Estate Planning Problems

As far as a corporate trustee our wellrespected local estate attorney told us to use a local bank so setup a (virtual) meeting with 2 local banks and got all the info on process and price, and there was a clear standout and I selected them. They only charge a percentage on what is probated, and with our trust (yes we went that route to avoid probate) then their fees as trustee/executor will be fairly low but well earned bc like you I dont have a trusted close family member that could do it in our stead. Unanswered is what to do with the bulk of the money if we dont want to leave it all to our sole child. Could be enough to ruin her potentially so shaping her character has taken the front burner position over figuring out disposition of assets longest term. What we have in place will serve us for perhaps 10 years. We plan to revisit.
 
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A second reason is to avoid probate for the executor of the estate and beneficiaries. Things transfer much more easily through a trust.

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Agreed. Here is an example. I am currently involved in a situation where a will was left but no trust. The decedent was a good friend of mine who had been divorced 40+ years and had not been in touch with his ex-wife or son. He died leaving a will that named multiple beneficiaries, including me (a complete surprise to us). He left his son his house.
he will went to probate, and his ex-wife has challenged it claiming that everything should go to the son (who apparently is disabled and she is the guardian), and that my friend was coerced into setting up the will (since he did it after finding out he had cancer).

Watching the letters fly between her attorneys and the executor for the past 2 years have been interesting. A court date is coming up in a couple of months, which will also be interesting.
 
My wife and I are in a situation similar to the OP, with no kids and no family (well, no family suitable to act as our successor trustee). Our trust "adventure” started in June of last year with me reading several books about trusts (Nolo and Dummies). Then we started engaging two large financial institutions trust departments.

We first considered Fidelity as trustee and it was not a good experience. We found it astonishing how poorly they engage with would-be customers. They would not tell us what language needed to be in the trust documents. Instead, they wanted us to draft the trust, send it to them, and then make the changes they require to it. I thought that would require too much of a costly back and forth. Schwab was next on the list for us. That experience was also very disappointing. We gave up on them, despite their being less expensive than Fidelity.

One thing to keep in mind with both of them is that they charge an administration fee for the trust, and they require that they manage the investments in the trust which is another 1%. This may not be too bad if the trust will be emptied quickly. But if you and your spouse are both incapacitated, or one spouse passed and the remaining spouse is incapacitated, then they as trustee will take over when you are not able to take care of your assets. You could be incapacitated for several years and they would be investing your assets as they see fit during that time and charging the trust admin fees and the investment management fees.

By September we felt our only option was to use a local estate planning firm as successor trustee and our agent with POA. We contacted a few attorneys and met for interviews. We settled on a small firm about 45 minutes from our home and had a 60 minute meeting with them to go over the forms they had asked us to fill out regarding our final wishes. We then paid $6,100 up front for a pour-over will, healthcare directives, durable POA, and the trust document. They were the second-most expensive of the attorney’s we considered.

Four or five weeks passed and they sent us drafts. All in, about 140 pages to read. And yes, we did read them all. That took us two weeks to get through. It seems like our draft is entirely "canned". We don't see much of how they incorporated any of what we originally asked for. So much legal jargon and contingency branches that we grew frustrated and quite depressed. This resulted in several pages of questions and potential changes to the documents so I called the attorney and asked how much time they allowed (as part of our $6,100) for review, questions, etc. Shocking that they only allow one hour of unpaid follow-up. Everything else is billed at the attorney’s hourly rate and there was no option to discuss our concerns with their paralegal who is less costly per hour.

I asked how an hour could be considered enough time and they said that most of their clients do not read the documents. They just sign them and go on their way. I questioned this and they said we were very unusual in that we read and wanted to understand the trust. They said most clients do not even ask for a draft to read before they come in to sign the docs! Since we had been planning to give them immediate durable powers of attorney and make them our successor trustee, it seemed prudent to understand how we were handing over our assets and final care to them. But now we are the troublemakers for them because we have a list of questions and changes.

And speaking of changes, they don’t want us to make changes and even said the much of the document content can not be changed.

The earliest appointment we can get to visit and discuss is late April which is aggravating to the highest degree. We’ve had to learn so much about this whole process and waiting 7 weeks means we’ll have to refresh ourselves on so much of it. We’ll need 10 hours here at home just to re-review the trust and our questions so that we can effectively use the time in their office.

