Author Topic: Will / Trust  (Read 3222 times)

aceyou

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Will / Trust
« on: July 18, 2015, 04:30:40 PM »
My wife and I have not set up a will/trust.  I know nothing about them other than we should probably have done it already.  We have a 3 year old son, and a 3 month old daughter.  Does the mustachian community have any advice other than to get one?

GizmoTX

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Re: Will / Trust
« Reply #1 on: July 18, 2015, 05:31:15 PM »
Start with your wills & powers of attorney for health & financial decisions -- both of you each need a set yesterday. This is a good article outlining the basics: http://thevirtualattorney.com/blog/young-family-estate-planning

Specify more than one guardian of your children & finances: they don't have to be the same person & you want to specify backups in case your first choice isn't able to serve. For example, the person who would be great raising your children may be terrible with money, & vice versa. Usually your spouse is your first choice, followed by #2 & #3 in the event you both are killed.

You also want to specify who inherits if your entire family dies in the same event.

Trusts are usually not needed until your net worth exceeds 5 million or you have a child who will need lifetime care as an adult.

TaxChick

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Re: Will / Trust
« Reply #2 on: July 18, 2015, 09:17:55 PM »
If your company offers a legal plan, this is usually the cheapest way to complete a will and trust.  I signed up during open enrollment and completed mine at no additional charge.

mxt0133

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Re: Will / Trust
« Reply #3 on: July 18, 2015, 09:21:26 PM »
Trusts are usually not needed until your net worth exceeds 5 million or you have a child who will need lifetime care as an adult.

Unless you intend to give your entire estate to the guardians of you children if you and your wife pass then you will need an trust if you want to leave instructions on how funds should be used to care for your children.  How much you think should be used for housing, food, primary education, college, ect.  If you do not have a trust and you don't leave it to the guardians, who can spend it any why the want, then the only other option is to leave your money to your kids which will also require a trust.

One simple site if you do not have will/trust yet is: http://getyourshittogether.org/

Spend the 1-2k for an estate attorney or a DIY for about $500 but get it done with ASAP.

AlwaysLearningToSave

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Re: Will / Trust
« Reply #4 on: July 19, 2015, 07:04:21 AM »
Trusts are usually not needed until your net worth exceeds 5 million or you have a child who will need lifetime care as an adult.

Unless you intend to give your entire estate to the guardians of you children if you and your wife pass then you will need an trust if you want to leave instructions on how funds should be used to care for your children. 


There are two basic types of trusts: intervivos trusts and testamentary trusts. Intervivos trusts are created during the life of the person creating the trust. Testimentary trusts are created in by a will and only come into effect upon the death of the person creating the trust.

Intervivos trusts are often used for the larger estates referenced above to achieve tax savings and streamline post-death administration of the estate. A testimentary trust is often more appropriate for younger families without substantial assets. Testimentary trusts are often used to hold substantial life insurance proceeds for the benefit of children.

As an attorney who does estate planning, I am very wary of do-it-yourself arrangements. My general attitude (as biased as it may be) is that you can pay me now to do it right, or you can pay me later to clean up the mess--and it will cost substantially more for me to clean up the mess. Some people are comfortable with risking the mess cleanup costs because they will only occur after their own death. But do you really want to burden your spouse or the guardian you choose for your children with a messy estate?  This is one of those instances where I believe you get what you pay for.