A) Definitely talk to a local estate planning attorney

B) Check them out. There are some who will push unnecessary trusts/lots of lawyer/bankers who will churn fees on trusts.

quote:

Some people will say that trusts are simple and can be easily prepared without an attorney by using something like Quicken WillMaker & Trust. I think that would be a mistake.

^^^^^^^^^
I am always amazed how people think they can handle complex legal matters without an attorney. To me it would be like doing surgery on yourself.

quote:

Originally posted by jhe888:
I have responded to the OP.

Trusts are often thought to be a panacea for many financial matters. They can be useful, and there are other situations in which they offer no advantages or even disadvantages. Many people think they know a lot more about this than they actually do. There are a lot of mistaken ideas about trusts among laymen.

TALK TO A ESTATE PLANNING LAWYER IN YOUR STATE!

As a layman who has a family living (revocable) trust, I know a fair bit about the advantages and disadvantages relevant to my situation *in my state of residence*. As someone who has owned real estate in multiple states, I am aware that there are significant differences in the laws relating to real estate and real estate transaction in different states. I can only assume that the same is true of trusts in different states.

Talk with an estate planning / trust lawyer IN YOUR STATE OF RESIDENCE.

If you would like to minimize the cost, think it all through, list all your assets, and write up how you want them distributed when you’re gone. If it isn’t just you, but you and your spouse (or your in-laws), for goodness sake sit down and work through all this together *before* you go talk to the lawyer. Sitting in his or her office with the meter running is not the time to be thinking about it in depth for the first time or discussing it with your spouse for the first time.

Understand that the lawyer may suggest some changes to your plan for legal reasons or tax efficiency and you should consider those recommendations carefully. However, making a few reasonable tweaks for efficiency or legal reasons you didn’t know about takes a lot less time than drawing up a complete plan from scratch that is acceptable to two customers who haven’t thought things through ahead of time.

quote:

Originally posted by TMats:
It’s been awhile since we set ours up and I don’t think I can adequately provide good information on the benefits of one. I’m confused by your statement that your in-laws want to set one up. Why does that impact you? As I understood a trust, it’s primary benefit is to protect family assets, your family assets, from the vagaries of divorce (for one thing) and personal injury claims. I’m hard put to see the benefit of entering into a family trust with those who are family by marriage. Others smarter than I should be able to set us both straight. Otherwise, yeah, a family trust is a good thing.

There are trusts and then there are trusts. A family revocable trust (at least in California) is mainly an estate planning tool that includes among its benefits avoiding probate on assets placed in the trust, preserving successor trustee access / control over the assets on death of the grantor (it can get ugly when there are monthly (and other) expenses that need to be dealt with, but banks won’t allow access to accounts until the courts bless such access, and tax efficiency, especially with what is sometimes called an A / B trust setup for a couple. These are relatively common and there are many folks who can benefit from them.

There are also more involved trusts designed to protect generational wealth from spouses. One executive at a high tech company I worked for shared one day that he wasn’t leaving anything directly to his kids, rather it was going into a trust for their benefit. At least according to his belief, a divorcing spouse would never be able to attack the body of what he was leaving for them, because they’d never own it.

The former type of trust might benefit the OP as more of what his in-laws want to leave his wife might get to her rather than get eaten up in probate or taxes. That latter type of trust might just insure that it isn’t to his benefit to divorce her, not that he has any interest in doing that anyway.

quote:

Originally posted by ZSMICHAEL:

quote:

Some people will say that trusts are simple and can be easily prepared without an attorney by using something like Quicken WillMaker & Trust. I think that would be a mistake.

^^^^^^^^^
I am always amazed how people think they can handle complex legal matters without an attorney. To me it would be like doing surgery on yourself.

One of those types of tools might be useful for background and to help one organize their thoughts before talking to a highly qualified estate planning attorney, but only if it didn’t a) burden one with information that was wrong, irrelevant to one’s situation, or inappropriate to one’s situation, or b) give one the mistaken impression that they didn’t need that highly qualified estate planning attorney.

I think I’d stick with a quiet room, the cotrustee (if any), a couple of pens and a couple of legal pads to list the assets and what want done with them before talking to the attorney.

Here is an example of what I mean:

Many think trusts provide the great advantage of "avoiding probate." If your estate is simple (which includes owning the sorts of assets 85% of us own), and going to a spouse and/or maybe a set of direct descendants, then in Texas, at least, avoiding probate is not really much of a benefit. Probate is simplish, or at least not more complicated and expensive than creating and administering a trust for some number of years.

If you are trying to protect wealth over a number of generations (which presents a whole different set of problems), have assets that are potentially subject to inheritance taxes, are trying to shield assets from creditors (again, presenting another whole different set of problems), trying to preserve certain government benefits, or are trying to make provisions for people who can't be trusted to manage for themselves, then trusts can make sense.

I have talked to many people who think they need trusts who do not. Many people will be served will with a regular, boring old will. Trusts are not a magic estate planning bullet.

I am sure all of you who have trusts have excellent reasons, but advising others based on your needs and your state's laws is not doing them any favors. This stuff is complicated. As our old friend J. Allen said, "Nothing beats knowing what you are doing."

quote:

Many people will be served with a regular, boring old will.

A lot of this is determined by what state you're in and the specifics jhe mentions.

In states like I'm living, where titling your real estate, rolling stock, and various financial accounts can handle much of this outside probate, there's another group of important documents that many ignore.
Healthcare POA for assigning someone to make medical decisions if you are not able to do them yourself, living will that express your wishes if you have a terminal illness, and whatever else a family attorney advises for your situation.

quote:

Originally posted by jhe888:
Here is an example of what I mean:

Many think trusts provide the great advantage of "avoiding probate." If your estate is simple (which includes owning the sorts of assets 85% of us own), and going to a spouse and/or maybe a set of direct descendants, then in Texas, at least, avoiding probate is not really much of a benefit. Probate is simplish, or at least not more complicated and expensive than creating and administering a trust for some number of years.

If you are trying to protect wealth over a number of generations (which presents a whole different set of problems), have assets that are potentially subject to inheritance taxes, are trying to shield assets from creditors (again, presenting another whole different set of problems), trying to preserve certain government benefits, or are trying to make provisions for people who can't be trusted to manage for themselves, then trusts can make sense.

I have talked to many people who think they need trusts who do not. Many people will be served will with a regular, boring old will. Trusts are not a magic estate planning bullet.

I am sure all of you who have trusts have excellent reasons, but advising others based on your needs and your state's laws is not doing them any favors. This stuff is complicated. As our old friend J. Allen said, "Nothing beats knowing what you are doing."

jhe888 makes an excellent point. We started our whole process by visiting an estate attorney and wanting to know from them the best way to proceed. For our situation in NV the trust was the way to go. I'm not so sure, but I suspect our friend JAllen may have been part of the advice we took to visit the estate attorney. He was indeed a wealth of knowledge and a great resource to this forum.

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