Asset Planning, Inc Blog

The latest from the team.

The Importance of Choosing the Right Trustee

 

More and more people are realizing the importance of setting up a trust for their estate. Having a trust in place insures that your wishes for your estate are carried out on your terms if you become unable to care for yourself or pass away. It also prevents your assets from going into probate after your death and saves a huge headache for your heirs. While having a trust in place is very important it is also very important who you name as the trustee.

There are a few different options when selecting a trustee. The most common scenario is that a married couple sets up a living trust where they are both listed as trustees and they list a child or family member to become the successor trustee. In the case that one spouse passes before the other the living spouse will become the sole trustee until they are incapable of caring for themselves or they pass away. At that point the successor trustee in charge of handling the estate duties.

The responsibilities of managing an estate are many and can be daunting to someone who lacks experience in these types of situations. When choosing your trustee you should choose someone who is (a) willing to dedicate the time and energy to run the estate (b) responsible and possesses good judgement and (c) someone who can be objective when following the instructions set up in the trust. It may seem like the natural choice to choose your child or a family member to act in this role but it may not be the best choice depending on the complexity of your estate and their abilities.

In the case where a person is unsure of who to name as a trustee an estate attorney will usually suggest that a bank be set up as the trustee to carry out the responsibilities of the trust. This is called a corporate trustee. This seems like a good idea because a bank has experience with handling trusts and wealth management. But this is not always the best choice either. When the duties of a trustee are needed the bank will take over the trust, move your assets from whatever accounts you have them set up in now to investments of their choosing and will take over the estate. They will follow the instructions in the estate as wished but it may leave your family without the feeling of a personal connection since they may not have worked with that bank before or know the person handling the assets.

Did you know that you have another option that will help ease the burden on your loved ones by running the estate themselves? There is something called an administrative trustee. In a lot of cases we see a child take over the duties of the estate and get overwhelmed with the process. They may be doing it free of charge but in the long run trying to take care of everything on their own ends up costing more financially and emotionally. An administrative trustee is a company that is set up to handle all of the time consuming paperwork and filing responsibilities of the estate. They do not make any decisions as far as wealth management is concerned. That is still the responsibility of the trustee and their financial advisor. Yes, there is a fee to have an administrative trustee but it can outweigh the stress and headaches that come along with trying to do everything yourself.

The best thing to do is have an open discussion with your family, estate attorney and financial advisor. Make your goals and wishes for the estate clear and set up the trustee that you think will be the best fit for your personal situation. By doing this you will have the peace of mind knowing that your wishes will be followed and that your family will be taken care of in the way that you want.

Continue reading
  2226 Hits

Top Reasons to Set Up a Living Trust

 

Even if you are not super wealthy there are many benefits to setting up a living trust. A living trust is a document set up by an estate attorney to help you manage your assets, including property while you are alive and names a trustee to act on your behalf to carry out your instructions, if you become incapable of caring for yourself or pass away. Here are a few of the top reasons why you should set up a trust.

Avoids Probate- A trust allows your heirs to bypass probate which can be a lengthy process and your estate can be charged up to 5% in probate fees. This can mean a substantial savings in time, legal fees and paperwork.

Protection Against Disputes- Unfortunately there may be someone who is unhappy with the way you have instructed to have your assets distributed. A trust is harder to contest than a will is because they have to be able to prove that you were under undue pressure or influence in setting up the trust which is nearly impossible.

Flexibility- Trusts offer more flexibility in how you can distribute the funds. In the case where you may have minor children you can specify how the money is spent and when they would have full rights to the funds.

Avoids Estate Taxes- A trust can provide a way to avoid or reduce estate taxes because assets and property placed into a trust are not subject to these taxes.

Minimizes Family Conflicts- You can specifically detail exact items and monetary distributions to be given to each beneficiary. This helps to curtail any of the “who gets what” problems that may arise with family members.

Privacy- Trusts, unlike wills, are private because they do not go through probate. This means your assets and who you leave them to are kept private.

Continue reading
  2202 Hits
Tags:

Search Blogs Module

Wait a minute, while we are rendering the calendar
earthquake app asset Planning EEChecklist-Kits.pdf stockpilingchecklist.pdf policy tax filing deadlines donation counts Joey Gonzales non-prescripstion sunglasses 4 pm -8pm payments spam phone interest rates student loans vacation credit card company Supplemental Security Income Part B cell phones April 11 portal blog post summer prescription eyeglasses self-help topics Auto insurance emergency kit Labor Day tax season toilet paper https ://seekingalpha tax returns information July 4 cell phone provider Shred paperwork 23 andme Victor Dergunov fun atmosphere CERTIFIED FINANCIAL PLANNER exam Medicare Fox News story cell phone SIM swap scam CA FTB July 6 cell phone carriers years April 18 2017. Notary Public tax deadline retirement accounts driver license investment statements scams opt-out increase memorial Day weekend home mortgages account numbers VOIP landline phones October 1 2020. Orange County Superior Court 2017 IRA contributions email notifications birth certificates items FEMA website Kraig Mathias check lists clone counterfeits house sitter Part D premiums . ID card pet tax records insurance policy phishing scams cell phone service provider official certification CFP ® Kiplinger Letter Mobile Banking Security Tips media accounts paperwork clutter Medicare question privacy settings FSA family members stimulus package 900 number Medicare Part B settlement options Federal Trade Commission website fun facts home security IRS September 8 markets Economic Security Medicare Part B premiums Coronavirus Aid vision screening jury duty Social Security Legal robocalls 20 year anniversary health care services National Ice Cream month home integral member banking ice cream holidays approach market turmoil card reader parking spots July weekend rescue organizations Wells Fargo customers Asset Planning illiegal robocallers information Facebook emergency folder news coverage trust September 30 2020. Social Security Administration spring cleaning retirement Medicare plan spread TD Ameritrade pet donation drive records January 10 DNA test kits ice cream event identity theft contribution limit COVID -19 virus July 3 rd coronavirus Orange County pet industry credit monitoring service Open Enrollment wells Fargo donation items fees pets gap insurance Financial Planning Magazine borrowing money September 9 life saver privacy notices web address credit score company team members operations manager identity thieves pet supplies D premiums partner /owner credit card fraud chip-enabled EMV cards Expired medications credit freeze water … retirement plans Two-Step Verification Roth IRA debt home break-ins Affordable Care Act documents drive /usb April 15 retirement planning checklists notary services relief efforts home emergency kit California Lions Friends phone companies phone “ skimmer ”. estate Medicare Advantage estate planning direction Flexible Spending Account insurance policies earnings fallout consumer spending Facebook profile client portal 401K text messages Amazon stock pile car loans breach hurricane Dorian Erin Nelsen IRA accounts trustee clients business hours home emergency preparedness kits president Trump disaster areas credit cards health care costs emergency kits Ice Cream Social phishing sites executive order https :// 2017 TD Ameritrade National LINC Conference 70 1/2. Brexit vote June 29 clients show support interest app estate planning Wells Fargo employees Treasury Department money 2017 Equifax breach padlock Healthcare flash drive Independence Day Charles Schwab 2018 IRA contributions IRS deadline February 14 offering insurance assets Retirement Contribution Limits people medications paper records bottom line tax deadlines Open House CARES Act Puerto Rico cell phone carriers offer