I have had it. After 15 years of practicing in the field of wills, trusts and estates, I am furious about the number of poorly prepared trust agreements from the 1980's and 1990's that have come across my desk in my role as attorney for a successor trustee.
Here's the problem. Mom or Dad, or both, probably paid some attorney quite a nice sum of cash to have a trust agreement prepared. They were probably assured that their estate would avoid probate - and that the administration of their estate would be much less complicated.
Sounds great, doesn't it? And it works - if the agreement was prepared correctly, if the right people were named in the right roles and if the client didn't make any mistakes in funding or accidentally "unfunding" their trust before they died.
Now Mom and Dad have passed away, and I'm representing their child as trustee - et voila! A significant asset (or two... or more...) is found to be not in the trust, often causing a probate of those unfunded assets.
What went wrong? Well, it would be fun to place blame on the attorney who prepared the documents - they've probably long since retired or passed away - but in many cases it's not the attorney's fault. Let's figure out why...
If Mom or Dad hired an attorney to prepare certain documents, that attorney's role is probably complete once the documents have been signed and returned to Mom or Dad - unless some agreement between Mom or Dad and the attorney states otherwise. For the attorney to agree to monitor Mom and Dad's estate until they pass away would create an incredible and potentially impossible burden on the attorney -- and knowing most attorneys, it would probably require a steep monthly retainer. So I don't see those types of arrangements very often.
Is it Mom or Dad's fault? Well... yes and no. In some ways it's no different than buying a new lawn mower - you take care of it and keep it in the garage the first few years and eventually it ends up rusting out behind the barn.
In other words, time passes... things change. What may have been important to Mom and Dad when they had the trust created may be just a rusty old idea by the time Mom and Dad pass away. Trust agreements, like old lawn mowers, get neglected. So... before it's too late... can you trust your trust agreement? If you're not sure, maybe it's time to haul it out and take a look.
Thursday, April 16, 2009
Tuesday, April 14, 2009
Trust Attorney to Speak in Holt
Jo Anne Hinds will teach a seminar on Wills & Trusts on Wednesday, April 29, 2009 for Holt Community Education. Visit www.holtcommunityed.com to get registration details.
Tuesday, September 23, 2008
Learn About Living Trusts with Holt Community Education
On Saturday, Sept. 27, from 10 a.m. to noon, Holt Community Education offers a class called "What You Need to Know About Living Trusts" at Holt Junior High School.
If you have questions about your trust agreement -- or if you don't have a living trust, but are wondering if you might need one, this two-hour class may be an excellent place to get some valuable information at a reasonable cost.
This class will begin with a simple overview of why and how living trusts are used today. Learn how to talk about your trust agreement with your family in simple, everyday language and how to create a strategy to ensure your trust accomplishes its intended purpose.
Maximize your living trust's potential by understanding how trusts and other documents can be used together to protect your estate. You might wish to consider bringing the person you've asked to serve as your successor trustee to ensure they understand what their role may someday be in your estate.
An informal class format encourages questions and discussion.
The cost is $20/person or $25/couple for a one session class.
Please contact Holt Community Education by phone at 517-694-3411 or by e-mail at comed@hpsk12.net to inquire about class availability.
If you have questions about course content, please email me at or call (517) 285-5353.
Other upcoming classes offered in Holt include "Wills and Trusts for Today's Smart Parents" scheduled for Wednesday evening, Oct. 15, 2008 from 6 p.m. to 7:30 p.m.
If you have questions about your trust agreement -- or if you don't have a living trust, but are wondering if you might need one, this two-hour class may be an excellent place to get some valuable information at a reasonable cost.
This class will begin with a simple overview of why and how living trusts are used today. Learn how to talk about your trust agreement with your family in simple, everyday language and how to create a strategy to ensure your trust accomplishes its intended purpose.
Maximize your living trust's potential by understanding how trusts and other documents can be used together to protect your estate. You might wish to consider bringing the person you've asked to serve as your successor trustee to ensure they understand what their role may someday be in your estate.
An informal class format encourages questions and discussion.
