There have been a few threads on that, I believe.
We had an old will in Illinois done by an attorney, no trusts. When we moved to California, we consulted an estate specialist because (1) different state and (2) DS was no longer a minor. We have only the one child and the odds of grandchildren (or even DIL) are not high. First thing we learned about was the low probate level in this state. We created a family trust and put the house in it. All of my investment accounts are designated to go directly to DH or DS now so will avoid probate. DH has one major managed investment account that allegedly can neither go into the trust nor have a TOD designation. I’m not sure I believe this but the account manager is DH’s very good friend of 50 years so not much I can do. I fear that account will have to go through probate.
My mom passed away right after we moved here and even though her accounts were all in good shape, most everything had been in a living trust so it took a lot of steps and paperwork to get them into a regular trust, divided between my brother and myself, then transferred to each of us. Try to get a Medallion Signature Guarantee when you have no local accounts; I had to wait until I was back in Illinois. So I felt there was no need to put more than absolutely necessary into our living trust since estate tax is not an issue. I learned a lot that year! But it’s not stuff that DS would have an easy time with since there haven’t been will/trust video games. :)). He has a digital copy of our wills and trusts and other paperwork and the attorney’s name. Also I took some steps to simplify and consolidate my accounts so less to deal with.
@“Youdon’tsay” – probate in Texas is easy, so you are ahead of the game being in Texas.
You wrote:
That is the type of provision that definitely can be specified in a will. And what you would want is not necessarily what your kids will do or agree to once you are gone.
However, it is far more likely that one parent will predecease the other. Property owned in joint tenancy automatically goes to the survivor, no probate needed – so that typically takes care of the house of a married couple. Texas is a community property state, so pretty much half of the estate also passes automatically to the surviving spouse.
And once the remainder has been probated and distributed, it belongs to the legatee to do whatever they want. So lets’ say that the husband dies, house goes the wife. Wife can do whatever she wants with the house - she can sell it, keep the proceeds; or remarry and move husband #2 into the house, and later leave it to him.
What about that idea of leaving the house to the kids, subject to a life tenancy for the wife? Well, if the house was in joint tenancy, it isn’t subject to the will in the first place. And if the house was in the husband’s name — the wife still has a community property interest in the house (which may be 50% or something different, depending on where the house came from and how it was paid for). So not so easy. And while that idea of setting things up so mom stays in the house but it goes to the kids eventually might make a lot of sense for an elderly or infirm surviving spouse who won’t be there long… it could be quite limiting for a younger survivor who may live another 30 years. My own mom died 40 years ago and dad still is alive & kicking — the first thing my dad wanted to do was to sell the house because the memories of mom were too painful for him. He’s remarried twice and bought & sold 3 houses since that time. And he has every legal right to leave whatever he has remaining to wife #3.
And keep in mind that the owners of a house are also the ones on the hook for paying taxes and making repairs If the kids own the house that is occupied rent-free by a parent because of the terms of the will… and the roof needs to be replaced – it’s on the kids to do that.
So it’s best to put whatever you want in writing in the will (not rely on what you believe that your survivors will think that you wanted) — and also best for families with modest assets to set things up so that property will pass smoothly when you go. If you are a billionaire-- fine, set up life estates because the earnings on the investments will be more than enough to support the survivors in style … but for a more modest estate, then I think it’s best to set it up so that they the survivors will be able to get on with their lives, and use or spend whatever they’ve inherited to meet their ongoing needs without being caught up in responsibilities or fiduciary duties to one another created by an overly ambitious will. It’s always possible to throw life insurance into the mix if you want to make sure that the kids get something, while recognizing the likelihood that whatever is left to the surviving spouse may very likely be used or spent during their lifetime.
@lookingforward $700 to do a living trust was a special EAP price, plus the guy probably felt guilty for taking thousands of dollars from me for the probate process. The more customary price that I see runs more like $2-3K.
“Texas is a community property state, so pretty much half of the estate also passes automatically to the surviving spouse.”
I don’t think that is exactly correct, @calmom. I think you meant half of what the couple owns is owned by the surviving spouse. If you are talking about intestate scheme, all community property of the deceased passes to the surviving spouse. Then anything owned by the deceased as separate property is distributed according to the state laws. In WA, half of the separate property of the deceased passed to the spouse, the rest is divided equally among the children. If the deceased was married, all property is apparently presumed community unless proven otherwise. To avoid probate, a WA couple can sign a community property agreement specifying that all of their $ and belongings are community. Then the court looks at that piece of paper, and that is pretty much the end of probate. Surviving spouse takes it all. A couple can also sign a separate property agreement specifying property which belongs to a given spouse. Can’t divvy up the kids though or make someone do something illegal. 
