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Old 12-14-2022, 02:37 PM   #61
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I’m under the impression that assets that transfer on death via a beneficiary designation does not need to be in the trust. Insurance, brokerage accounts etc. our lawyer reviewed what we had and recommended that a trust was unnecessary as a result.

TOD/POD/beneficiaries work for in the case where the owner dies.
If the owner gets dementia and the court appoints you as successor trustee a trust allows you to assume control of the assets via the trust documents. Otherwise you have to upload the court case/medical history and whatever the institutions lawyers require for re-titling the accounts.
At least it was a lot easier when I had to assume control of trust assets than it was to assume control of non-trust assets while the grantor. YMMW.
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Old 12-14-2022, 02:38 PM   #62
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A trust can be used for many objectives.
Tax laws-preservation of exemptions
Probate laws-attempt to avoid probate, not likely, but worth the try
Asset distribution to minors, or conditional distributions that are extensive
IRA distribution preservation of stretch control (maybe worthwhile, not likely due to trust tax rate schedules)

Nothing wrong with TOD, or even simple joint or tenants in common, but may not address the above intents.
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Old 12-15-2022, 11:06 AM   #63
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I thought I'd give my example of what I helped my dad set up before his death.

Checking Account: took dad to bank and had him put me on a joint owner. This took care of paying for expenses after he died (and a few before)

Savings Accounts / CD's: Had dad set up POD/TOD with my brother and me.

Brokerage Account: Even though I had DPOA, they required a separate form. I went to Scottrade, picked up the form and took it home for Dad to sign. This came in handy, because a few days before his death I went ahead and just sold his (minor) stock holdings converting everything to cash. Since his death was early in the year, it had no effect on his taxes.

Car: Had my name added to title. Probably wasn't necessary, but made it easy when I sold it.

EE Bonds: Sent off about 30 EE bonds to have my name added as Co-owner. Did this about a year before his death.

House: Went to lawyer and did a TOD with my brother and I as contingent owners.

After his death, it was easy. No probate. Didn't even file the Will. The only thing that was not joint/POD/TOD was household goods and DB and I just split up what we wanted and threw the rest in the dumpster (or gave away).

DW and I currently have a similar set up.
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Old 12-15-2022, 11:36 AM   #64
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Good example,

Quote:
Originally Posted by PatrickA5 View Post
I thought...

After his death, it was easy. No probate. Didn't even file the Will. The only thing that was not joint/POD/TOD was household goods and DB and I just split up what we wanted and threw the rest in the dumpster (or gave away).

DW and I currently have a similar set up.
But pending on what state your in;
For Probate to be required by far, the most common reason for probate is that the Decedent died holding:
Any real property titled in his or her own name, or
Personal property (usually a cash or securities account) titled in his or her own name whose value exceeds $100,000.
However
Will: Washington law, however, does require any last Will of a Washington resident Decedent to be filed promptly following death.

I would guess if there was no will, it would not be filed and if the above probate conditions are met, no probate is required. So for small estates there is some easy way out, so to speak.

So we live in WA, but until we get to the point of making some major gifts we need the protection of a trust.

We had a similar situation with our mother, and we split the estate without probate since we all were joint on all titled assets. Earlier, I posted about my FIL that had the Florida lawyer with the trust, that was a mess.
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Old 12-15-2022, 12:29 PM   #65
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I should add that I contacted my Attorney (also my dads) and she said there was no reason to file the Will if all that was left was household stuff. Of course, she cautioned that if there was any chance my brother and I would have problems with splitting the remaining items, then it might be best to file the will. I'm not sure how filing the will would have helped with that.

My state does have a "small estate" provision, but we didn't need it since we didn't need to file the will.
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Old 12-15-2022, 12:33 PM   #66
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Good example,




Will: Washington law, however, does require any last Will of a Washington resident Decedent to be filed promptly following death.
So, does that mean if one spouse dies the other has to file the will even if everything is jointly owned (or TOD/POD)?

