Do I need a Trust if I already have a will?

In California, if the aggregate of non-beneficiary named, non jointly owned, or non Trust owned items, (think your home, autos, bank accounts, collectibles, etc) is more than $184,500 the assets will have to move through a probate court. Read more about probate here and the CA regs on inherited assets here: https://www.courts.ca.gov/8865.htm?rdeLocaleAttr=en

If you own a home in CA and it is not yet trust owned - you qualify for probate court, but this is not an admirable qualification. This is where the courts decide the validity of wills, among other things. The average time spent in probate (think “in limbo”) is 12-18 months, and your cost will vary, however according to one Trust Attorney I spoke with practicing in CA, on a $500,000 estate in probate, expect to pay about $25,000-$30,000 to move through the probate courts both for legal representation as well as the estate representative.

A common perceived downside to having a trust in place is the cost of establishing one. In the Bay Area of CA, expect to pay $2,500-$7,000, however know that this cost will cover a full estate plan. This means a trust, a pour over will, a medical directive and power(s) of attorney. You can also build your own through a guided trust completion on nolopress or legalzoom dot com. This secondary option is a few hundred dollars, yet it can be mired in difficulties. As my trust attorney referrals have mentioned; “Usually self written trusts contain so many errors in legality it creates a bigger problem than it solves.” So consider hiring a pro here, unless you feel knowledgeable in legalease - your estate is worth it. It’s much less expensive to plan ahead, as noted above.

A trust allows assets to avoid probate - think of this as a purgatory you don’t want your legacy to get dragged through. Usually, a simple living revocable trust alongside a pour over will is sufficient. However, for all planning purposes a power of atttorney and an advanced medical directive are key for a full estate plan. If you are in a coma - and unmarried - who will decide things for you? Or, if the event if you and your spouse are both unable to speak for yourselves, who is in charge? If you have an advanced medical directive, it creates ease and peace as that one person is whom you trust to speak for you - can, without disagreements and time delays in the medical facility you may find yourself in.

One of my favorite things about a Trust is the ability to control how wealth will be distributed for your next generation. I built my business with the phrase “building wealth” as my thesis and guiding statement. You can craft a plan that builds multi generational wealth with how you intend to distribute it, after you are no longer here. Truly creating longevity across the ages requires diligent yet simple planning. The place I most often see my client’s stuck in is in the choosing of a successor trustee or executor to manage your funds after you have passed. Remember this is changeable - Trusts can be amended ongoing, and should be with major life event changes or a falling out with who you chose 5 years earlier. And you can just list a hired professional as well, it does not need to be family. It actually usually goes much smoother if a professional is named - one outside of the familial triggers and grieving processes.

I work closely with a few Trust Atty’s, contact me to inquire more if you’d like to hire a professional. Or, feel free to reach out to them directly: https://ayoubdodson.com/contact-estate-planning-oakland-ca/

The use of trusts involves sometimes complex tax and legal rules and regulations. Consider the use of an estate planning professional to implement strategies that will best serve your specific needs. Legal services are not authorized nor supervised by Karena Schwenk or the Lincoln Investment Companies.