We live in a community property state and since we’ve been married since we were practically children, we don’t have separate property. The house, the IRAs, the bank accounts are all community property and will pass to the survivor. I don’t think that the first to die could even will away his or her half. It automatically goes to the surviving spouse.
“I don’t think that the first to die could even will away his or her half.”
I am not aware of any state that would prohibit that. That would be akin to state taking individual property rights away! A big no no.
For estate planning purposes, think of community property as an intestate scheme for property that the couple acquired during marriage. You either die intestate or with a will.
Sorry, you guys are right, I worded things badly – the point is that the surviving spouse’s half of the community property is not even part of the estate to begin with. So if there is $100K of community property in the bank, at most $50K could be disposed of by will.
In Texas, it looks like if the OP dies intestate, then the spouse inherits 100% of the community property and 1/3rd of any separate property; the rest goes to the kids. See https://www.nolo.com/legal-encyclopedia/intestate-succession-texas.html
The anticipated land that the OP expects to inherit from OP’s parents will be separate property. So without a will the spouse would get 1/3 of that plus a life estate in the property; with a will, the OP can assure that the land goes straight to the kids. (Alternatively the OP could make modifications to the land title to achieve the same effect, by giving the kids a direct recorded ownership interest through a recorded deed). Since the OP doesn’t yet have that land, the best thing might be to simply specify in the will that 100% of separate property goes to the kids --and then if and when the OP inherits the land, a codicil can be added to the will specifically describing the property.
The problems occur when the deceased has assets their name only and not covered properly by assignment in a will or trust. No community property laws cover this seemingly. This is also why you shouldn’t ever get married to someone who puts their own parents and sisters first.
I’m an estates and elder attorney. There are some instances in which I tell clients that they don’t need wills, but it’s usually for older, single people who want everything to go to their living children and there is no debate or conflict over who would administer the estate. Do I think people can do their wills with an online service? Yes - for some people it can be a good option, but how will they know without an attorney to assess their situation and advise them as such? What attorneys do is help identify issues and they have the foresight to avoid potential problem areas that most clients never even think about. Also, I have had people show me wills that they did from online forms and they weren’t anywhere close to being done correctly - as in were not valid wills and would not be accepted as such by the court.
All that said - what you really should make sure you have is a Power of Attorney. That should NEVER, ever, ever be done without the advice and counsel of an attorney. And it should be either a trusts and estates attorney or an elder law attorney (who can advise you about drafting a POA that will allow family to do asset protection in the event you need long-term care)
Echoing what JHS said - in many states, the probate process, assuming a family that gets along and there are no complicating factors, can be pretty quick and painless. Many people have been sold a bill of goods and think they need a trust to avoid costs of probate. The reality is that a revocable trust, in most states, has very little benefit over a will, and doesn’t save you any money.
I will point out, though, even though most couples’ assets are held jointly, that’s not always the case. And when it’s not the case, you really have to look to the intestacy laws to see if they will give you the desired result. For example, in my state, if husband dies with $100,000 worth of assets held in his name, wife will get the first $30,000 and then split the rest with the children. So, if husband wants wife to inherit all 100,000, he needs to spell it out in a will. And if the will fails because it wasn’t executed correctly (which is probably the main reason online wills would be invalid), then we’re back in intestacy territory. But otherwise, I agree with the rest of JHS’s posts. Also, just having a simple will that names an executor and waives the bond requirement can save a lot of headache and expense. "
Oh, and I hear “we’ll cross that bridge when we come to it” all the time from my clients. I have to point out to them that there isn’t always opportunity to make the changes needed later. That’s why you hire lawyers - to anticipate and plan for those bridge crossings.
This discussion is reminding me of Wisconsin’s (and other states’?) marital property regimes, under which each spouse is considered to own not only one-half of all marital property but one-half of each asset that makes up the marital property. Half the car, half the microwave, half the TV set, etc. Couples can agree to divide the property at death based on aggregate value, however.
I want to make it clear that in my posts above I was not suggesting that people not bother to have a will in the first place. It’s a good idea to have a will. I was only suggesting that in many straightforward cases with a married couple there’s not a lot of need to agonize about the precise terms of the will, because they won’t affect the most important property.
