Why doesn't everyone who has anything of value, have a trust?

Why not trusts???..... to me a lot of whether trusts can be the way to go depends on what amount of assets there are. Trusts have costs & need an income stream to keep the trust costs paid & from getting an unplanned unstructured defund. Some assets need to be producing $ to feed the trust. It's my understanding that most trusts (QTPs, "A", bypass, gen skip...) nowadays need to be in the 700k - 1m range to be done & under advisement. Most don't realistically have the $.

What instead some do -if there not the $ for trust- is "beneficiary designation" or LLC on all assets that you can. Insurance policies, pensions, iras, annuities get designation. POD designation on banking. Property owned by LLC. So when they die there's maybe just maybe homestead property thats the only asset to deal with by small estates affadavit or muniment of title (both simple & minimal cost). Could ideally take care of almost all assets so no trust or its costs needed.

Igloo, I've been mulling over the issue of an LLC to hold assets. Are you referring to a Limited Liability Company, or does LLC represent something else?

More of your astute wisdom, please!

Probably because of the expense of getting a Trust put together, it can be expensive. My parents and myself sat face to face with an Elder Law Attorney, that way she was able to ask us question and we ask her questions in return. The Trust was a 3-ring binder thick of legal forms. Included were new Wills, Funding Instructions, Power of Attorney, Health Care, Memorial Instructions, and the complex Trust.

The only problem was that my Dad had dragged his feet doing his "homework" of filling out the forms which asked for information. My Dad didn't want the Attorney to know how much money he had.... oh dear, we got a problem in the room. I kept pestering Dad to do the paperwork.

Dad never got any of the paperwork done and he passed. So I am dealing with Probate which is a maze and complex. So now his Estate is paying for the Elder Law Attorney to help walk me through this jumble of documents.... [sigh].

Thank goodness my Trust and all the related documents is complete and signed.

Dustien, I don't want to discourage you but trusts are far too complicated to be done by someone who's not an attorney, or a paralegal acting under an attorney's supervision. I still have to read and reread and reread my father's trust to understand everything, although actually the trust is probably simpler than all the notes I took from meetings! There were soooo many complex issues.

You are right, though; other than the 1041s (which vary in complexity by the assets of the trust), estate resolution CAN be a lot easier than dealing with probate.

My parents (my mom) had the foresight to have a trust done. My mom has passed and my dad is now in assisted living. I have all POA and my brother and I are now both trustees for their trust. Yes, it makes sense and yes, they spent quite a bit of time and money doing this, but it is so helpful.

Dustien, My father didn't even have a Will, he just assumed his wife would get everything. I think they just don't want to deal with their own death.

Pam, that is so sad. In Arkansas, the kids get a portion, usually leaving the wife with not enough to live on. People really need to check their state's inheritance laws. My mom and dad were young enough (70s) when they, wisely, realized they weren't going to live forever and felt a trust would be how to go. It cost them 900.00 plus/minus but they felt so much better after.

I've looked into doing our own through Legal Zoom for much less and I think that's the way we are going to go. We have a daughter and a granddaughter we want to give to equally. I don't forsee any problems, but I want them to be able to access everything right away and not have to spend a penny on lawyers and probate.

Freq... that is so sad you had to go through all that. Glad you learned from it. Garden...the reason I think we can do this is because we have Dad's Trust as a Guideline. I could really just retype dad's trust word for word and put in our own info rather then his and then we would proceed to put all our assets into the trust. I'll be talking to my husband about getting seriously on this after I get home.

We've run into a hitch with Dad's trust. He opened an account here in TX where he was living with my brother and sis in law and funded it with his IRA yearly mandatory withdrawal this year. He wanted this account to be his "gambling" account so he didn't bother to put anyone on it as beneficiary and put it in his name only, rather then the trust. Now, we are having to get a lawyer involved and that account is going to have to be probated in Texas as a "foreign will", which will take time, money and was totally unnecessary! Glad it's only this one account though...everything else (all in trust) is going smoothly thus far... I'm just worried that the money in this account is going to be needed to pay his Income Taxes and won't be freed up by the time they have to be paid. Darn it Daddy!

Boss, so glad you're went so well! That's the best case scenario...

GA - yes a limited liability co. to own a property. I don't think it's possible to do a beneficiary designation on property so if they die it has to be in a will as to distribution. But an LLC continues on, with 1 less K-1 filed. Some places do not let homestead exemptions happen on property owned by trust or a LLC but only for a person. So my thought is that if theres not enough $ for trust & they want to avoid probate and homestead exemption (& benefits) doesn't matter then an LLC gives pretty good protection with flexible ownership.

I had a meeting with my financial advisor today and I brought up trusts. It was his opinion - which seems to be the same as igloo572's - that unless you are dealing with a substantial amount of money, you are better off designating a beneficiary for every account in order to set up who gets what and to bypass probate. Of course this doesn't account for items such as jewelry or family heirlooms but rather cash, brokerage accounts and even deeds to property. As for the tax benefits with a trust, he referred back to it taking a large amount of money to make the tax benefits of a trust worth all that goes along with establishing and maintaining a trust. The one benefit he did site is what he termed "control from the grave" - as in the trust I have for my special needs son. Long after I'm gone I will still be controlling how that money will be spent to benefit my son.