Annuities?

[M59]

You need to get the proper paperwork from who is handling the 401K to sign off on listing your trust as the beneficiary. You most likely have your wife or someone else significant to you listed as the primary beneficiary.

End of day, anything you or your wife have in any assets should have the trust listed as a beneficiary as well (bank accounts, CD's, other investments), unless someone else who isn't listed in the trust as the primary executor is listed at the primary beneficiary in other capital assets.

In my fathers case, since my mom died, he listed me as a primary in their (my parents) family trust and took my mom off the trust (he updated it when he moved to NC, which was a little bit of a hassle due to some variances in different state laws).

If everything is listed in you and your wife's name and not the estate, it goes without saying that if either of you two are listed as an executor in the trust and one of you dies, any capital assets will inevitably go to the other via the trust, but by listing the trust as a beneficiary, this makes it painless and no questions asked.

I'm not a lawyer, but this is what our estate attorney told us.

Even my sons whole life insurance policy is being turned over to the family trust via beneficiary (son is listed as an executor, but not for another couple of decades to see how he plays out "life wise" now that he's 18).

Seems to be a lot of work to keep the legal system out when you die LOL

Thing is, my dad wasn't a wealthy man monetarily wise, but with him keeping his trust updated with no will, transferring what he had in his life to me was absolutely painless. You don't have to be rich to have a estate, but I will tell your our lawyer costs us $2,500, but to us for what we have worked for and now own, that money was well worth spending.

Never think about dying unexpectedly, but it can happen.

Sigarms,

I would be careful with using only a Trust instead of a Will and Trust(s). A will is a catchall document that describes to the probate court what the various estate holdings are and might ever be and how to transfer the holdings in any of a number of events including incapacitation. Wills are crafted according to state of residency and should be periodically updated as state law changes. Trusts tend to be holders of very specific assets and come in both revocable and irrevocable and, I believe, apply only upon death of Trustor ( Trust creator ) OR at a pre defined time within the Trust. for example. I have set up Irrevocable Trusts for several nephews and they can see trust contents but can not access contents until they turn 55 years of age.

An estate attorney is the best person for reviewing a person's present and expected future estate and then providing guidance on how best to protect the estate from government taxes, discretion, delays, etc and limiting the ability of any party from contesting the assets being transferred along with removing assets from public view.

The above may be even more important now that a number of states are considering wealth taxes, where the estate is looking for total assets both inside their state and outside their state. Probably illegal is contested in courts BUT never-the-less a possibility than could become extremely painful.

It is painful to work hard for many years all while paying income taxes and then get taxed again. That is why Money Walks from some states to other states.

 

[Snobdds]

Vanguard Advisory service will generally recommend Total Market index and bond funds over the less diverse S&P 500 or such. Also a mix of domestic and international.

What does Vanguard charge to say this?

If the answer is anything over $0...you are working for them.

 

[Sigarms]

Sigarms,

I would be careful with using only a Trust instead of a Will and Trust(s). A will is a catchall document that describes to the probate court what the various estate holdings are and might ever be and how to transfer the holdings in any of a number of events including incapacitation. Wills are crafted according to state of residency and should be periodically updated as state law changes. Trusts tend to be holders of very specific assets and come in both revocable and irrevocable and, I believe, apply only upon death of Trustor ( Trust creator ) OR at a pre defined time within the Trust. for example. I have set up Irrevocable Trusts for several nephews and they can see trust contents but can not access contents until they turn 55 years of age.

An estate attorney is the best person for reviewing a person's present and expected future estate and then providing guidance on how best to protect the estate from government taxes, discretion, delays, etc and limiting the ability of any party from contesting the assets being transferred along with removing assets from public view.

The above may be even more important now that a number of states are considering wealth taxes, where the estate is looking for total assets both inside their state and outside their state. Probably illegal is contested in courts BUT never-the-less a possibility than could become extremely painful.

It is painful to work hard for many years all while paying income taxes and then get taxed again. That is why Money Walks from some states to other states.

Thank you for the advice. Sounds like you have experiences in this matter.

We actually do have a will along with a Trust, but at this moment in time, basically the kid gets everything until a certain age if that makes sense.

My only point to going into trusts per this thread is that IMO everyone should look at having one.

I just know with my father and mother, they started a family trust back when I was in my early 20's and never thought anything of it nor did I really care (being single and traveling / working), but now I can see some distinct advantages 30 years later having a family of our own and actually building assets over time.

 

[buckeyefarmer]

My father got stuck as the executor selling the family home (the house my grandparents bought in the 1930's when they came off the boat.

No will, no estate, unpaid taxes with a bunch of my fathers siblings still alive.

Very long story short, my father was "disinherited" by one sister and her 3 daughters because that aunt (who was the oldest sibling still alive at the time) thought that she being the oldest, should get the entire house, kit and kabuddle no questions asked.

Funny thing was the house was only worth only about 70K (with 15K in unpaid taxes) and she threw her relationship with her brother (my dad) out the window because my father followed what the state law laid out on how to split the house for everyone who was alive.