The cost is $20/person or $25/couple for a one session class.
Please contact Holt Community Education by phone at 517-694-3411 or by e-mail at comed@hpsk12.net to inquire about class availability.
If you have questions about course content, please email me at or call (517) 285-5353.
Other upcoming classes offered in Holt include "Wills and Trusts for Today's Smart Parents" scheduled for Wednesday evening, Oct. 15, 2008 from 6 p.m. to 7:30 p.m.
Sunday, November 18, 2007
Me, Myself and I - A Commentary on Estate Planning for Single Individuals with No Lineal Descendants
An individual calls to talk about the preparation of a will and living trust. "I'm single, and I've got no kids of my own - so this should be pretty simple, right?"
Not always, but simplicity may be your primary goal. As with any client, there are unique planning considerations that should be raised, discussed and resolved in order to make the end result run as smoothly as possible. Let's take a look at just a few of them here.
Choosing a fiduciary. Choosing a fiduciary in any situation is an extremely important choice - and one that is often easily overlooked in the haste to choose the "appropriate" or "expected" person to fill the role. In this situation, siblings, parents, or nieces and nephews - as well as friends or trusted advisors - sometimes fill the fiduciary roles created by the estate plan. A fiduciary, simply put, is someone who undertakes the legal responsibility of acting on behalf of and for the benefit of another person. Examples of fiduciaries are patient advocates (medical powers of attorney), agents (financial durable powers of attorney), personal representatives (wills), guardians, conservators and trustees.
Making an estate administration run as smoothly as possible for those who undertake a fiduciary role may be an important factor to you. It's not as easy as simply plugging names into a document. Consideration should be given to the fiduciary's age, future plans, location, ability and willingness to undertake the assignment.
Ask yourself who would naturally fall into the role - for example, who would you expect to go with you to a doctor's appointment if you couldn't drive yourself for some reason? If one person jumps to mind, they might be a logical choice for patient advocate. There are, of course, other factors involved. In my practice, it is fairly common to schedule a meeting with the potential fiduciaries to discuss the appointment in advance of executing the documents.
Choosing someone ill-fitted to be a fiduciary can have disasterous results - for example, costly public court proceedings regarding your competency could someday be required, including the probate court appointment of guardians or conservators and the continued public adminstration of your estate during your lifetime or, hearings may be required to appoint a corporate successor trustee. Careful planning now can avoid these costly and time-consuming results.
Charitable giving. If you're single with no children, you may be more likely to make charitable giving an important goal in planning your will or trust - even more so than others who are similarly situtated financially. Popular choices, in addition to large organizations like the American Cancer Society or the Alzheimer's Association, sometimes include local religious institutions, a favorite college or the local humane society.
To ensure that a charitable gift makes it to where it is supposed to go, it's important to know the exact legal name of the charity. You or your attorney can make a quick, anonymous call to the charitable organization of your choice to determine the correct legal name of the organization.
Treasured relationships rewarded. Less burdened by a parent's need to "make everything fair," an individual without children is more likely to reward treasured relationships, such as close friends, helpful nieces or nephews or others with specific gifts, devises, or distributions from a trust - and not always in equal amounts.
You can think about the division of your estate among these individuals in the form of specific gifts of dollar amounts, certain assets or a percentage of your estate. Your attorney should be able to counsel you regarding the viability of any particular distribution plan, and make suggestions for improvement to ensure your goals are carried out to your specifications.
Continued control of devised assets less of a concern. While not always the case, many individuals without children choose a quick administration requiring immediate distributions to beneficiaries free from trust. However, many "boilerplate" trust documents contain separate trust language or common trust language that requires the trustee to retain and control the assets held in trust for a number of years after your death or until a beneficiary reaches a certain age or educational level.
If continued control of your estate is not as important to you as keeping the estate administration as simple as possible, you may wish to be sure your beneficiaries receive their distribution outright and free from trust. Talk to your attorney to ensure your documents meet your expectations.
