipples to indicate the non-public aspect.

"I love you both, so much," Annie said, looking close to tears. "Damned Gary! I wanted all four of us making love tonight. But we can't, because of him and his rumor getting too close to the truth."

I said, "We'll get there, sis. In Tahoe, for sure."

"How much closer to the truth could Gary have gotten?" Marissa asked Annie.

Annie answered, "He didn't link Ty to Mom, only to me. Hopefully, everyone accepts our denial that my being with Mom is instead of being with you and, through you, with Ty. If anyone suggests that it's in addition to being with you, it isn't as big a jump to suggest that you and Ty are intimate with Mom, too. It would still have to be proven, of course. Which is why Mom and I are keeping our hands off of him, to avoid creating evidence and keeping mostly away from you to avoid spoiling the denial."

Mom yawned and said, "We should all get back to bed or we'll be talking until the sun rises. I'll see everyone at breakfast." With that, Mom rose, came over to kiss Marissa deeply and me softly and went down the hallway to her bedroom.

Annie stood, came to me and said, "I really want your cock again, Ty, but I know we have to wait." Then she kissed me softly and kissed Marissa hard on the mouth and said, "I miss you too, querida. And I'm a bit jealous. Don't fuck him all night. I need to drag Tyler with me to show him what kind of car he's getting me before we're so buried in school books that we won't have time."

I snorted. "You show me, huh? Don't trust me to pick out something good?"

Annie laughed. "When have you ever gotten my style right, from clothes to music? You couldn't even buy the right personal hygiene!"

"Point taken," I said. "The less said about buying you pads, the better. I still shudder whenever I pass that aisle."

"We'll get you trained, one of these days, big brother. After all, you're going to have three women in your life, if we can work it out. Good night, both of you."

As Marissa and I got up from the couch to follow, she said, "Don't worry. My dad's clueless about tampons and pads, too. With a wife and four daughters, no less."

Back in my room, Marissa and I laid in my bed and started to caress each other again. Marissa looked troubled, so I said, "Whatever's on your mind, tell me."

She paused, before saying, "You know I'm not dating you for your money, don't you?"

"Of course," I reassured. "You didn't even know about how much money I have until just now, unless Annie told you. I don't talk about it much, because I have mixed emotions about it, myself. I'd rather have my dad back over having inherited from him. Also, Annie and I were taught to earn what we wanted. The money doesn't feel earned, y'know?"

"Still, your dad wanted you to have it, right? To do good with it?" she asked.

"Yeah. Except for buying myself a car, I've avoided spending it on myself until I'm ready to leverage it into a business. Buying Annie a car is only the second big transaction I've made, since the insurance paid off. I'll use my share of the rent on Dad's house to replace it, after leaving myself some spending money. I'm undecided whether to find a summer job to keep me busy. Spending lots of time with my new girlfriend this summer has appeal, too."

"Well, Annie and I both have summer jobs, me at Macy's, Annie volunteering at the hospital," she replied. "We both start the Monday after we get back from Tahoe, which is why I'm able to go with you up there. You'll have time on your hands if you're the only one not working."

A yawn crept out of my mouth. "Sorry. I guess my body is more tired than my mind right now. I want to make love to you again, but I'm not sure I have the energy left."

Marissa answered with her own yawn. "That's alright, Tyler. I think I'd rather just cuddle now, anyway." She rolled over, and scooted her butt into my groin. My half-hard cock pressed into her buttocks. While its reaction was to stiffen, another yawn told me to leave it be. I wrapped my left arm over her body, whispered, "Te amo," and fell to sleep without even hearing if she responded.

~~~~~