Avoiding Probate through a Trust
We say it all the time – the best way to avoid probate is through a trust. However, it is really nice to see when others also agree with this advice. Please take a look at the article below. Because, as we know, revocable Trusts in Leawood avoid probate. This sounds easy and can avoid a lot of problems later.
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Trade Talk: Avoid probate by creating a trust
With the unexpected death of my baby brother this summer, I’m not waiting to get my affairs in order.
I remembered last week that I’d named Jeff ” who died of a sudden heart attack in July at age 55 ” as the payable-upon-death beneficiary on my checking and savings accounts. I promptly went to the bank and changed the beneficiary to my twin sister, as my daughter Jessica is a minor.
I did the same beneficiary change on my traditional IRA, Roth IRA (which I’ve been funding for Jess’ college) and 401(k), on which I had no beneficiary listed! if you’re married, your spouse is the legal and automatic beneficiary on IRAs. But I had my husband, now ex, sign away his rights to my IRAs days after I realized we were no longer a trusted team.
Without proper planning, the 401(k) and other assets with unnamed beneficiaries eventually would go to Jessica. But they could be held up in probate for months. When I wrote about wills and trusts in 2002, only one-third of Americans had wills and the national average for a probate was 16 months.
Upon my death, Jessica’s father would become her guardian, but I don’t want him in charge of money she’d inherit. I know my sister would be a good steward of assets and would distribute money to Jessica as needed and when she could handle it wisely.
Four years ago, Oklahoma’s banking laws were changed to allow a bank or credit union to release up to $20,000 to the heirs of a deceased person without probating the estate. But if the person died with a will, or if the person had other property such as a house, it may still be necessary to probate the estate.
The deed to my house is in my name only, and I need to do a transfer-on-death deed or something, and leave instructions about my car and personal belongings. I learned from past reporting that a written will holds more water than downloading a fill-in-the-blank template from the Internet.
My investment banker at Chase tells clients that it’s cheaper to get a trust than pay for an estate lawyer to handle probate. A friend, who’s an investment professional in Tulsa, said the cost of a trust and probate is about the same ” some $1,500 to $1,800 ” but it’s well worth the money to create a trust now, he said.
Under Oklahoma law, one-third of the estate ” in the absence of a will or trust ” goes to the surviving spouse and two-thirds to the deceased’s children. It’s split 50-50 if there is only one child. Single people’s assets will go to their parents.
The silver lining to my brother’s death, though a microscopic one, is I’m cherishing each day and vowing to no longer sweat the small stuff. I’m also putting my affairs in order now, with plans to create a trust the soonest I possibly can.
Estate Planning is all about peace of mind. What estate planning is all about is discovering the right devices to execute your basic needs. We do this using the most up to date tools so that we can prepare a personalized strategy at the least expensive possible expense.
The Eastman Law Firm is an estate planning law firm. We concentrate on estate planning so that you can be assured that you are getting the most up to date techniques.
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