<p>How many of you have set up a trust through which to leave your estate to your kids? Have you chosen separate people to be your executor and trustee? Have you designated that one of your kids will assume these roles when s/he reaches a certain age? If so, did you necessarily choose your eldest for this responsibility? Did you designate that your children will receive their inheritance in increments? If so, at what ages? Assuming you named your spouse as your healthcare proxy, whom did you name as the backup? A parent? A child? Any advice for someone who is just beginning to wrestle with all these decisions? We’ve been remiss until now in relying upon a 20-year old will that was drawn up back when we didn’t have two nickels to rub together.</p>
<p>Hmmm, we are where you are; estate planning review is long overdue. Our will is 22 years old and our youngest is covered as ‘any future offspring of this union’.</p>
<p>We did a trust. (YAY, only took me 30 years of constant nagging to get H to get a will even!!)</p>
<p>We did do separate executor for the will and trustee for the trust. We actually picked a private bank to be the trustee. That was something totally out of H and my orbit since we both were … um… well poor when growing up, so no experience with that sort of thing. But both of us were very pleasantly surprised at what the bank offered. Just a HUGE variety of services, all included. Now I forget the cost, but it was a fixed $$ minimum (not too huge) up to 1 or 2% of the estate. They had an example of a girl wanting extra $$ beyond her allowance due to prom costs. They had the banker assigned research typical costs and did come up with an amount for the girl, which included a hair dresser appointment, but not a private limo. Since we were looking down the tunnel at prom costs right then, it really resonated with us. </p>
<p>We also had family issues with who could be responsible for the kids since neither of us wanted to chose our own siblings (or our spouse’ siblings) and grandparents are too old. So the bank trust was a win/win and then could move on to the physical custody of the kids completely separated from the $$. </p>
<p>And we made the trust wrap up after they (presumably) graduate from college so that they can just go to college like they would if we were here and have someone else deal with the money. Not that there is a huge huge amount, but we did buy our first house in CA in the 70’s so have lots of appreciation. And if we are not living to spend it, we have retirement accounts that need tending… it really adds up once you really look at it.</p>
<p>We never put either kid in charge as that seems unfair to burden them and it can be a burden to manage money. When we talked to the bank person, they said just have the trust (legal) papers say that they will manage the estate for the health, education, and as normal living for the kids as possible. AND then to write them plus the kids a letter describing our outlook on life; what we value, what we disdain. For example, H wrote that he’d vote to give the kid a car … but NOT a NEW car or fancy car, just wheels like the $1000 Maverick he bought for himself used after soph year in college. It still gives them all the room they need to make the choices, but gives them a feeling for YOUR choices. Where if you write in the trust … age 21, give them a car… who knows what that means? What kind of car, kid might argue for a corvette or something when you meant a VW. So once you pinpoint just a few of your thoughts, the bank can really carry out your ‘wishes’. I’d recommend the letter even if you don’t have a trust! Very enlightening to discuss with each other, too.</p>
<p>I picked a friend for backup for healthcare etc. I think H picked his brother. It took us a long time to think outside the box in many ways. And once we did, it all seemed to fall together so easily! </p>
<p>I am majorly pleased to have it all done.</p>
<p>And our lawyer just does estate planning which I think was a benefit and he cost a LOT less than some I’ve heard about. I still have some separate family property so ours wasn’t just a plain vanilla thing and still cost about $2K I think … very very very worth it!</p>
<p>Worrywart, I think you’ll find that a lawyer who specializes in estate planning can provide you with many of the answers to your questions. My H and I had a very old will and we recently redid it. We had already created a trust, which is administered by a private bank and trust company. The trustee is a tax lawyer who is a family friend. </p>
<p>The people at the private bank and trust recommended three attorneys who specialized in estate planning, when we said we needed to update our wills. We met with all of the attorneys and decided on one. He was extremely helpful in offering suggestions and letting us know the tax implications of various decisions. He also brought up issues that we never considered, e.g., D1 is getting married in a few weeks and this raised the question of a pre-nup and whether D1’s fiance would agree to one and what should be included. There were issues like that which H and I never really considered. The work related to the will (which included two face-to-face meetings) was $7K.</p>
<br>
<br>