I know my parents and DW's parent didn't file probate when the first spouse died.
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Old 12-15-2022, 12:41 PM   #67
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Hmm yeah maybe I need to fire my lawyer who I just met. I don't see that I need a trust at all but the point is to avoid probate. He was not encouraging about making a will only and I said its because you make more from a trust and he said well actually I make more on probate. IDK. Since all things have beneficiaries except house I do not see that I have any assets at all - for this purpose.
I am the executor of my dear Mom's estate. While we had most assets held jointly with my siblings, the assets held directly went through probate. The attorney's fee for estate is set by your state or county. My attorney chose to waive 1% of the 4% fee of the neighboring county where Mom lived. In my county the fee is 3%, so quite a big difference.
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Old 12-15-2022, 01:21 PM   #68
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Good example,



But pending on what state your in;
For Probate to be required by far, the most common reason for probate is that the Decedent died holding:
Any real property titled in his or her own name, or
Personal property (usually a cash or securities account) titled in his or her own name whose value exceeds $100,000.
However
Will: Washington law, however, does require any last Will of a Washington resident Decedent to be filed promptly following death.

I would guess if there was no will, it would not be filed and if the above probate conditions are met, no probate is required. So for small estates there is some easy way out, so to speak.

So we live in WA, but until we get to the point of making some major gifts we need the protection of a trust.

We had a similar situation with our mother, and we split the estate without probate since we all were joint on all titled assets. Earlier, I posted about my FIL that had the Florida lawyer with the trust, that was a mess.
Also a WA resident and just concluded FIL estate that had all the real estate in Living Trust. Sales went through relatively once title company had copy of trust agreement. If you haven't made yourself a digital copy, suggest you do so--makes your life so much easier. Note my post up thread on the crazy zoo we had to endure getting a checking account in trust name. Nearly every bank would not accept trust or do much of anything without a probate court order.
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Old 12-15-2022, 07:05 PM   #69
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Quote:
Originally Posted by PatrickA5 View Post
I thought I'd give my example of what I helped my dad set up before his death.

Checking Account: took dad to bank and had him put me on a joint owner. This took care of paying for expenses after he died (and a few before)...
Just beware there is a potential downside to your DF adding you as a joint owner of his checking account... if you get sued then his checking account could be at risk. Unlikely, but a good reason to avoid keeping a lot of money in such a checking account.
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Old 12-15-2022, 09:33 PM   #70
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Yep darn sure all other things are TOD/POD except the house. Not like I have such a vast amount of assets I will forget.!! Unfortunately.

I asked why I can't just get the benef deed + will + POA etc and never got much of an answer just "a trust is better". Better for him I assume.

But yeah the trust did come with the will etc. It just the trust part I question the need for - not the rest. Why is everything so much trouble . . .

Maybe because I am not that interested in this process and sick to death of this new bp med that makes me feel crappy. They have agreed I can wean off and try something else.
You might "forget" if you succumb to Alzheimer's. I have an Aunt that this happened to and she doesn't have any of her financial affairs in order. Although she wouldn't have had them in order regardless of being struck by the disease...just one of those know-it-all yet completely ignorant types of personality. Now she can't remember where she parked her car (and she deosn't own a car)...which is scary.

Trusts are helpful if you own real estate in multiple states. The key is to re-title the property into the Trust otherwise it won't help much to avoid probate...which is IMHO one of the main benefits of a trust. If you can handle all your assets with TOD and beneficiary designations, save your money. I have a living will. I saved it on a USB flash drive, its also in the cloud on a google drive and I have a printed out copy. No disputing that if you have all 3 you know exactly what I want done with my assets when I die. I have supplemental informational documents that also outline some somewhat non-will types of things. General guidance on investing after I am gone...more of a suggestion as I can't really dictate that from the grave. Some of it can be, but what to actually buy in terms of ETFs/stocks etc would be handled by the Trustee.

Oh, that is one other important thing. Make sure you have the docs in place designating a trustee and a backup. And of course POA and Medical Directive. Pro-Tip, not all finance buffs are also great caregivers and sound with medical decision-making...and also it might be too much of a burden to have the same person in charge of care that is the Trustee. Cutting checks AND changing bed pans...just cruel.
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Old 12-16-2022, 08:54 AM   #71
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Just beware there is a potential downside to your DF adding you as a joint owner of his checking account... if you get sued then his checking account could be at risk. Unlikely, but a good reason to avoid keeping a lot of money in such a checking account.
True. That's why we have avoided adding any of our kids to any of our accounts. But, when we get older we'll probably open a separate checking and add a kid to it - but not keep a lot of money in it.

When my DB and I took dad down to put our names on his checking account we really got the "evil eye" from the lady at the bank. Which is a good thing, I guess. Although he was early 90's, he was still pretty sharp and had no problem convincing the lady that it was ok.

