Let’s deal with who needs a trust first....
Everyone!
If you own property or have what can be described as significant assets, you need a trust, otherwise when you die (not if) your estate, which is everything you own regardless of value, becomes under the control of the state. You have a savings account with $3,500 in it and get hit by a bus, can your brother or sister walk into the bank and say, “My brother died, can I have his money?” What happens to your car, can they legally sell it? Now imagine a house with a $350,000 mortgage that is worth $475,000. Who has the ability to sell that house? What about the mortgage payments until it is sold?
Many people are single or in a committed or formalized domestic partnership relationship; just as important to have a trust. What if your partner gets hit by a bus and there is no trust or estate plan? Looks like his brothers and sisters, or children from a prior relationship, just became your partners in your home. If not it can cost you plenty of legal fees to keep them off title and any claims to his estate that you share.
Estate plans do not just deal with property and assets, they also detail who will have guardianship of your children and providing for their future should a bus make them orphans.
The term ‘hit by a bus’ is being used instead of saying ’if you die’ because very few of us know when, or about when, we will die. If you are hit by a bus tomorrow are your assets protected and will pass along to those you would intend them to be passed along to? What about your children? What if you spouse or partner gets hit by a bus tomorrow, are you protected and able to retain all assets you consider joint?
Not easy questions for us to think about, and very easy to put off the answers and solutions. Make sure your loved ones are spared the onerous dealings with the legal system merely to remain in their homes, especially while they are grieving your loss.
If you already have a trust and it has not been reviewed in at least five years I suggest you make that appointment as well; laws and assets have probably changed and you want to make sure your trust is protected.
If you need assistance in how to prepare a trust, please contact me: (949) 922-2200.
Your thoughts and feedback on this topic are greatly appreciated. Please feel free to post your comments.
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