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Old 09-06-2017, 12:35 PM
 
677 posts, read 844,077 times
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Artillery77 pointed out scenarios that make trusts a very worthwhile tool. We have one for some of the very reasons you mentioned in your post. My attorney suggested it after meeting with her and discussing some of our concerns and personal situation. Glad we did it, but we admittedly are still learning about it.
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Old 09-06-2017, 12:39 PM
 
72,009 posts, read 72,043,164 times
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Quote:
Originally Posted by steiconi View Post
my husband was executor of his sister's estate, with no trust. What a nightmare, it took nearly a year to get everything worked out.

I was executor of my parents's trust, things went smoothly, bing bang boom done.

We keep meaning to create a trust, but haven't done it yet. I believe you can do it economically online.
after all our bad experiences with trusts and wills i am big on beneficiary and tods as my methods of choice .

as long as a trust is not needed i would never want to resort to them .

i just pulled my money from vanguard for that reason . they were the only place we use that would not allow us to have beneficiaries on a joint account .

rather than start splitting things in to individual accounts i made it easy . we pulled the securities out and will let someone who does allow it baby sit them .
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Old 09-06-2017, 01:06 PM
DKM
 
Location: Thousand Oaks, CA
2,853 posts, read 1,023,373 times
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You don't really need one given your set of facts. You can look at it as prepaid estate costs though, as the amount spent on the trust will generally save the same amount on probate in a simple situation. This isn't a one size fits all thing. However, it is a form of insurance against some potential problems that may occur (and you will learn all about that at the dinner). To me the deciding factor would be if I plan to own my house when I die. If so, a trust is worth having. If not, its hardly a big deal to probate some bank accounts and you have a sole beneficiary.
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Old 09-06-2017, 01:18 PM
 
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What is the situation with probate on the home? We have beneficiaries and TODs on every account but the home is not "protected" against probate costs.

Is this a state related question? We do have an will/estate attorney who did all our legal papers but have to revisit the "house" situation to make it easier for our adult kids.

We paid about 10k probate costs for each parent and would prefer to avoid that. My parents had a will but did not list beneficiaries or have TODs on their accounts.
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Old 09-06-2017, 02:04 PM
 
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You already have an estate plan (you posted you have will etc. done by a lawyer years ago).
Just save yourself some trouble and time, and make an appt. to go over your estate plan. For the cost of an hour of time, your existing atty will make sure its all still current (laws change, your assets/wishes change). Ask whether a trust makes sense.
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Old 09-06-2017, 02:18 PM
 
Location: Florida
4,383 posts, read 3,726,321 times
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Quote:
Originally Posted by BellaDL View Post
I have been wondering whether we should establish a trust especially after reading all the threads here about long term care and estate planning.

We just received an invitation for a free dinner seminar "7 Reasons Why Trusts Are Preferred Over Wills". We usually ignore or toss those free dinner seminar invitations away but I decide to have a closer look at the invitation.

The invitation claimed that in 1991 AARP advised members to use trusts instead of wills and gave 7 reasons. I think that only 2 of the 7 reasons may apply to us (my reasons are in blue).

1. Living trusts help avoid guardianship in the case of disability. Not applicable since the chance of both of us become disabled at the same time is very tiny & if so, our only daughter is the obvious guardian.

2. Trusts avoid the expense and delay of probate court proceedings. Not applicable since we only one daughter and will leave most things to her.

3. Trusts can provide asset protection for your home and life savings from nursing home costs. Maybe applicable. From little that I have read, only irrevocable trust can provide the protection. We don't have LTCi and plan to self-insured. We also don't like the idea of asset shielding for Medicaid (just like our parents). However, I would like to be more educated on the subject.

4. Trusts are private while wills expose your assets and heirs to public scrutiny. Not applicable We are neither rich nor famous so I don't think that anyone would care to know about our wills!

5. Trusts can protect inheritances from children's divorces. Probably not applicable. Our only daughter has just recently engaged and does not seem to be crazy about children. We will just have to be contented with the grand puppies.