So now we are regretting this big time. And we have spent a lot of time thinking about asking a family member to act as POA and successor trustee. This person is ill-suited for this endeavor. Being a trustee is not easy and there is a Nolo guide written specifically to help trustees, and it starts by explaining how hard it is to do and how much consideration much be given before accepting the role. But we are starting to think that it is a better option than offering the role to this estate planning firm. After all, our family member could and should use the estate assets to pay for a competent attorney, accountant, etc to help administer the trust when the time is right.

So I suspect that by the time we finish this, a year will have passed since we started. It will have been a year of life lost. Twelve months spent thinking about dying and incapacity is a depressing year. Then add on the thoughts of getting treated poorly by an attorney.

I wish you well.
 
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A trust protects your assets prior to death, a will distributes assets after death. Isn't that correct? As I understand it, I can be sued, but my trust is untouchable as it's technically not my funds until I take a distribution.
My estate planning attorney charged us $1,500 for both our wills, our trust and both our durable powers of attorney for financial and medical. We have since visited him every 3 years for a review and any changes. The last we were able to ZOOM meeting the exchange. Most changes are due to changes in state law that would have affected our wishes. Gotta watch those politicians or they'll change the rules before you know it and can counter with document mods.
 
he will went to probate, and his ex-wife has challenged it claiming that everything should go to the son (who apparently is disabled and she is the guardian), and that my friend was coerced into setting up the will (since he did it after finding out he had cancer).
My will stipulates that anyone contesting the will has their portion canceled and they are no longer inheriting anything. I've explained this to my heirs that it's iron clad; contest my will and get nothing, keep your mouth shut and you'll get what I want you to get.
I can dig out the exact language if you would like, but since these sorts of things are based on individual state laws, it might not apply where you live.
 
My thinking is that in most cases, lawyers will suggest a trust automatically because it's a no-brainer. Reading the first post, that was my SGOTI reaction.

We have a set of trusts and they also specify what we want if both of us were to die at the same time. As far as an executor, a lot of people with no 'good' relatives to manage will use an attorney.

Welcome to a first world, rich person's reality! If you have enough assets to worry about, you're going to need a good estate attorney, among other professionals both now and after soul leaves body. Pay up!
 
A trust protects your assets prior to death, a will distributes assets after death. Isn't that correct? As I understand it, I can be sued, but my trust is untouchable as it's technically not my funds until I take a distribution.
My estate planning attorney charged us $1,500 for both our wills, our trust and both our durable powers of attorney for financial and medical. We have since visited him every 3 years for a review and any changes. The last we were able to ZOOM meeting the exchange. Most changes are due to changes in state law that would have affected our wishes. Gotta watch those politicians or they'll change the rules before you know it and can counter with document mods.
That’s incorrect. A typical revocable trust does not protect your assets. Your assets will be distributed according to the instructions in the trust. The will should be a pour over will to put other assets not in the trust, into the trust.
 
My will stipulates that anyone contesting the will has their portion canceled and they are no longer inheriting anything. I've explained this to my heirs that it's iron clad; contest my will and get nothing, keep your mouth shut and you'll get what I want you to get.
I can dig out the exact language if you would like, but since these sorts of things are based on individual state laws, it might not apply where you live.

I will have to see if that wording is in the will, but I believe in my state it does not seem to matter, once it goes to probate anything in it can be challenged. For example, under the guise of "we feel the person was coerced into that statement". They keep the lawyers happy in our state... :).
 
My thinking is that in most cases, lawyers will suggest a trust automatically because it's a no-brainer. Reading the first post, that was my SGOTI reaction.
Why is it a "no-brainer"? (I have read the first post and all the rest up to here.) I have had wills as part of the typical package of documents (will, living will, durable POA, etc.) drafted twice in my life, by two different estate planning lawyers, and neither suggested a trust. The most recent was just a year ago. My wife and I have no children or very close family we wish to leave anything to. Most of our assets are owned jointly or have each other designated as beneficiaries, so they would pass outside the will. Probate of the remainder wouldn't be a big deal in our case. We do have family designated with POAs in the unlikely even both of us should be incapacitated. What could a trust accomplish for us that would be worth the extra hassles and expense? Far from saying nobody needs a trust, I recognize they are useful in many estate plans, but it seems to me it's going too far to say it's a "no brainer in most cases."
 