I had a client die recently who had accumulated pretty substantial wealth. His will provided that everything should be held in trust for the benefit of his wife during her lifetime, and then distributed equally among their children. How much is in that trust? About $80,000 – the value of his car, the only significant asset he owned in his own name, and the proceeds of a life insurance policy he had purchased 50 years ago without naming a beneficiary. Everything else was in joint name or in a retirement account. It was enormously helpful to have a will appointing someone (his wife) as his executor. Among other things, that gives her the power to file all the tax returns and other reports that need to be filed, and to have all the accounts re-titled. But the trust itself is a pain in the butt – there’s no real value in having a trust that small. An online will would probably have given her his property outright, and that would have been better.
@Trixy34 is right, too, that the signing rules for wills can be very technical, and it’s easy to mess them up. If you don’t have an experienced lawyer or estates paralegal helping you with the signing, pay a lot of careful attention to the instructions for signing.
@JHS - point well taken. And I should point out that the only times I’ve advised people they don’t need a will were situations in which my clients were in declining health (as in not much time left), assets were minimal and would pass by rule of law - through joint accounts or to an IRA beneficiary, and family support was strong - children or siblings get along and have all agreed as to who will handle the client’s affairs. Usually in these cases, funds for estate planning are limited, and I offer to the client that they could possibly get by without a will. They have always had me do one anyway.
I think the thread shows the value in at least getting a consultaton, a validation you’ve considered things in the right ways and anticipated anything unusual. Before I decided to use the attorney, he offered a free sit down, went over a number of thinking points, total assets and types. Etc.
This was relatively recently. Now that it’s done, a relief, though I’m guessing something will be revised, in time. Many of your friends will likely have a recommendation. Mine happened to work with both the CPA and fin advisor. In fact, in the end, the fin guy helped with some final decisions on wording. On one hand, some think this in terms too simple, others get locked up in details. You want yours to accomplish what’s just right, for you.
We have a jointly held piece of real estate which is co-owned by BIL. It is an investment but both BIL and H are in their 69/70s and I think it may be good to speak with their cousin, a realtor and our estate attorney about options, especially as BIL is talking about retiring “soon.”
BIL has one “responsible” 31 year old who is estranged from less responsible 29 year old. Our 30 and 28 year old kids get along well and are both fiscally responsible.
It will be good to be clear on what options are available and desirable going forward, as that will affect estate planning for us and BIL.
Having lived in CA for decades, a trust is usually assumed to be smart if a house is involved. I can understand that a will and probate might be no big deal, but I have to admit, having dealt with three parent deaths in the last decade, what a blessing it was to have trusts and not deal with probate. Not that the probate would be difficult, but it would be one more thing to do, one more set of paperwork, one more entity. Everything takes so much time, even simple well-designed things with no problems, it just all can be overwhelming and absorb your life.
Probate is probably easier, though, than dealing with US savings bonds!
What’s the problem with bonds? I and my kids have never had any problem cashing them in at the bank. Or are you talking about bonds held in the name of the deceased, without a p.o.d. endorsement?
@HImom … my grandparents left real property to be held and split among their children and grandchildren, some of which was already held in coownership with others. That left me with a set of real property interests ranging from about 4% to 16%, depending on the history of the original property. I and many of the co-owners lived in distant states. It was nice having a little bit of income when properties were rented, but someone needed to manage that and otherwise it was a huge hassle. One of the properties got tied up in a lengthy lawsuit with a tenant…i don’t remember what the lawsuit was about, just that there was no rent coming in for a couple of years and I was potentially on the hook for legal fees and money damages if the tenant had prevailed.
Of course with my fractional shares I had no real say in how the property was managed nor any practical way to sell my shares unless a co-owner wanted to buy me out.
So I don’t think it’s a good idea to split real property among legatees. Either have the property sold as part of the estate or put it in a trust, where the trustee has power of sale if appropriate. But you dont want the property held in the names of the next generation, especially when you are already seeing two who are estranged from one another.
The paper bonds needed to be converted to e-bonds as they no longer sell paper bonds, we were taking Dad’s name off and he had a ton of small bonds, like 70, big list of similar numbers making me cross eyed and the Treasury Direct website is about as poorly designed and poorly functioning as you might expect from the lowest bidder. My parents gave some bonds to great grandkids and when they could no longer buy paper bonds and had to do e-bonds, the delivery process was ridiculous, it took over a year for one kid to create a profile and accept their bonds as it was such a pain she kept giving up.