Information Center - Your Estate Plan

LIVING TRUSTS AND WILLS

As knowledge is becoming more available to everyone through advances in technology, people are gaining access to information which had been reserved for the wealthy. Benefits of a Living Trust were also cost prohibitive to the general population and therefore the benefits of a Living Trust were lost to them and their heirs. This is not so any more and our software opens the door for all to create their own Living Trust and Estate Planning documents.

You and your heirs can avoid the cost and the time delays of probate and the court system. A Living Trust is an effective method to avoid going to court not only for your heirs after your death, but also during your lifetime, in the event you become incapacitated. Learn more about Living Trusts, Wills, and the probate process and know that with our software you can create your own Estate Plan.

INFORMATION CENTER

Definition of Estate

Your estate is simply everything you own.

Estate Plan

The Estate Plan created within our software is a series of documents including a Trust, Pour-Over Wills and Durable Powers of Attorney for financial issues which help you plan your life and ensure that your heirs get your assets in the manner your decide. The central document in an estate plan is the trust.

Living Trust

A living trust is a legal document created by you during your lifetime. Just like a will, a living trust spells out exactly what your desires are with regard to your assets, you dependents, and your heirs. However, it allows your heirs the opportunity to avoid the costly and time-consuming process of probate court. If you set up a living trust (the central document in My Trust and Will software) and transfer title to all your assets to the trust, then upon your death, rather than going to probate court, your chosen Successor Trustee will merely step into your shoes as trustee of your trust and with your death certificate and a copy of the trust will have the authority to distribute your assets as you have directed, without the involvement and public scrutiny of the probate court.

Probate Court

Probate court is the court assigned to review wills and decide the heirs and guardians for dependents of people who die without having created a will or another testamentary document. Probate decisions for people who die intestate (without a will or trust) are made according to legal statues, not your wishes. If you have not assigned guardians for your children, the court will. If you have not assigned heirs and percentages to such heirs, the court will. Probate is required if the value of your probate estate exceeds a relatively low amount, which varies from state to state. Probate can last longer than two years and may be delayed by factors beyond the control of your beneficiaries, like overcrowded court and attorney schedules. The probate process can cost up to 10% of your estate’s value. If the beneficiaries do not agree with one another, probate court also provides an arena for them to contend one with another.

A living trust helps you and your heirs to avoid probate and within the trust created through My Trust and Will software there is a forfeiture clause which declares that if a child or beneficiary sues the trust without cause, then such child or beneficiary is disinherited. This provides an incentive for your children and beneficiaries to peacefully distribute the assets of your estate in a peaceful manner and as you have outlined.

Transferring Property Into Your Trust

When you have completed and signed your trust it is essential that you “Fund” your trust. Funding a trust means transferring the possessions you own into your trust. When you create your trust with My Trust and Will software you will also get a “To Do List.” On this list it will tell you to:

  • Record Quitclaim deeds transferring any and all real estate from you as an individual to you as trustee of your trust.
  • Change the name on any bank and credit union accounts to the name of the Trust.
  • Change the name on any stocks and bonds that you own in your individual name to the name of the trust.
  • Change the name of any ownership certificates you have in a limited liability company, a corporation or a limited partnership to the name of your trust.
  • Insurance policies of substance ($50,000 or higher) should change the beneficiary to the trust.
  • Change any other titled property such as vehicles, motor homes, boats etc. to you as trustee of the trust. Often this is as simple as adding the word “Trustee” after your name on the title (check with your local DMV).

This is an important step. If you leave items out of the name of the trust, then your heirs may have to go to probate court to take possession of such items.

Pour-Over Will

Wills allow you to name guardians for your children under the age of 18 as well as assign your assets. A will alone is an invitation to probate court. In order to avoid probate the My Trust and Will software creates a living trust and the wills within the software are pour-over wills which direct that all assets are poured into the trust and through the trust the assets are distributed to the beneficiaries (heirs).

Durable Power of Attorney

Durable Power of Attorney for financial issues is a legal document that gives someone you choose (your Agent) the power to act in your place. In case you ever become injured in an accident or mentally incapacitated your Agent has the authority to pay your bills and help that you do not default on any of your payments. This document is included in the My Trust and Will software.

Health Care Power of Attorney

Health Care Power of Attorney, often called a Health Care Directive is a legal document that gives someone you choose (your Agent) the power to act in your place for health decisions. In case you ever become injured in an accident or mentally incapacitated your Agent has the authority make decisions and to speak to the doctors on your behalf. This document is NOT included in the My Trust and Will software and varies from state to state. It is an important document and we recommend that you search online for your jurisdiction and download and sign this document and add it to your Estate Plan.

FREQUENTLY ASKED QUESTIONS

What if I don't create a trust or will?

If you don’t create a testamentary document then when you die the state, through the probate courts, will decide according to state statues who will be guardians for your children (if needed) and who will be the heirs of your estate (everything you own).

What if I only make a will and not a trust?

If you only create a will, then your heirs will be forced to go to probate court in order to change title on any of your assets. A trust is a document which can hold title to your assets and thereby transfer such assets to your beneficiaries without the need for probate court.

Can a Living Trust protect my assets from catastrophic medical expenses or creditors?

No. A Living Trust cannot protect your assets from creditors or catastrophic medical expenses. If you are concerned about this we recommend speaking with a licensed attorney.

Do I need an attorney to create a Living Trust?

No. You do not need an attorney to create a living trust. You can create it on your own or with the help of software like My Trust and Will. If you have questions you cannot answer on your own or if you think your spouse or children will challenge your trust, we suggest you speak with a licensed attorney.

When signing my documents do I need a notary?

Yes, you will need witnesses and a notary. Most banks and credit unions provide notary services.

What is the difference between a trust and a will?

A will is a document which you create which expresses your will concerning your dependents (children) and the distribution of your assets to your beneficiaries (children and others you may choose to list as heirs).

A trust also allows for the distribution of your assets much like a will, however it is an entity which can hold property and therefore, if you assign all your possessions to your trust, your heirs will avoid the need for the probate courts and your assets will be easily distributed to your heirs in a private manner.

The My Trust and Will software provides pour-over wills which can name guardians and pour the remaining assets into your trust, thereby avoiding probate.

Do I need to keep separate records for my trust?

No. When you set up your trust through My Trust and Will software, you are the trustee and you need not create separate records for your personal finances and the finances of the trust.

Are there any limits to the number of beneficiaries I can name?

No. You can distribute your assets to as many people or organizations as you desire.

Can I create a trust with my spouse?

Yes. You can create a trust as a single person or as a married couple.