Why is it a "no-brainer"? (I have read the first post and all the rest up to here.) I have had wills as part of the typical package of documents (will, living will, durable POA, etc.) drafted twice in my life, by two different estate planning lawyers, and neither suggested a trust. The most recent was just a year ago. My wife and I have no children or very close family we wish to leave anything to. Most of our assets are owned jointly or have each other designated as beneficiaries, so they would pass outside the will. Probate of the remainder wouldn't be a big deal in our case. We do have family designated with POAs in the unlikely even both of us should be incapacitated. What could a trust accomplish for us that would be worth the extra hassles and expense? Far from saying nobody needs a trust, I recognize they are useful in many estate plans, but it seems to me it's going too far to say it's a "no brainer in most cases."
What happens if you both happen to pass at the same time? Do you have contingent beneficiaries? Does the state decide who gets what?
 
Why is it a "no-brainer"? (I have read the first post and all the rest up to here.) I have had wills as part of the typical package of documents (will, living will, durable POA, etc.) drafted twice in my life, by two different estate planning lawyers, and neither suggested a trust. The most recent was just a year ago. My wife and I have no children or very close family we wish to leave anything to. Most of our assets are owned jointly or have each other designated as beneficiaries, so they would pass outside the will. Probate of the remainder wouldn't be a big deal in our case. We do have family designated with POAs in the unlikely even both of us should be incapacitated. What could a trust accomplish for us that would be worth the extra hassles and expense? Far from saying nobody needs a trust, I recognize they are useful in many estate plans, but it seems to me it's going too far to say it's a "no brainer in most cases."
Like so many things on this forum, a lot depends upon how much money is involved. Ten million dollars is a different cat than a few hundred thousand with a lot more opportunity for different interpretations.

My knee jerk is just based on personal experience. To me, if there are significant dollars involved, a trust just provides a bit more clarity and certainty when the time comes. As noted, we also have provisions in the event we both pass together, we have a dozen+ heirs and no children, as well as a special needs situation coupled to notable income in perpetuity. YMMV
 
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I appreciate all of the replies. Obviously, different strokes for different folks. For us, with 85% of assets in financial accounts that have primary and contingent beneficiaries that will pass before wills or trusts are involved, I think I'll go with a simple will. In this state I can also put a contingent beneficiary on our house deed. There won't be much left for probate even if we die at the same time. We'll ask a family member to be our contingent executor and tell them to hire an estate attorney, CPA, realtor, and whatever else they need for the probate process.

Like Mercy Me, I have become totally frustrated with what attorney's charge and the conflicting statements they make while pushing trusts. I just can't see paying thousands of extra dollars for a trust in our case. Twenty years ago, trusts were for the super wealthy and everybody else got wills, or nothing if they had little assets.

To each their own. Thanks again for the feedback.
 
My will stipulates that beneficiaries must survive me by "x" number of days to be considered a beneficiary. Otherwise, the terms of the will as if they had pre-deceased me takes place. No questions about dying at the same time, an hour later or a single day. DW's will reads the same.
 
What happens if you both happen to pass at the same time? Do you have contingent beneficiaries? Does the state decide who gets what?
Yes, we have contingent beneficiaries in our wills and designated on our investment accounts that allow that. Not a reason to resort to a trust, as far as I'm aware.
Like so many things on this forum, a lot depends upon how much money is involved. Ten million dollars is a different cat than a few hundred thousand with a lot more opportunity for different interpretations.

My knee jerk is just based on personal experience. To me, if there are significant dollars involved, a trust just provides a bit more clarity and certainty when the time comes. As noted, we also have provisions in the event we both pass together, we have a dozen+ heirs and no children, as well as a special needs situation coupled to notable income in perpetuity. YMMV
I completely concur. I was just questioning the assertion that in "most" cases it's a no-brainer. I doubt most people who seek estate planning (in 2025) have 10 million dollars, and high net worth individuals likely have more complex situations than most people. Even people with modest assets should have a will. I suspect fewer will benefit much from a trust, and with the costs and fees it may not be worth it to most people.
 
My point was that many here view attorneys as parasites with little, to no sense of fiduciary responsibility.

