Create your Estate Plan Today

Saturday, July 25th, 2009

Better Business Bureau reminds people that estate planning is not just for the wealthy.  They advise consumers to create an estate plan if they have something of value to pass on to their loved ones after death.  According to surveys, 55% of adults don’t want to set up an estate plan because either they don’t want to think of dying or they believe that they don’t have any assets to pass on.

However, if you don’t give your final instructions, nobody would know where your money should go or how will your children be taken cared of.  Do you want to leave these important decisions to the state?  If not, it’s important to create an estate plan and ensure that your wishes will be followed.

Creating an estate plan may be simple if you just draft a will.  But it can also be complex when you’re trying to set up a trust or a living will.  A will is something that you create to allocate your assets and establish guardianship of your children.  On the other hand, a living trust could set up conditions to distribute your assets while reducing inheritance taxes and avoiding probate.  Finally, a living will communicates a person’s desire for lifesaving measures in case there’s mental incapacity to decide on an emergency medical situation.  To help you draft these important documents, make sure that you consult an estate planning attorney.

Tags: attorney, Better Business Bureau, estate plan, estate planning attorney, living trust, living will, wealthy, will
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Lessons from Michael Jackson

Thursday, July 9th, 2009

Before he died, it’s a good thing that Michael Jackson made a smart estate plan.  He provided and cared for his loved ones because a separate document gathered his assets (estimated to be over $500 million, which exceeds his debt by $200 million).  It’s called a family trust - this ensures that his affairs would stay out of court and out of the eyes of the public.

He established this trust along with his will, and it’s also called a “living or revocable trust.”  The goal of this estate-planning tool would be to transfer all the property - including real estate, bank accounts, and cars - into a separate owned entity while maintaining the control as a trustee.  In Jackson’s case, he established a “Michael Jackson Family Trust.”

At his death, the control will be transferred to his successor trustee or co-trustee.  Most people (Jackson included) will set it up to “pour over” - this means that whatever assets remain outside of the trust would be eventually be added to the estate at their death.

The beauty of this trust is: people can avoid a public process called probate.  Aside from celebrities, this process would also make sense for people with significant assets because it would spare their heirs from a prolonged legal process.

Tags: assets, co-trustee, estate plan, Family Trust, legal, living trust, Michael Jackson, probate, revocable trust, successor trustee, trust, trustee, will
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Getting to Know Family Trust

Friday, June 19th, 2009

A family trust is also known as a living trust or revocable living trust.  It’s a legal document holding ownership or title to your assets and real property.  When you create a family trust, it means that you will transfer the ownership of your assets to this trust.  This asset transfer is typically called “funding.”

You do not relinquish control when you transfer title.  Therefore, you can still borrow, buy, or sell.  Family trust may look similar to a will because it includes information and details of the instructions for your estate at your death.  Unlike wills, however, properly funded trusts:

• -Do not go through probate,
• -Give you control over assets you’re going to leave to your children or grandchildren, and
• -Prevent courts from controlling assets at incapacity.

In other words, you will not lose control of your assets when you write a family trust.  Also, it enables you to pass the property to your family or loved ones after your death.  In addition, it allows you to pick out a successor trustee (or any appointed person) to make sure that your property will go to the people you chose when you pass away.  As a result, you’ll have peace of mind.

Tags: assets, estate, Family Trust, funding, living trust, probate, property, revocable living trust, successor trustee, title
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