are revocable trust only for the rich?...

[Dancing Fire]

do you have a trust account setup?

i was B. S.ing with my friends at the bar and i told them that my wife and i had a revocable trust account setup for our daughters just in case something happen to both of us.

i said...everybody should have a trust account.
they say...we aren't rich like you,trust/wills are only for the rich.
i said...no,we aren't rich,but just in case something happens to both of us then the kids don't needed to go through probate.

LUNCH TIME

 

[ForteKitty]

My grandparents have a trust set up for my mom, aunt, and two uncles. They said that inheritance makes people crazy, no matter how little. The trust makes it fair. Each kid gets 1/4.

 

[isaku5]

Everyone should have an up-to-date will and powers of attorney for both property and health. In addition, those who have young children (under the age of majority ) must name a guardian to take responsiblity if the parents die.

I'm not a fan of trusts unless hundred of thousands or millions of dollars are involved. Setting up and maintaining a trust costs a fair chunck.

I'd like a PS lawyer's take on this as I'm by no means an expert.

DF, stay out of the bars

 

[Jennifer W]

Good timing, DF! There's actually a really informative thread on this that Haven started a couple of days ago, discussing guardianship for minors.

Isaku, I have a trust for my daughter, with all our moveable and heritable property in it, and alternative trustees named if DH and I predecease her while she's a minor. We're by no means rich, but it protects her against changes in inheritance tax levels, relatives contesting our Wills, and the time and stress of having property disponed to her via a Will. As I mentioned in Haven's thread, naming a guardian for a child doesn't carry any legal certainty - the courts will appoint a guardian on the child welfare principle. All I could do is make my wishes known, and make financial arrangements that make it easier for the court to see that my choice would be the best choice,if you see what I mean. The cost of setting up the trust was not inconsiderable, but I did some of the work myself and it doesn't cost anything to maintain.

On a bit of a threadjack, I hope your husband is doing well.

 

[Dancing Fire]

Everyone should have an up-to-date will and powers of attorney for both property and health. In addition, those who have young children (under the age of majority ) must name a guardian to take responsiblity if the parents die.

I'm not a fan of trusts unless hundred of thousands or millions of dollars are involved. Setting up and maintaining a trust costs a fair chunck.
I'd like a PS lawyer's take on this as I'm by no means an expert.

DF, stay out of the bars

i have a bar exam every Friday night..

what do you mean by maintenance? .. as i understand it once you set up a trust all you needed to do is to fund the trust with what ever you decided to put into it.i.e.. like properties,bank accounts,IRAs,jewelry,etc...

 

[Jennifer W]

It depends on where you live and how much is in the Trust. IIRC, In the UK if it's over the threshold for inheritance tax, HMRC can charge a % every ten years (I think it's ten, ages since I looked at tax law)to compensate for that.

 

[JewelFreak]

In the U.S. a revocable trust is very smart, no matter how little money you have. They don't cost much to set up & enable you to avoid at least State estate tax. My mother had one -- she was very far from rich! As her executor, I was so grateful to her for the headaches it saved me.

It's easy to do -- when you make a will (or if you already have one), execute a living revocable trust which states that your will & everything in it, all your assets, belong to the trust. It is a legal entity that continues, no matter who started it or when. When you die, the trust continues under the Successor Trustee you named. You can then, via the will, still leave bequests to whomever you want. The trustee will then disburse stuff according to your will & then close the Trust. Right now Federal death taxes don't kick in till your estate is fairly substantial, but states are all different -- most of them start grabbing at a much lower amount than the Feds do. Since your assets belong legally to the Trust, when they are disbursed they are not part of an estate for death-tax purposes.

Trusts also avoid putting an estate through Probate, which can take years in places where courts are backed up, & cost a bundle.

If someone dies without a will, states generally take a much bigger bite in taxes than if there is a will. It's foolish not to have one -- who will take your kids? What about your house? On & on. So many families are split by fights over things or money -- put it in a will & it's done, no argument.

--- Laurie

 

[Dancing Fire]

In the U.S. a revocable trust is very smart, no matter how little money you have. They don't cost much to set up & enable you to avoid at least State estate tax. My mother had one -- she was very far from rich! As her executor, I was so grateful to her for the headaches it saved me.

It's easy to do -- when you make a will (or if you already have one), execute a living revocable trust which states that your will & everything in it, all your assets, belong to the trust. It is a legal entity that continues, no matter who started it or when. When you die, the trust continues under the Successor Trustee you named. You can then, via the will, still leave bequests to whomever you want. The trustee will then disburse stuff according to your will & then close the Trust. Right now Federal death taxes don't kick in till your estate is fairly substantial, but states are all different -- most of them start grabbing at a much lower amount than the Feds do. Since your assets belong legally to the Trust, when they are disbursed they are not part of an estate for death-tax purposes.

Trusts also avoid putting an estate through Probate, which can take years in places where courts are backed up, & cost a bundle.

If someone dies without a will, states generally take a much bigger bite in taxes than if there is a will. It's foolish not to have one -- who will take your kids? What about your house? On & on. So many families are split by fights over things or money -- put it in a will & it's done, no argument.

--- Laurie

JF...that's what my wife and i try to avoid just in case something happen to the both of us.

 

[megumic]

When someone sets up a trust, there is a trustee and one or more beneficiaries. The trustee is responsible for distributing the items of the trust and the beneficiaries get whatever is in the trust. The trustee could be a friend, or it could be the bank. The bank would charge fees, hence the maintenance a PP mentioned.

Trusts provide more protection than wills and do not have to go through probate court. It makes it easier to transfer on the death of the settlor (the person who creates the trust.)

