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Gentlemen:
I need some advice from you guys again.It is time to get my legal affairs in order.I am not that old yet but this needs to be taken care of.

I live in California.
Our home is free and clear.
All vehicles free and clear.
No minor children living at home.
No consumer debt, just the normal utilities and food.
No credit card debt.
Both of us are in good health.
I work 6 days per month (just for pocket cash).
All investments are currently in C.D's. (A fair amount by my standards).
All investment income is reinvested and not used.
No other properties.

Do I need a Will or a Trust? A will sure sounds a lot easier but I want to do the right thing and not worry about this matter anymore.
If a trust is the right way to go,does anyone have any experience with Legal Zoom or something similiar?
I hope I havent gone over the line with this question on a fishing board but you have always been good enough to help me in the past.

Any input out there is appreciated.

Thank you,
Tom
 

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Anytime real property is concerned you need a trust to sidestep probate. A will is good to designate what you want to go to whom.

The fees you pay an estate attorney are money's well spent, and a lot more cheaper than after you die and you estate goes into probate.
 

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Get an attorney that specialized in estate planning. Be honest, ask questions and if the answers are not clear, go to someone else. If the answers are clear and you have confidence in them, just do what they recommend.

A trust that is messed up can be a pretty good pain, if you decide you need one, make sure you have someone competent put it together, and remember, you need to keep it up to date.

Nice thing about CDs is that you can just list who you want as the beneficiary on the account and the money goes to them when you die with or without a will or trust.
 

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You might well need both.

Both are legal documents with potentially huge import. A trust is a private document that directs the trustee on how to handle assets placed inside of it. It does not go through the probate process.

A will is also a set of instructions, in this case to an executor, about how to handle the assets of a deceased person that are not already disposed of in a trust or otherwise. It does go through the probate process and in doing so becomes a public document (anyone can see it), and is probably more susceptible to challange.

They each have their purpose. If you own a home free and clear, and also have a fair amount of other property, you will probably want both, for tax purposes if nothing else. The reason is that every person is allowed to pass on a certain amount of assets to anyone else tax free--this is an amount that due to the crazy acts of the President and Congress changes from year to year. After that amount is reached, the remainder is taxable if you leave it to anyone other than your spouse--you can leave an unlimited amount to a spouse tax free.

So typically, a trust will be formed and is funded with assets equal the amount that one can pass on tax free. Any assets left over is left to the spouse, which is also tax free. The trust assets typically are used to support the surviving spouse, but that is not necessary--it can be used for anything. When the second spouse dies, (s)he then leaves his/her own personal exemption amount to anyone else tax free, and anything beyond that exemption amount is taxed.

If you are fortunate enough to have enough money that the double exemption does not allow you to pass on all your money tax free, there are other techniques that you can use to pass on more money in a tax advanataged way (annual gifts, QTIP trusts, Family Limited Partnerships, etc.)

As you see, this can get complicated. The above advice is right--see an expereienced estate planning attorney. It could also get pricey, but it would be money well spent.

BTW, a first step is to take an inventory of your assets, and consider what you want to happen to them when you and/or your wife dies. This will help determine what sort of planning is appropriate, but more importantly, forces you to think about the whole subject. Saving on taxes is very important, but not as important as making sure that your life's accumulations pass on in the way that you want them too and in the way that does the most good.
 

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The AARP Magazine of November/December 2007 (pg.40) has an outstanding article on Wills versus Trusts.

This article will answer your question without bias, and from what you listed as an estate and status, it appears that you only need a will.

Don't listen to most promoters of Trusts because most of them are trying to get to you financially.

Go to the library and get a copy of the AARP Magazine and let it guide you to the solution that suits you best.

I rather listen to AARP's advise than that of guessers.


Neptune


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I am a CPA by trade but am not an estate specialist. I would say you need to quantify your goals first. Attornies are the most apt to push you towards trusts because they get paid to do so. I would first talk to a good tax accountant. Based on his/her advice, then find a good estate lawyer.

In my limited experience, trusts are good for folks trying to protect assets from creditors and from careless children. If your children are trustworthy (they won't blow the money as soon as they get it), then you might be good enough with a good will.

Knowing whether or not you will have a taxable estate is important. If you do, there are some simple trusts that can help including one called a Crummy (sp?) trust. This trust takes advantage of the annual gift exclusion. If properly structured and adminitered, you can significantly reduce your estate and still have the money go to the folks you want to get it. One catch is you have to be willing to give some money away. Hope this helps.
 

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I am a CPA. Not an expert but do deal with this stuff on occasion. Go to a good trust and estate attorney. You do want a trust. Even if you will not go over the threshholds to have your estate taxed, it is still important. If you do not have a will or trust the courts decide what happens to your estate. This can be disastrous(there are things besides estate taxes to consider). If you only have a will, things will be decided according to it through probate courts, at greater cost than if you have properly set up trusts in place, and take a lot longer to do. Probate costs on $1,000,000 are typically going to run well into five figures. With trusts-almost no cost. Costs to set everything up with a reputable estate attorney is probably $1,500-$2,500. Just dealt with a situation that would be described much like yours and the parents had passed away. The heirs were very greatful to the parents for having the will, trusts, and other documents in place. Made dealing with medical decisions easier, and settling the estate relatively quick, easy, and cost free-and the children still talk to each other. Time to get it done.

Good luck.
 

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And while you're at the lawyers, look at getting Durable Powers of Attorney for Health Care so that you and your wife can make health decisions for the other if one of you becomes incapacitated--hopefully you'll never need it, but having that Power of Attorney if needed can be vital if you do.
 

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I will echo what Brad said about the powers of attorney. I just redid my will and when I did it I also got a general power of attorney and a health care POA. These will be state specific.
 

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You need a trust. Yeah an attorney is going to charge you approx $2500 to do one, but that is a hell of a lot less than the fees your estate will pay in connection with a probate.

Bill
 

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a will will cost your estate about $10,000 in court fees and up to a year to finish probate...a trust is around $500 to $1000 to file and instant transfer to heirs....if your estate is over $500,000 in net worth or you want the kids/heirs to have an easy way to go with their inheritance...do a trust..

This post edited by Long Beach Bob 06/05/2008
 
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