By Jay Greene, Esq., CPA–
Although skydiving and traveling the world are both exciting endeavors to include on your bucket list, knowing what happens to your assets, to your money, and to those you love should be a higher priority on that important list.
Discover how you can protect your loved ones and everything that you have worked hard for.
The Bucket
A Living Trust and a bucket are similar in that they both allow you to put things inside and keep them safe until you need them.
When you create a trust, you are creating a legal “bucket” to put your assets into just as you have put your assets in your savings, houses, land, and timeshares. When you create a trust, you also can appoint someone whom you trust to manage your assets according to your wishes.
The only way for your wishes to be known and carried out is to have them legally declared in an estate plan.
Will vs. Living Trust
While a Last Will allows you to provide instructions for things you own in your name and declare who gets what, a Will does have limitations. First, a Will does not work until you die, and there are no instructions or guidelines provided if something happens to you during life such as becoming disabled. Second, a Will goes through a public legal process called Probate that can be costly and will take longer than a Trust Administration. Third, your Will can be challenged and if it is interpreted by the court, you are not in full control.
I recently read an article where a son challenged his mother’s Will and lost, but the presiding probate judge felt there was reasonable intent and decided to award the attorney representing the son his fee of $45,000. When this mom created her Will, I am sure that she did not anticipate that the family would lose $45,000 in legal fees that were intended as a gift to her descendants.
A Living Trust keeps you in control, avoids court interference in your plan, and can protect and manage your assets while you are still alive. It also ensures that your instructions in the trust agreement are followed.
Trusts and Their Benefits
The first thing you should do is meet with a qualified attorney who can counsel you through the options and choices you have when creating a Trust. Not all Trusts are the same, and they do not all offer the same protections and instructions. You need to understand not only what you want to go into the bucket, but also how you want to arrange what you put into that bucket. Some people who have actually created their Trust and have it in place may ultimately fail to put their assets in their trust. A key benefit of creating a Trust with proper counsel is that you remain in control until someone you trust takes over that responsibility. Some trusts provide the following benefits:
Trustee
When choosing a Trustee, you are selecting the person whom you trust to manage your plan and all the items you have placed into your bucket or Trust. As a Trustee, that person has a “Fiduciary Duty,” or the highest duty required by law to carry out your wishes to the best of their ability. This means that they must put your interests and intentions before their own.
Planning Goals
People have many different reasons for setting up a Trust. The important thing is that they understand how to include the proper instructions to make sure their plan works the way they want it to with the bucket including all important items. Some people make sure this is on their bucket list to protect their assets or to leave a legacy. Others include instructions to reduce the stress and expenses for their family. And others make this a priority to provide for and protect those they love. There are many different goals when it comes to Estate Planning and an important one is making sure your wishes are carried out rather than a plan that the government will make for you. When you do nothing, you have the intestacy plan, which is the government is in control.
Greene Estate, Probate, & Elder Law Firm helps clients understand how to accomplish their goals using estate planning tools. These tools include Trusts, Power of Attorney, Asset Protection Planning, and Probate. A Trust is one of the best tools available to carry out your wishes and also to plan for incapacity or death. The Greene Law Firm is ready to help you review or discuss your goals and cross off estate planning on your bucket list.
Statements In Compliance with California Rules of Professional Conduct: The materials in this article have been prepared by Attorney Jay Greene for educational purposes only and are not legal advice. This information does not create an attorney-client relationship. Individuals should consult with an estate planning and elder law attorney for up-to-date information for their individual plans.
Jay Greene, Attorney, CPA, is the founder of Greene Estate, Probate, & Elder Law Firm based in San Francisco, and is focused on helping LGBT individuals, couples, and families plan for their future, protect their assets, and preserve their wealth. For more information and to schedule an assessment, visit: https://assetprotectionbayarea.com/
Trust Essential
Published on January 26, 2023
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