 

[Missy]

When someone sets up a trust, there is a trustee and one or more beneficiaries. The trustee is responsible for distributing the items of the trust and the beneficiaries get whatever is in the trust. The trustee could be a friend, or it could be the bank. The bank would charge fees, hence the maintenance a PP mentioned.

Trusts provide more protection than wills and do not have to go through probate court. It makes it easier to transfer on the death of the settlor (the person who creates the trust.)

My dh and I set up a trust with my sister and his brother as our joint trustees. It was not difficult and we thought it important to do this. Any competent estate lawyer can draw this up for you.

 

[JewelFreak]

Right. There are also forms for it online -- different for each state, but once you establish the trust it does not have to be redone if you move to another state (except to change your address, of course). Instructions come with them for what you need to make it legal -- usually notarizing or witnesses or both. Cheaper than a lawyer if you want to save money. For anything complicated you should, of course, talk to an atty.

--- Laurie

 

[Hudson_Hawk]

We don't have one because we don't really have anything, but we will set one up for our children when we have a little more to protect like property. DH learned about trusts when he had to put his grandmother's estate in one while she was ill to protect it from his father who had drained her bank accounts.

 

[elrohwen]

My parents don't have a trust fund set up for me, but they do have a will and everything they have will go to me (I'm an only child) so I guess that's the same thing. I think it's most important to have a will if you have children so that they have somewhere to go if something should happen (even if there's not much money, a will can determine which relative/friend takes the kids). I'm assuming in the case of a child the guardian would be considered the "trustee".

 

[Hudson_Hawk]

My parents don't have a trust fund set up for me, but they do have a will and everything they have will go to me (I'm an only child) so I guess that's the same thing. I think it's most important to have a will if you have children so that they have somewhere to go if something should happen (even if there's not much money, a will can determine which relative/friend takes the kids). I'm assuming in the case of a child the guardian would be considered the "trustee".

I was talking about property, we have separate orders in place for guardianships, etc which are separate from trusts.

 

[isaku5]

Good timing, DF! There's actually a really informative thread on this that Haven started a couple of days ago, discussing guardianship for minors.

Isaku, I have a trust for my daughter, with all our moveable and heritable property in it, and alternative trustees named if DH and I predecease her while she's a minor. We're by no means rich, but it protects her against changes in inheritance tax levels, relatives contesting our Wills, and the time and stress of having property disponed to her via a Will. As I mentioned in Haven's thread, naming a guardian for a child doesn't carry any legal certainty - the courts will appoint a guardian on the child welfare principle. All I could do is make my wishes known, and make financial arrangements that make it easier for the court to see that my choice would be the best choice,if you see what I mean. The cost of setting up the trust was not inconsiderable, but I did some of the work myself and it doesn't cost anything to maintain.

On a bit of a threadjack, I hope your husband is doing well.

Thanks for setting me straight on the facts regarding trusts. I will read Haven's thread as well.

My DH is recovering more slowly than he'd like, but we were told at the outset that the healing will take time. Thanks for asking

 

[MichelleCarmen]

My grandparents have a trust set up for my mom, aunt, and two uncles. They said that inheritance makes people crazy, no matter how little. The trust makes it fair. Each kid gets 1/4.

Yep, the SMALLEST amounts turn people into nuts. In fact, this has happened in every situation I've witnessed with EVERY family member who's died. Even if some $ is lost in attorney fees, I do not a family member should ever be an executor of an estate (unless they are NOT listed in the will and had no chance of financial gain).

 

[MichelleCarmen]

My parents don't have a trust fund set up for me, but they do have a will and everything they have will go to me (I'm an only child) so I guess that's the same thing. I think it's most important to have a will if you have children so that they have somewhere to go if something should happen (even if there's not much money, a will can determine which relative/friend takes the kids). I'm assuming in the case of a child the guardian would be considered the "trustee".

I was talking about property, we have separate orders in place for guardianships, etc which are separate from trusts.

What happens if the property isn't wanted? We have both land and a house willed to us and we do NOT want some of it (some is owned free and clear and other is mortgaged). We do not want the mortgaged stuff. What happens then?

 

[Jennifer W]

Good timing, DF! There's actually a really informative thread on this that Haven started a couple of days ago, discussing guardianship for minors.

Isaku, I have a trust for my daughter, with all our moveable and heritable property in it, and alternative trustees named if DH and I predecease her while she's a minor. We're by no means rich, but it protects her against changes in inheritance tax levels, relatives contesting our Wills, and the time and stress of having property disponed to her via a Will. As I mentioned in Haven's thread, naming a guardian for a child doesn't carry any legal certainty - the courts will appoint a guardian on the child welfare principle. All I could do is make my wishes known, and make financial arrangements that make it easier for the court to see that my choice would be the best choice,if you see what I mean. The cost of setting up the trust was not inconsiderable, but I did some of the work myself and it doesn't cost anything to maintain.

On a bit of a threadjack, I hope your husband is doing well.

Thanks for setting me straight on the facts regarding trusts. I will read Haven's thread as well.

My DH is recovering more slowly than he'd like, but we were told at the outset that the healing will take time. Thanks for asking

Well, the good news there I suppose is that he is recovering. I hope you can both put this behind you very soon. Hugs.

***Apologies for threadjack!***

 

[elrohwen]

My parents don't have a trust fund set up for me, but they do have a will and everything they have will go to me (I'm an only child) so I guess that's the same thing. I think it's most important to have a will if you have children so that they have somewhere to go if something should happen (even if there's not much money, a will can determine which relative/friend takes the kids). I'm assuming in the case of a child the guardian would be considered the "trustee".

I was talking about property, we have separate orders in place for guardianships, etc which are separate from trusts.

I wasn't referring to your post - I didn't read the other responses before posting. Just referring to why wills and things are important for rich and poor, whether there's a "trust fund" or not.