The number one thing people need to know is that trusts sound scarier than what they actually are. When people who are not familiar with trusts talk about trusts, they would think about the Rockefellers and the Carnegies or any of those dynasty families or big, super wealthy people. Most people then think they are not wealthy and they are not that kind of person so they would not need it.
The first point would be that trusts are not just for the super wealthy, they are for everybody.
My first involvement with a trust was when I was probably ten years old and my grandparents set one up. They were blue collar working class people who never went to college, and they were not wealthy people by any stretch of the imagination.
I just remember I got my birthday present which was a check from my grandmother, and instead of being from her name individually, it was her as trustee for the family trust. I told my mom because I thought the same thing as everyone else, that we were probably like the Kennedys and that we were super rich.
I told my mom that I just couldn’t wait to get our trust and I wanted to know when we would get to inherit everything and just live the lavish lifestyle. She laughed and told me we did not have any money and that I would not get anything out of that.
That was quite a while ago and I was young so I did not even quite grasp it, but that was basically when I saw that trusts really were for everybody and then obviously as I got older, got educated and became a lawyer, I got to see all the benefits of that.
The biggest thing is that trusts are not nearly as complicated or scary as people seem to think they are, they are just different and are something that people have generally never heard about.
Frankly, the probate process is just as confusing and complicated but people do not think about that because they understand the ‘will’. Sometimes my attorney friends and colleagues call me if someone died and they tell me they have been made the executor because they are the attorney, but they have no idea what they are doing, and although these are trained attorneys, they just do not understand it.
Probate is just as complicated as doing a trust, but people generally feel comfortable because they have heard these terms before and maybe their parents had a will, or their grandparents had a will and then maybe their uncle took care of things. Everybody is just comfortable with the concept.
Probate is just as confusing as a trust, and in fact, it is probably more confusing because when the person shows up at the probate court, the court would not be allowed to tell the person what to do because they would not want to give legal advice and get in trouble.
People also tend to not realize the power of the trust and what they could do with it unless they understood how it worked, and they could see that it was not nearly as complicated. They could harness the power of the trust and use it for their benefit for what they could achieve with that and the benefits they could achieve during their lifetime and then for their spouse or for their next generations to come. A trust is just so much more powerful, so much better and it would give so many more options than just having a will.
Are There Any Loose Ends When Someone With A Living Trust Dies?
It could not actually be called loose ends, but yes, it would take time to settle things because the estate would have to be administered and things would have to be dealt with. The trust would own these things, so everything would have to proceed in the direction that the rules of the trust instructed them to go in.
The person would have to complete the plan because part of the planning or the motivation in a trust is to ultimately have a plan for the ultimate disposition of everything they had, whether that stayed in trust, got moved to a different trust for the wife or kids or whether it was just given to beneficiaries outright. This would be called administration, and it would be one of the components of a trust.
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