Living Trust

Living trusts are a way of protecting your estate from the convoluted, long and expensive process called probate. Read on to find answers to the most common questions regarding living trusts, prepared and presented by an experienced and skilled living trust attorney in San Diego.

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What does a trust lawyer do?

A trust lawyer is a lawyer who specializes in estate planning, involving wills, trusts, powers of attorney and advance healthcare directives. A trust lawyer (or an estate planning lawyer) can help you draft, execute, manage and revoke the previously listed estate planning vehicles (will, trusts, POAs, AHD).

How does a living trust work?

A living trust allows you to pass property you own to your beneficiaries after you die or after you become incapacitated. A living trust is a legal document, but it’s also a legal arrangement and a set of relationships. The person who sets up the trust is called the grantor. The grantor transfers property into the trust. The trustee is the person who holds the trust property, or manages it for the benefit of the beneficiaries. The person who set up the trust (grantor) is also the holder and manager of that trust (trustee) during their lifetime.

The trust is a legal entity and therefore it is not necessary for the trust property to go through probate or any court proceedings for the trust beneficiaries to inherit the property once the grantor passes away. However, it’s important to note that even though trust property is not the personal property of the grantor, the grantor does retain control over it. Most importantly, the grantor can control the way the beneficiaries inherit the trust assets.

There are tax implications with every trust and this is something that a trust lawyer advise upon at a consultation. What you should know is that a trust can protect your estate not just from probate, but from certain taxes as well.

What is revocable living trust?

There are two types of trust – revocable and irrevocable. Irrevocable trusts are rarely used because they imply relinquishing all control over the assets transferred to the trust. There are benefits to this, but they only make sense in a very limited number of situations.

Revocable trusts are the same as living trusts or revocable living trusts. Either of these designations mean that the grantor can revoke the trust at any moment. They also get to retain control over the assets funded in the trust.

Would you like to see a revocable living trust sample? Contact our offices at 858-208-8900 for a FREE 30-minute consultation with a seasoned trust lawyer in San Diego!

What are the pros and cons of revocable trusts?

The advantages of a revocable trust are:

  • The beneficiaries inherit assets without the hassle and expense of probate or probates (if assets are distributed across states)
  • The beneficiaries don’t waste time or money going to court for guardianship or conservatorship if the grantor gets incapacitated
  • Revocable trusts are private, unlike the probate
  • Revocable trusts allow for planned distributions to minor beneficiaries at a time in their lives when they are mature enough to handle such assets

The relative disadvantages of revocable trusts are:

  • They are more expensive than a standard will and require more time for initial set up
  • They need to be funded properly and entirely, which means transferring assets and retitling them, which can be time-consuming

However, the benefits of having a living trust in California far outweighs the drawbacks of managing a trust.

Bear in mind that the time and money invested in a revocable trust shields both your estate from the exorbitant probate expenses AND your loved ones from emotional and psychological burdens, allowing them to access the funds you want to bequeath them. 

What are typical estate planning attorney fees for living trusts?

It is difficult to give a catch-all estimate, because circumstances differ. Some trusts are more complicated than others. Some trusts are founded by a single grantor, whereas others are set up by two spouses, etc. This all has a bearing on living trust attorney fees.

Even though an experienced estate planning attorney can help you with all things related to living trusts, you may need attorney’s help only for some things. For example, fees differ based on whether you need help drafting and executing the trust, just settling the trust, or everything together. You may need an attorney to contest a living trust, or to defend it after it gets contested.

Living trust is typically a part of an estate planning portfolio, which includes a will, powers of attorney, advance healthcare directives, etc. All of these documents and arrangements make for a continuous protection for your estate and loved ones.

Keep in mind that in general, trust set up and administration costs between less than 1% and 3% of the estate. Drafting a will and administering it through probate is typically between 5% and 8%.

At The Law Offices of Irina Sherbak we prefer to discuss typical estate planning fees, including living trust fees, in person, so that we can give you a personalized estimate.

Where can I get reliable and pertinent trust fund information?