6. Trusts avoid the additional probates required for out-of-state property. Not applicable now or in the future.

7. Trusts can protect your assets if your spouse remarries after your death. Maybe applicable. I have always thought we can address this in our wills but maybe it is better to address this potential concern with a trust.

I told my husband about the invitation and convinced him to go to the dinner just to learn more. We may have to endure a boring, mind-numbing presentation loaded with exaggerated scary facts and likely to be bothered with follow-up emails and phone calls. However, we may learn few things at the seminar.

I'd appreciate comments and feedbacks from retirees who have trusts and who have decided that wills are good enough for them.
I am commenting as I read each item.

Since you did not determine a need for a trust before the invasion I would say no. But going to the dinner to learn about trusts and deciding a couple of months down the road is ok. Be sure the attorney you use is an expert in estate planning and trusts. Talk to several attorneys.

I think of the AARP as a marketing organization more than a source of good retirement information.

#1 True and you could both be in an automobile accident and disabled. You should have a power of attorney and this can cover the guardian problem.

#2 True, the key is how are your assets titled etc. Any asset you leave in a will, has to go through probate (remember I do not know your local laws). You want to title brokerage and bank accounts as TOD or POD. Transfer on death or payable on death. Just call the institutions. No attorney needed. If you can not do that you should be able to add a beneficiary to the account. Thus the assets will not go through probate. Your home will probably go through probate but not in all states. Depending on the state your daughter could probably handle probate for assets such as the home. Might need to hire an hour or two of services from an attorney.

#3 False. I think you have the correct answer, irrevocable trusts and now you might get into gift taxes (probably not tax due) etc. Remember you go to work every day and expect to get paid. Why would the people at the nursing home work for you without being paid? Or do you want to be broke so the taxpayers pay for your stay.

#4 True but as you point out who cares.

#5 True and you should rethink this. This can be a real benefit as divorce is not uncommon or a spendthrift husband. You be the bad guy and really think of using a trust that is set up in your will. I think your daughter could be the trustee but this is something to discuss with an attorney. If the money you are leaving is significant to your daughter I would lean toward the trust in your will. Could make it optional in the will (??) Ask at the dinner how a trust set up in your will would work and who the trustee had to be. Problem could be weak asset protection if beneficiary is also trustee but this is a new area for me so be sure to ask.

#6 True and could be a benefit but as you said no need.

#7 True. I agree with you, set the trust up in your will. Remember one of you could die today and the other would probably remarry (??). But if you took my advice in #2 there would be no assets in your will for the trust. You could make a trust the beneficiary and not use TOD/POD. The trust would be created now, irrevocable, and not be funded. Having the trust set up prior to the second marriage would be beneficial if their was disputes in the seconds spouse's estate.

You did not mention your age but it would probably be good to go to any retirement topic dinners also. As you said to learn. Whatever you do, do not buy without letting a few months pass. My impression is your fees will have to cover a lot of other people's dinners.

Overall I would say you do not want a funded trust at this time.

Just read through the other posts and see you have family lawyers. I think they could give you very good advice on the need for a trust. Yes best to have the final trust done by a lawyer that practices in your state.

With attorneys in the family I would think your daughter could handle the probate.

Last edited by rjm1cc; 09-06-2017 at 02:37 PM..
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Old 09-06-2017, 02:32 PM
 
Location: Florida
4,383 posts, read 3,726,321 times
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Quote:
Originally Posted by shamrock4 View Post
What is the situation with probate on the home? We have beneficiaries and TODs on every account but the home is not "protected" against probate costs.

Is this a state related question? We do have an will/estate attorney who did all our legal papers but have to revisit the "house" situation to make it easier for our adult kids.

We paid about 10k probate costs for each parent and would prefer to avoid that. My parents had a will but did not list beneficiaries or have TODs on their accounts.
This can vary by state. I know one state that the home does not go through probate if the home qualified as a homestead and the children inherited the home through the will. I think this might be unusual. Point is best to mention the state you are going to die in for a better opinion.