My dad died last year, but he kept the paperwork and what was involved in dealing with my aunt. I had to read it. Talk about a PITA.

Someone on my cousins fathers side tried to become executor of my cousins estate, his own sister protested because of job he did as executor of their parents estate. You still gotta follow the law.

I persuaded my mom and dad to set up wills and trusts years ago. Now it’s time for me to practice what I preach.

 

[turbo36]

Yes. The huge benefit is not paying WallSteet for management fees. The fees kill a person over the a person's investment lifecycle.

Never forget these charts...

I am 67 years old, maybe I’ll live another 20 years. I won’t come close to spending the money that I have now, why would I be interested in more money? At this point in my life, a severe financial market downturn would hurt me more than a reduced return. For me a 4% tax free muni is as good an investment as I could get.

 

[M59]

Thank you for the advice. Sounds like you have experiences in this matter.

We actually do have a will along with a Trust, but at this moment in time, basically the kid gets everything until a certain age if that makes sense.

My only point to going into trusts per this thread is that IMO everyone should look at having one.

I just know with my father and mother, they started a family trust back when I was in my early 20's and never thought anything of it nor did I really care (being single and traveling / working), but now I can see some distinct advantages 30 years later having a family of our own and actually building assets over time.

Sigarms,

Bottom line. A really good Estate Law attorney is worth their weight in Rhodium ( currently $12,000 per troy ounce ).

Absolutely agree that Trusts are great tools. Trusts avoid probate entirely since they have a designated trustee already in place to act on your behalf. Trusts are also a great way to obfuscate holdings. For example. My wife and I purchased land via a Trust ( say the "27846 Trust" ) and the initial Trustee is a faithful attorney. The property gets recorded under the Trust's name. Generally the Trustee's name is not noted in land transfer records. Then the initial Trustee, my attorney, is removed and I name a new Trustee, one of my children. Voila. No one looking at public records has any idea who owns the land since the actual Trust document is never recorded in the public land transfer records. At best the land transfer record may have a cover letter stating Attorney XYZ is Trustee of 27846 trust.

What fun games can be played when you know the rules.

 

[RSKY]

Thanks, my cousins estate is in probate now. What a pain. $2500 is cheap compared to what lawyers will suck out of the estate in probate.

I don't understand. We settled two estates last year, my mother's and my father-in-law's, without a lawyer. Both had simple clearly written wills. Both were settled without a lawyer.

I understand that some families do not get along with each other but this was so simple.

RSKY

 

[turbo36]

I don't understand. We settled two estates last year, my mother's and my father-in-law's, without a lawyer. Both had simple clearly written wills. Both were settled without a lawyer.

I understand that some families do not get along with each other but this was so simple.

RSKY

My mother-in-law and father-in-law passed away within 12 hours of each other last year. They had wills and estate planning yet some items still had to be probated under Michigan law. Apparently some of the financial instruments ( IRA's and 401K's) required an "official" transfer by the administering institution upon death. My mother-in-law passed away first, my father-in-law 12 hours later, since my father-in-law did not have time to "officially" transfer everything to his name only, anything that was not transferred was probated. This was really forced on us by the financial institutions that were just covering their asses. It cost us a lot of lawyer fees.

 

[M59]

I don't understand. We settled two estates last year, my mother's and my father-in-law's, without a lawyer. Both had simple clearly written wills. Both were settled without a lawyer.

I understand that some families do not get along with each other but this was so simple.

RSKY

RSKY,

A lawyer is not required for Probate of the will, however, depending upon the family dynamics or complexity or quantity ( dollars or variety ) of assets held by the deceased, a lawyer may be beneficial in the Probate process. Always best when family is able to amicably settle an estate without involving a lawyer and associated expense. Downside of involving a lawyer in Probate process is some unethical lawyers milk the process by putting in inappropriate billable hours to enrich themselves at the expense of the estate. The estate executor has to be clear they won't tolerate this practice. Had some of unfortunate experieince with the latter.

 

[MossRoad]

RSKY,

A lawyer is not required for Probate of the will, however, depending upon the family dynamics or complexity or quantity ( dollars or variety ) of assets held by the deceased, a lawyer may be beneficial in the Probate process. Always best when family is able to amicably settle an estate without involving a lawyer and associated expense. Downside of involving a lawyer in Probate process is some unethical lawyers milk the process by putting in inappropriate billable hours to enrich themselves at the expense of the estate. The estate executor has to be clear they won't tolerate this practice. Had some of unfortunate experieince with the latter.

As I recall, my father's will had a contract with his lawyer who would settle the estate for a set fee. Nothing more, nothing less. That lawyer died before my father, and he didn't update his will to get a new lawyer. Fortunately, the lawyer that took over the deceased lawyer's practice honored the agreement. Unfortunately, he was inept, and it dragged out for a year. Didn't cost us anything more, but was slow as molasses.