Likely to do-it-yourself? Assuming that estate planning for single individuals without children is less complicated than other planning is a mistake. And, some fill-in-the-blank forms assume the existence of a spouse and children. For many reasons, estate planning can be even more important for those without them.
Choose an attorney who appreciates your unique situation and goals - some lawyers offer free or reduced rate initial consultations by phone or in person, so you may have the chance to talk with them before you make a financial commitment. Always read your documents carefully to ensure they meet your expectations.
Not always, but simplicity may be your primary goal. As with any client, there are unique planning considerations that should be raised, discussed and resolved in order to make the end result run as smoothly as possible. Let's take a look at just a few of them here.
Choosing a fiduciary. Choosing a fiduciary in any situation is an extremely important choice - and one that is often easily overlooked in the haste to choose the "appropriate" or "expected" person to fill the role. In this situation, siblings, parents, or nieces and nephews - as well as friends or trusted advisors - sometimes fill the fiduciary roles created by the estate plan. A fiduciary, simply put, is someone who undertakes the legal responsibility of acting on behalf of and for the benefit of another person. Examples of fiduciaries are patient advocates (medical powers of attorney), agents (financial durable powers of attorney), personal representatives (wills), guardians, conservators and trustees.
Making an estate administration run as smoothly as possible for those who undertake a fiduciary role may be an important factor to you. It's not as easy as simply plugging names into a document. Consideration should be given to the fiduciary's age, future plans, location, ability and willingness to undertake the assignment.
Ask yourself who would naturally fall into the role - for example, who would you expect to go with you to a doctor's appointment if you couldn't drive yourself for some reason? If one person jumps to mind, they might be a logical choice for patient advocate. There are, of course, other factors involved. In my practice, it is fairly common to schedule a meeting with the potential fiduciaries to discuss the appointment in advance of executing the documents.
Choosing someone ill-fitted to be a fiduciary can have disasterous results - for example, costly public court proceedings regarding your competency could someday be required, including the probate court appointment of guardians or conservators and the continued public adminstration of your estate during your lifetime or, hearings may be required to appoint a corporate successor trustee. Careful planning now can avoid these costly and time-consuming results.
Charitable giving. If you're single with no children, you may be more likely to make charitable giving an important goal in planning your will or trust - even more so than others who are similarly situtated financially. Popular choices, in addition to large organizations like the American Cancer Society or the Alzheimer's Association, sometimes include local religious institutions, a favorite college or the local humane society.
To ensure that a charitable gift makes it to where it is supposed to go, it's important to know the exact legal name of the charity. You or your attorney can make a quick, anonymous call to the charitable organization of your choice to determine the correct legal name of the organization.
Treasured relationships rewarded. Less burdened by a parent's need to "make everything fair," an individual without children is more likely to reward treasured relationships, such as close friends, helpful nieces or nephews or others with specific gifts, devises, or distributions from a trust - and not always in equal amounts.
You can think about the division of your estate among these individuals in the form of specific gifts of dollar amounts, certain assets or a percentage of your estate. Your attorney should be able to counsel you regarding the viability of any particular distribution plan, and make suggestions for improvement to ensure your goals are carried out to your specifications.
Continued control of devised assets less of a concern. While not always the case, many individuals without children choose a quick administration requiring immediate distributions to beneficiaries free from trust. However, many "boilerplate" trust documents contain separate trust language or common trust language that requires the trustee to retain and control the assets held in trust for a number of years after your death or until a beneficiary reaches a certain age or educational level.
If continued control of your estate is not as important to you as keeping the estate administration as simple as possible, you may wish to be sure your beneficiaries receive their distribution outright and free from trust. Talk to your attorney to ensure your documents meet your expectations.
Likely to do-it-yourself? Assuming that estate planning for single individuals without children is less complicated than other planning is a mistake. And, some fill-in-the-blank forms assume the existence of a spouse and children. For many reasons, estate planning can be even more important for those without them.
Choose an attorney who appreciates your unique situation and goals - some lawyers offer free or reduced rate initial consultations by phone or in person, so you may have the chance to talk with them before you make a financial commitment. Always read your documents carefully to ensure they meet your expectations.
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