Will and Trust Questions

[linnemj]

Just attended a seminar in TN regarding estate planning. It was very interesting information. In TN, the vast majority of people do not need a trust. A will serves to distribute the estate in a timely fashion. There are no tax or privacy benefits that a trust offers vs. a will. Most interesting to me, is you can have a handwritten personal property list designating who gets what. This list can be updated as much as needed as long as it is handwritten, dated, and signed.

[sandsys]

A will serves to distribute the estate in a timely fashion.

 

Who gets to define timely?

 

Linda Sand

[Blues]

 

I'll not get into the details of her estate or the issue of will versus trust, but it is important to recognize that if there is more than one possible heir, the probability of a dispute, or at least talk of making one is very likely. My experience has made me very conscious of the potential problems for us, even though ours will not be a large estate.

 

I once saw a family fight among the 6 adult children of a decedent with a very small estate over a washing machine that still had payments owed on it. But a trust wouldn't have prevented that because the trust still ultimately distributes the property to designated beneficiaries, and those beneficiaries can still fight--only with a trust, there's no judge to oversee any of that nonsense.

 

 

I know I'm going to be facing a legal battle on mom's death and the advice I got was to go with a trust for most everything and a small will as it will reduce the problems I will face.

 

On our deaths we don't expect any problems but it will be nice for the kids to have things set up the way we do now. Maybe unnecessary but the cost of the trust package versus the will package was quite small so we didn't consider going against the advice we'd been given to save the money.

 

It sounds like a simple will for yourself would work (your mother's situation sounds more complicated). What was the cost going to be for your simple wills vs. the trust?

 

 

Your two questions, on money not going where it was intended we have been assured, multiple times by multiple lawyers that in our case the trust/will combo will be less expensive and get the bulk of mom's assets distributed faster.

 

I didn't ask about the cost or quickness of getting the assets distributed. I asked about your statement that without a trust, "it is possible a lot of what you thought would be left to your kids will go elsewhere." There's just no situation where a trust can do something in this regard that a will can't, and yours is one of those blanket (and untrue) statements that living trust salesmen use in their pitch.

 

 

I'm not so sure about just what tax advantages we are getting with a will over a trust, the savings might have come from some of the related changes we were told to make.

 

I assume you mean "trust over a will," but regardless, if you're not sure what the tax advantages of a trust over a will are, then maybe you think twice before saying, "Actually the trust game today is a way to avoid lawyers and the taxman preying on us in a lot of states." The living trust salesmen will say, "This trust will minimize your estate taxes." And that's 100% true. But to be 100% accurate, they should say, "This trust will minimize your estate taxes, although a will can accomplish exactly the same thing."

 

 

As to not being bonded, it may not be required but since I am nearly certain I'm going to be raked over the coals in court I'd like some protection. Since the amount of the bond will be based on the amount in probate, less money there equals less expense for the estate.

 

As I said, your mother's estate sounds more complicated than most people's. Having executors serve without bond is routine, so the cost of a bond isn't typically included in calculating how much probate will cost. But isn't it nice that there exists a system where you can get the protection you say you need--a system that you are telling people to avoid by having a trust.

 

Many states have done a pretty good job of simplifying the probate process, while keeping its protections and safeguards intact. In more situations than living trust salesmen would want you to know, probate is not particularly onerous any more and provides the same peace of mind that a trust can. And in fact possibly more peace of mind because you don't have any ongoing worry about properly transferring newly purchased assets in the trust.

 

There is no one-size-fits-all solution for estate planning, but the "will" solution fits a lot more people than we are often led to believe.

[skp51443]

Cost difference was only a hundred bucks or so for our last packet and mom's setup, don't recall the middle lot if we even asked about costs. The first one was something like $200 more for the trust.