My guess is that the net worth of most here is somewhere between $1MM and $6MM in assets. At that level of wealth, whether accumulated slowly or suddenly, you're no longer in Kansas anymore and you're exposed to notably more vulnerabilities (and opportunities) than the weekly paycheck crowd is, not only for yourself but your heirs as well. As Cindy Lauper sang "Money changes everything".

Personally, I view attorneys (and tax accountants) as just a necessary evil of being wealthy. I don't like paying them, and have no way to do an ROI, but I just know that they have saved me, or my heirs 500 to 1 on what I've "invested in" them since I turned 21.

In short, I'd rather pay my "parasitic" attorneys a little bit in order to keep the considerably more expensive parasites at bay.
 
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I haven't found it too hard to avoid parasitic attorneys. It's harder, IMO, though to know whether I have a good attorney, CPA, etc. or other professional.

Two indicators I look for in a new relationship are: "I don't know." and "I screwed up." If I hear those I have slightly increased confidence that I have hired a truth-teller.
 
My point was that many here view attorneys as parasites with little, to no sense of fiduciary responsibility.
Fair point. As a former parasite (not in estate planning), I sought out estate planning attorneys I knew personally, and I know they well understand their fiduciary responsibility and take it seriously. My wife and I fall in the wealth range you noted, but our situation is apparently otherwise straightforward enough that neither of those attorneys suggested a trust for us. We had the opportunity to review drafts of all the documents, ask questions, and suggest changes, and when we met personally with the attorney to sign the documents he went over every single paragraph with us (which made even my eyes glaze over). We were there for a couple of hours. Good attorneys are out there. I wish it were easier to find them.
 
Personally, I view attorneys (and tax accountants) as just a necessary evil of being wealthy. I don't like paying them, and have no way to do an ROI, but I just know that they have saved me, or my heirs 500 to 1 on what I've "invested in" them since I turned 21.

Would you be willing to provide some tangible examples of this 500 to 1 return? My experience has been far, far, far lower than that so I am wondering what I might be missing.
 
Would you be willing to provide some tangible examples of this 500 to 1 return? My experience has been far, far, far lower than that so I am wondering what I might be missing.
Well, as I said, I really can't do a real ROI, but it's most often about ensuring things don't happen. The thing is, as my lawyers always say "anyone with ten bucks can sue you".

There's a lot of family resources on moms side that are sometimes more of a liability than a benefit in that regard. Thanks to dad, I have a different last name! There's a lot of predators out there but things can be put in place to mitigate a lot of it.

Estate plans and trusts, LLCs, etc insure that our heirs will get assets according to our wishes with minimal tax or delay. With no direct heirs, we decided against GST trusts. Not our problem.

My guy saved me from losing half my NW in a divorce from an 18 month marriage (the gold digger got $0) 40 years ago.

We also set up several trusts to protect my disabled brother in the event that both of us are not around. Between himself and what he'd get from us, he'd be a grifter's dream!
 
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I appreciate all of the replies. Obviously, different strokes for different folks. For us, with 85% of assets in financial accounts that have primary and contingent beneficiaries that will pass before wills or trusts are involved, I think I'll go with a simple will. In this state I can also put a contingent beneficiary on our house deed. There won't be much left for probate even if we die at the same time. We'll ask a family member to be our contingent executor and tell them to hire an estate attorney, CPA, realtor, and whatever else they need for the probate process.

Like Mercy Me, I have become totally frustrated with what attorney's charge and the conflicting statements they make while pushing trusts. I just can't see paying thousands of extra dollars for a trust in our case. Twenty years ago, trusts were for the super wealthy and everybody else got wills, or nothing if they had little assets.

To each their own. Thanks again for the feedback.
One piece of advice is make sure you have 1 bank account where the beneficiary is the estate. So the executor has some $$$ to pay all the bills that will be due while things are being distributed and even probated.
I'd suggest off the top of my head $20K.

While helping be executor of an estate where everything else was POD/TOD, finding this account was great as it provided $$ to pay bills for months until everything settled. Then distributed this account remainder according to the Will.
 
Our estate planning attorney arranged the trust to our specifications. It would be hard to start with another firm after spending $6100 but I wonder if it would be for the best. I know some people have an attorney as-co trustee along with a family member but we didn't see the need in our situation.
 

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