It sure made things easier. I could pay bills and had a place to deposit checks made out to dad. Even direct deposited his tax refund into it almost a year later.
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Old 12-16-2022, 09:21 AM   #72
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If your assets have a beneficiary, TOD or POD they do not need to be in a trust. We do have a trust and the only assets in it are our house and a brokerage account. Our state does not allow a TOD. The cars will be handled under a small estate provision. TOD and POD are very state specific. You need a lawyer that will go through this with you, not leave you googling to make a new list. I suggest firing that lawyer.
Well said. Yes I got rid of that one. Got a new one coming up 12/19.
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Old 12-16-2022, 10:21 AM   #73
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TOD/POD/beneficiaries work for in the case where the owner dies.
If the owner gets dementia and the court appoints you as successor trustee a trust allows you to assume control of the assets via the trust documents. Otherwise you have to upload the court case/medical history and whatever the institutions lawyers require for re-titling the accounts.
At least it was a lot easier when I had to assume control of trust assets than it was to assume control of non-trust assets while the grantor. YMMW.
As a co-trustee from the outset you can act just as any other trustee (e.g. the grantor) when it becomes clear they can't handle their affairs.

When mom started destroying mail I simply changed the mailing address so everything critical to came to me (still addressed to her) instead.
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Old 12-16-2022, 11:15 AM   #74
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As a co-trustee from the outset you can act just as any other trustee (e.g. the grantor) when it becomes clear they can't handle their affairs.

When mom started destroying mail I simply changed the mailing address so everything critical to came to me (still addressed to her) instead.
Yes. But. The grantor still has the authority to transact as well. The institution has no visibility to the fact that they can't handle their affairs. And the definition of "becomes clear they can't" is unclear... unless they are naked in the front yard howling at the moon everybody seems to think they're not that bad... the phrase I constantly heard was "they're still making decisions, they are just bad decisions".
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Old 12-16-2022, 12:33 PM   #75
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Then what is a financial POA for? I thought they could spend my money if I was not able to do so to pay bills.
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Old 12-16-2022, 02:24 PM   #76
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Yes. But. The grantor still has the authority to transact as well. The institution has no visibility to the fact that they can't handle their affairs. And the definition of "becomes clear they can't" is unclear... unless they are naked in the front yard howling at the moon everybody seems to think they're not that bad... the phrase I constantly heard was "they're still making decisions, they are just bad decisions".
Assuming they're still getting their mail.

To be fair mom never used a computer & the nature of her illness caused her to become very passive, so she really didn't notice that I diverted all the critical stuff to myself.

And as co-trustee I didn't have to jump through any hoops to take over her affairs once it was clear she could no longer handle them.
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Old 12-16-2022, 02:42 PM   #77
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Then what is a financial POA for? I thought they could spend my money if I was not able to do so to pay bills.
If you have are at least competent enough to not make bad decisions, then a financial POA works well. Your POA can pay your bills.

If you start to make bad decisions, then the only way to get you to stop that I know of is for your POA or other interested persons to establish a conservatorship. This requires a court hearing and order (time/$/hassle). It may not work because you may be or appear competent enough during the hearing for the judge to think that you're OK. I think there's a fairly high bar for conservatorships because they're taking away an adult's autonomy, and once established can be from very difficult to impossible to undo (see Britney Spears).
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Old 02-15-2023, 05:03 PM   #78
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I signed up for the annual legal plan from my employer. It's the Arag Legal plan which includes creation of Wills and Trusts.

I have a meeting with the sstate planning lawyer on Friday to start the process of creating a will for my wife and me. Not sure whether I will create a trust at this time.

For the will package, I plan to have the lawyer create the following documents for my and me:

- Medical Power of Attorney
- Living Will
- Financial Power of Attorney
- Durable Power of Attorney ??
- Beneficiary Designations
- Real Estate Transfer on Death Deed
- Last Will & Testament

Are there any other documents I should consider?

I'm hoping that TOD & POD designations and beneficiary designations will handle anything I missed in the will.

Thanks
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Old 02-15-2023, 05:10 PM   #79
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Just remember, POD & TOD take precedence over a Will.

So for example if all your bank accounts and brokerage accounts are TOD/POD, then there is no actual cash for the Will to distribute until perhaps a house/belongings are sold.

Meaning the Will is to handle anything the TOD & POD missed.
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Old 02-15-2023, 05:13 PM   #80
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Just remember, POD & TOD take precedence over a Will.

So for example if all your bank accounts and brokerage accounts are TOD/POD, then there is no actual cash for the Will to distribute until perhaps a house/belongings are sold.

Meaning the Will is to handle anything the TOD & POD missed.
Thanks...

Should I consider a "Durable Power of Attorney" document as well?
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