<p>I’m in year fourteen administering my father’s bypass Trust. The above comment resonates because my dad’s Trust contained nothing but “inside the box” thinking … stuff like “choose a lawyer who will merely put your wishes in legal form” and “don’t share any details of the Trust, even who the Trustee is, until after death.” My goal is to have this Trust wrapped up in two to three (more) years, but who knows?</p>
<p>Advice put simply … find a lawyer who specializes in Trusts and Estate Planning, and take your attorney’s counsel to heart.</p>
<p>What belongs in an Estate and what does not</p>
<p>ANYTHING with a named(s)beneficiary DOES NOT go through a lawyers hands (or fees). Most lawyers won’t tell you that because they want a percentage of the whole estate. A life insurance policy , IRA’s with a named beneficiary, annuities with a named beneficiary, etc. etc.</p>
<p>Another good policy (amongst well dealing siblings) is to have the parent equally divide any cash assets in different bank accounts with the children equally represented as co-signers. (Divide your money accounts by your number of children and make them individual co-signers to those accounts.) Probate and lawyer fees will thus be greatly avoided. </p>
<p>Estate lawyers hate it when people know this.</p>
<p>Very helpful response esobay. We too cannot turn to our siblings so it’s a big decision for us. Bromfield, we did meet with an attorney specializing in estate planning last night-- hence, all my questions that he’s asked us to answer. toblin, not sure whether he was looking out for his own interests but he advised us to retitle all of the property that we have jointly titled so that it WILL pass into the estate and therefore be sheltered from our state’s estate tax exemption limit. Does that make sense to others?</p>
<p>P.S. this attorney charges an hourly fee so he is not looking for a percentage of our estate.</p>
<p>We used a lawyer who charged a flat fee for all of the set up and recording of deeds, etc. he will charge a flat fee for services down the road. The above poster is correct, a good attorney will help guide you through all of the questions. The one thing I wouldn’t have thought about is that our attorney recommended spreading out disbursement at different ages because of divorce law statistics. In other words, if you both pass away and your children get the trust you don’t want them to get it all before the age of 30 because of the higher rate of divorce in the younger years.<br>
We own multiple properties, cars, etc. and yes everything will pass in. The attorney has done a good job bringing up all the questions…you just have to sit quietly now with DH and come up with the most reasonable answers.
It helped us to know that they can be changed as circumsstances change. For instance, both of our children are now over 18 so the need for a guardian has gone.
Just get what seems right to you now down on paper and get the process done. Don’t let the fact that things will change stop you.
IMHO.</p>
<p>Worrywart–I think it’s informative to hear what others have done in estate situations, e.g., who is executor of your estate, should the distribution in increments, etc. In the end, however, you and your H are the ones who have to make your own decisions based on what you think will work best for your family. We found once we sat down and discussed the issues, it wasn’t as difficult as we had expected to make the necessary decisions. We agreed on almost everything. One thing to remember is that you can always make changes if circumstances change.</p>
<p>worry - It’s true that having property jointly titled with spouse may help avoid estate taxes — for now. But it complicates estate planning for the surviving spouse because the estate tax exemption is twice as much for a couple as it is for single person. (There are other complications as well, but one is quite enough to make the point.)</p>
<p>If family members get along you can accomplish a lot with joint titling. But I’ve seen it go madly awry when family relations are contentious.</p>
<p>“Nobody wants to talk about death, and nobody wants to talk about money,” says Holly Isdale, managing director of Bessemer Trust. “It’s like planning a huge party that you’re never going to attend.” But you have to make sure you’ve set up your plan properly, she says: “You’re not going to be around to fix it if it goes wrong.” </p>
<p>[How</a> to avoid the ‘death tax’ - Jun. 4, 2009](<a href=“http://money.cnn.com/2009/06/03/pf/Death_tax_morrissey.fortune/index.htm]How”>http://money.cnn.com/2009/06/03/pf/Death_tax_morrissey.fortune/index.htm)</p>
<p>OP Re: change titles to everything question … yes, do that.</p>
<p>Also there is a good book about trust planning which I used to bludgeon (encourage) my husband with, but I can’t think of the name right now and I sent it to my brother. But… since there are a lot of tax issues and probate/tax savings that the trust is ALSO trying to accomplish, you do need to move the titles.</p>
<p>We didn’t move the titles of the cars since they are not worth much. But yes to all property, bank accounts. No to IRA’s since they are already outside the tax/trust issues.</p>
<p>You need to go to the library and ask for a trust book, possibly one written for your state of residence in mind so that you can get familiar with the vocabulary.</p>
