Difference between will and trust?

[Susie]

Oct 30, 2014 14:17:05 GMT -5 sxia said:

My neighbor, who is a paralegal says I should have a trust because we have kids and a house in CA. (This is what she does all day.)

 to your neighbor.  That's a pretty big oversimplification.  It might be true in some instances, and it might not be in others.  Please don't actually take advice on that basis!  (I wouldn't use the general $1M+ guideline either, necessarily.)  The fact that she's tossing around random advice that lightly is a big red flag that she doesn't really know the implications of what she's talking about.  Even if she preps the paperwork all day, she probably does not understand all the reasons why you'd choose one or the other.

If it's a question you're thinking about, make an appointment with an estate planning attorney and have them explain the differences to you, and what that could mean for your circumstances.  They'll help you pick what's right for your needs.  I know it's an obnoxious answer, but I don't want to try to characterize them or how they work on the interweb, it's too slippery a slope.

[SJ]

What? Your paralegal neighbor was going to draw up complex legal documents for free? After offering oversimplified "advice"? I don't think so.

[sjh722]

Noooooo. Bad idea. Do not let your neighbor do that.

You need an estate planning attorney. I think it's fairly reasonable to have that all set up.

[sjh722]

Oct 30, 2014 14:59:29 GMT -5 sxia said:

She works for a law office and she was going to get them done there.

Right, but she does not have a law license and can't advise you on all the ins and outs and potential ramifications of your decisions.

Don't be short sighted. Speak to an actual attorney. 

[Mushe]

Oct 30, 2014 14:59:29 GMT -5 sxia said:

She works for a law office and she was going to get them done there.

The law office she works for is willing to take on that kind of liability for free?  

I agree with the PPs - meet with an estate attorney and make an informed plan.

[Susie]

Oct 30, 2014 14:42:01 GMT -5 sxia said:

The neighbor was going to do it for free for me.
On the other hand, I was thinking of just doing it through the website US legal forms.
www.uslegalforms.com/dave/

No, PLEASE DO NOT DO THAT!  Either of those things, actually.

I am more   at your neighbor's offer than the suggestion of doing it online, because she should know better.  That would almost assuredly amount to unlicensed practice of law.  And, if her idea of the difference between the two is that you do one if you have assets of >$1M and the other if you're at <$1M (and even if it's a little more sophisticated than that), you would be getting terrible advice.

You know that you don't know the difference or which is best for you.  So why would you rely on someone who doesn't seem to either, and isn't trained or licensed to help?  You won't be here to explain what you meant in a shoddily drafted will or trust.  It needs to be done right.

In my practice I regularly see trademark applications that get horribly botched by online filers, and they're a shitshow to fix.  They end up costing more than it would've cost to pay me to file it right the first time.  And that's with the benefit of the filer telling me exactly what they meant!  Estate planning is a lot more complicated, so you can extrapolate a little here.  Please see an attorney!  

[v]

 at your neighbor

And definitely do not do this yourself/online/etc.  That's a really, really bad idea too.

[SJ]

Oct 30, 2014 14:59:29 GMT -5 sxia said:

She works for a law office and she was going to get them done there.

OK I realize that, but if my assistant was going around telling her neighbors I would manage their portfolios & recommend stocks to them for free, it would be a huge issue.

[aurademystere]

Oct 30, 2014 14:42:01 GMT -5 sxia said:

The neighbor was going to do it for free for me.
On the other hand, I was thinking of just doing it through the website US legal forms.
www.uslegalforms.com/dave/

Holy unauthorized practice of law, Batman!

[moolarkey]

My parents put everything they could in a joint revocable trust (the only thing not in it was my mom's IRA). When dad died mom immediately had sole ownership of everything, everything automatically transferred to a sole revocable trust. When she died everything split in to 2 trusts - one for my brother and one for me. We had to probate a couple small things that hadn't gotten put in to the trust. I can't remember what except that one thing was a canoe. I think it was a total of $1800 or something that we probated. I can't tell you how easy this made things for my brother and I. My parents worked with a lawyer to set this up but my mom did the legwork. She got the title to all the vehicles (cars, trucks, motorhome, etc), real estate, checking accounts, savings accounts, investments. etc. It cost about $1200 or $1500 for the attorney. When my mom died I was the executor and I probably could have muddled through all by myself but I was more comfortable working with the same attorney. I really just used her to check in and be sure I wasn't forgetting to do something. I found an old insurance policy my grandparents had bought for my mom when she was a kid. I figured it wasn't worth anything, she encouraged me to send it in - it was $5,000. I think my brother and I paid her $1200 or $1500 and it was worth it to me.

[tripleshot]

I agree with the above advice. Also, we were told minors can't inherit life insurance money (and maybe retirement account money too). So to ensure all our insurance money, retirement, savings, etcetera would be available to DS if something happened, we each set up individual revokable trusts. The trust allows the guardian and/or trustee to access the money to care for DS and pay for his schooling. We also specified how much money he gets as an adult and when.