Putting the children on your deed or doing a "lady bird" deed can also have a lot of problems. The home could probably go into a trust by itself to help solve the problem. But be certain the trust does not cause problem with loss of real estate tax protection, title insurance, homeowners insurance etc.

Probate fees attach to the assets passing under the will so TOD/POD etc maybe the better way to go for most of us.
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Old 09-06-2017, 03:26 PM
 
Location: 5,400 feet
2,627 posts, read 2,590,740 times
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Quote:
Originally Posted by Heidi60 View Post
Find a good elder law attorney who can get to know your particular situation in your area. Local laws may vary according to your assets so this forum may not provide accurate information. Also, no matter what you do be sure to revisit all your documents such as will and power of attorney at least every five years to resign them which keeps them "fresh" as people change their minds or others may challenge on the grounds of being too old.

Go to the seminar if you like, but always contact a qualified local attorney before signing!
This is the best advice.

I used to have people come to me insisting on a trust after going to one of those 'seminars', which is really just a sales pitch by the firm. My guess is 60-70% of those folks didn't need a trust and the added cost of having one. The most common conditions for considering a trust are divorced with minor children or children with different spouses, property ownership in different states, a far flung family with distributions to all members, etc. I was then in a state where probate was pretty simple, the probate judges and their clerks were very helpful and 90% of folks didn't need an attorney to get through it. I also probated estates for family members in states where it was almost mandatory to have a local attorney. So a local attorney can help you now.

From the info you've posted, it doesn't appear that you require a trust and can likely address all of your issues with a will and some account retitling. I think every state now recognizes transfer on death for financial accounts, and about half recognize some from of transfer on death on real property. Presentation of a death cert is typically all that is required to get the funds transferred after death. You should all of those options to determine what works best for you.

Also remember that a trust requires maintenance. That means all property has to be titled in the trust, including personal property, real property and financial accounts. Nothing is automatic, so you need the correct docs prepared for that and keep them current. Any asset not in the trust still goes to probate, so you still need a will to address something missed (sometimes called a pourover). I've seen a couple of estates that lacked that and those assets of the decedent deemed not in the trust were handled as if he was intestate (and distributed pursuant to the state law).
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Old 09-06-2017, 06:08 PM
 
Location: VT; previously MD & NJ
2,230 posts, read 1,367,625 times
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Quote:
Originally Posted by shamrock4 View Post
What is the situation with probate on the home? We have beneficiaries and TODs on every account but the home is not "protected" against probate costs.

Is this a state related question? We do have an will/estate attorney who did all our legal papers but have to revisit the "house" situation to make it easier for our adult kids.

We paid about 10k probate costs for each parent and would prefer to avoid that. My parents had a will but did not list beneficiaries or have TODs on their accounts.
This is where I am puzzled also. I am not a "we" but I am an "I" having been divorced most of my adult life. All my accounts have my only child named as TOD, with my 2 grands as 50% each if my child is not living at the time of my death. Even my car (in VT) has a TOD. So the only thing not covered is my home which I own outright.

So in my situation, (not included in artillery77's examples), what would be the point of a trust? Or even a will for that matter?
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Old 09-06-2017, 08:06 PM
 
677 posts, read 844,077 times
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Quote:
Originally Posted by jiminnm View Post

Also remember that a trust requires maintenance. That means all property has to be titled in the trust, including personal property, real property and financial accounts. Nothing is automatic, so you need the correct docs prepared for that and keep them current. Any asset not in the trust still goes to probate, so you still need a will to address something missed (sometimes called a pourover). I've seen a couple of estates that lacked that and those assets of the decedent deemed not in the trust were handled as if he was intestate (and distributed pursuant to the state law).
We had our trust made earlier this year and are still learning about it. We haven't funded much of our assets/accounts into it yet but plan to. Are you saying if it's not in the trust it isn't part of our will in general? That's not what we were to understand.
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