<p>So we wound up with six !! different pieces in our trust … One type to fill up to the max allowed not taxed (and it was weird wording because it is sort of future speculative tense with the gov. changing the amount all the time). One was for the remainder after the tax carve out. And the final was separate discussion of property which had been separate property even during marriage. … It took a bunch of diagrams to have it make sense and to match the name of the type of trust to the “english” name I could remember.</p>
<p>And YAY to you for doing this!! I’ve seen WAY to much heartache caused by no planning.</p>
<p>Here’s a very good article on the subject from yesterday’s WSJ:
[Deciding</a> if Your Kid Is Trust-Worthy - WSJ.com](<a href=“http://online.wsj.com/article/SB124397907698178821.html]Deciding”>http://online.wsj.com/article/SB124397907698178821.html)</p>
<p>Incredible timing, patsmom! Thanks everyone for your thoughtful feedback and suggestions. esobay, you’re so right-- it’s like trying to learn a foreign language. Possible new market for Rosetta Stone? ebee, our attorney said the exact same thing: Don’t freeze up under the weight of these decisions. Do SOMETHING and realize how small are the odds of both of us passing on before our kids will come of age and be able to take on this job.</p>
<p>We got a very polished presentation from a very knowledgeable woman in a serious black business suit. She recommended (and marketed) a revocable living trust. I finally figured out that she was not an attorney and her firm was not a law firm; they simply sold the products and enlisted a law firm to draw up the documents. We ended up doing nothing, and are trying again now with a real attorney but will likely just update our wills (including probably a living will). The whole trust thing is too much trouble for me and probably overkill for us - the estate aint that big, and its shrinking fast.</p>
<br>
<br>
<p>I have.</p>
<br>
<br>
<p>No.</p>
<br>
<br>
<p>No, but that was a long time ago. They are old enough now that they could.</p>
<br>
<br>
<p>No. Kids are close enough in age that it should go to the one with the best head for money and figuring out details. Having someone local is good too. I would specify the order that they should be appointed. Thus, if the first kid ends up moving away, they can refuse to serve, and it goes to the next kid listed.</p>
<br>
<br>
<p>Money as they need it for education. The rest at 25, 30, and 35.</p>
<br>
<br>
<p>Parent (or the kids grand parents) is fine. Kids are now old enough that they can be named. I wouldn’t have a problem with that.</p>
<p>Make sure it is a Healthcare Power of Attorney, and also do a Living Will. In the Living Will, I specify that the decisions of the Healthcare POA superceede the Living Will. Just to make sure that the POA has full discretion/authority to decide the tradeoffs between advanced measures and potential benefit.</p>
<p>I did specify that feeding is non-negotiable. Take that away, and even someone healthy would die. Other than that, if I am 45 and otherwise healthy, or 99 and in my last days, the POA will be able to take that into account if extraordinary life sustaining treatment should be tried.</p>
<p>OD, yes we are having the POA and living wills drawn up as well. You make a very good point about specifying that one supercedes the other.</p>
<p>We had a fancy expensive trust done 20+ years ago and it was much more high tech than our income & assets merited. We used that, though as a guide, and recently used LegalZoom.com to set up a trust and do a new will.</p>
<p>In fairness to those paying the big bucks, my DH used to work in the estate planning field and has a far greater than normal understanding of the system, so we could utilise Legal Zoom for our simple needs.</p>
<p>We set up an aunt as both executor & trustee & another aunt as the contingent. We have the kids set up to get all the money at age 30 and have written up some personal guidelines for the aunties to understand our wishes.</p>
<p>We have also asked the kids to give us a list of any personal items they want- art, etc, it is very interesting and we are talking about it quite a bit with them.</p>
<p>We are not in a position to have enough for a lot of bitterness between siblings and are not planning for any contestations of the will/trust. We are leaving the more casual and not legally binding info to be helpful to the aunties in making decisions, but they also are both very fiscally responsible and have kids the same age as ours, thus if they do for our kids what they would want done for theirs, it will be fine.</p>
<br>
<br>
<p>My wife and I set up a bypass trust several years ago.</p>
<br>
<br>
<p>No</p>
<br>
<br>
<p>No we didn’t. I think they are still 10 years or so away from being ready for this. (oldest is 19)</p>
<br>
<br>
<p>n/a</p>
<br>
<br>
<p>Education funds are held out separately. They get 1/3 at 30, 35 and 40.</p>
<br>
<br>
<p>My mother in law (I know - taking putting my life in the hands of my MIL :(</p>
<p>It was a package put together by an attorney who charged us by the hour. We put everything into the trust including the house but excluding the life insurance and IRAs as those are not taxable. Once the laws are stable again (big changes scheduled for next year as various laws expire), I intend to revisit the subject as things have changed over the years.</p>