Will vs Trust?

DutchmanAZ · December 5th, 2006, 03:19 PM

My wife and I need to get either a will or a trust completed. I've heard so many horror stories about wills/trusts that are tied to whatever attorney you use I'm afraid I'll make a mistake. Anyone got any pointers?
Any "gotcha's" out there we should be aware of?

DutchmanAZ · December 5th, 2006, 09:59 PM

Come on...no one has a clue?

I feel better somehow...

Linderbee · December 5th, 2006, 10:08 PM

wait for the rest of the crew to come on tomorrow--I'm sure someone will have some input--it just won't be me!!

I'm gonna live forever!

jefftheshark · December 6th, 2006, 10:11 AM

I'll give it a quick shot.

It all depends on your situation in regards to asset allocations and estate tax issues. Basically, the more assets and people you want to distribute them to, the more complicated it gets.

My wife is a CPA and we interviewed two different atty's before selecting one. We went into the meetings with a complete list of assets and had previously discussed all the tough stuff like, "who raises the kids if both us die at the same time" and "how old will the kids be before they get their hands on the money".

Got to run to meeting. Let me know if this answers the basic question, or if you need something more.

Good Luck!

The Shark

jw7 · December 6th, 2006, 07:34 PM

I went thru this last year. If you have minor children and/or a house you should definately do this.

A will is a document that gives your intent on who you want to take care of your minor children, manage your affairs, whether you want to be cremated or buried, who receives family heirlooms and whatnot.

A living will leaves your last wishes if you become incapacitated on how long you want to be kept on life support, etc... who makes the decision to pull the plug, etc...

A trust is a document and a vehicle for "pooling" your assets, so that a trustee (or a list of trustees in order of succession that you designate) can manage your entire estate if you pass. For example, I don't own my house - my house is owned by the "revocable living trust of jw7, jw7 trustee". If I get hit by a bus tomorrow, my trust is the benificiary of my life insurance, not a specific person.

The main purpose of the trust is to avoid probate between possible default inheritors of the estate if you don't specify a succession of trustees.

So the minimum things I would ask for is for them to prepare:

A last will and testament
Power of attorney
A living will
A revocable living trust

If you find a firm or attorney to prepare this, the process is to fill out boilerplate documents. Then you get them notarized, fund your trust (e.g. put your house in your trust's name) and give copies of your wills and trust to your succession of trustees.

I'm sure I screwed up on a couple of lawyer details, but I hope that helps a bit.

DutchmanAZ · December 7th, 2006, 10:44 AM

Thanks. I appreciate the info!

Absolute Zero · December 7th, 2006, 03:05 PM

The selling point of the trust is that it allows your beneficiaries to avoid probate costs after you are dead. Everything is transfered into a trust while you are still alive, ie. bank accounts, deeds, car titles etc, so there is more red tape involved and more expense.

A will may need to be probated to get your assets transferred after your death. That could mean hiring an attorney, paying court costs, etc. For a small estate, this may not be a big deal. A lot of people don't care about these costs since they will be dead at the time they are incurred anyway!

I don't practice law in Arizona, so state laws there may provide additional differences. In general though, either a will or a trust can name gaurdians for your kids and include trust provisions so that someone can provide for them if they are still minors.