Plenty of information is available on the internet regarding trust funding. While it may be convenient to gather some information on the internet, we encourage San Diego residents to discuss their interests and concerns regarding living trust funding with a highly qualified living trust and estate planning attorney in San Diego. You can only gain if you book your free, no-obligation 30-minute consult with our attorney – we will address your questions and supply you with accurate information for your case.

Do I need a living trust?

No two cases are identical. This makes it difficult to make informed decisions about your estate plans just from the information available on a site. Depending on the size of your estate, the type of your assets and some personal and family circumstances, a will or a trust (with a pour-over will) can meet your needs.

Roughly speaking, these circumstances could mean a will is enough:

  • Your estate is up to $150,000
  • Your assets are TOD and POD bank accounts and life insurance
  • You cannot actively manage your trust and estate plan
  • You do not have minor beneficiaries

A trust is generally better in these cases:

  • You have assets in different states
  • You have a large estate
  • You have minor children
  • You have dependents with disabilities
  • Your estate will likely incur estate taxes
  • You want to make provisions in case you get incapacitated

Please note that you will need a will even if you have a trust set up. It will deal with your personal property and in it you can appoint guardians for your minor children and make other provisions that you cannot make with a trust. A pour-over will catches any property not transferred to your trust and “pours it over” to the trust. This is a safety net if it should happen that you failed to retitle a property to the trust.

How to create a living trust?

A valid living trust specifies: the grantor, the beneficiaries, the trustee and successor trustee and the property funded into the trust. You can either find living trust forms for free online or offline, and fill them out or you can contact an estate planning attorney to draft the trust for you and provide you guidance.

A living trust in California doesn’t need to be notarized to be valid. However, notarizing a trust in front of two witnesses is a good idea because it provides more proof to the authenticity of the document. The notary has to make sure the grantor is of sound mind, aware of the nature of the act and its consequences and that he or she is not being coerced into signing.

In general, the trust document has two parts. The first, Declaration of Trust, is the core of the document. It specifies the name of the trust, the grantor, the beneficiaries, the trustee and successor trustee and the clauses of the agreement. Attached to the Declaration of Trust is typically Schedule A. Schedule A is not a legal document and has no legal bearing on the trust. It lists the assets of the trust. Schedule A actually exists to make things easier for the successor trustee. It is crucial that the assets listed are actually retitled to the name of the trust. The mere fact they are listed on Schedule A does NOT make those assets property of the trust.

Do I need a lawyer for a living trust?

You are not required to hire a lawyer. You can fill out available living trust forms free of charge and do the retitling of assets yourself. However, it can be confusing and cumbersome to do it yourself. Living trust attorneys, those with experience and qualifications, easily navigate the living trust process. Working with an estate planning lawyer, you get two benefits. First, you get accurate and relevant information to guide you. Second, you get a piece of mind that everything was done the way it should. The reason why you want to go through with a living trust is to make a plan for your assets and your loved ones at times when you can’t make decisions anymore, either because of incapacity or death. You don’t want to risk that goal by overlooking details. The presence of an estate planning lawyer ensures that your trust accomplishes its goal.

How to choose a living trust attorney to work with?

It is a good idea to find someone who lives in your area. If you’re looking online, search queries like “living trust attorney near me” should help you narrow down your search. It’s also a good idea to ask your friends and family for referrals.

Whether you go through referrals or listings for “living trust lawyers near me”, there are some things you should clarify with the attorney to make sure you’re making the right choice. First of all, it would be a good idea to determine whether the lawyer has experience with living trusts. Some estate planning lawyers deal mostly with wills and probate, so you want to check if the lawyer in question has experience with trusts.

Ask whether the attorney does both the executing and settling the living trust. Executing the trust means drafting the document and possibly helping you fund the trust, whereas administering or settling the trust means administering the trust once you get incapacitated or die.

Ask about their fee structure and the services you get.

You can ask them for a ballpark estimate of the cost of their services based on your estate’s worth.

Inquire about their availability. Time may be important to you.

Ask to see their biography and check whether there are any past clients that would be happy to share their experience.

Don’t base your choice on the cost alone. Transparency, easy communication, availability and reliability are very good indicators of the value of attorney’s services.

The Law Offices of Irina Sherbak are committed to serving you with integrity, honesty and dedication. We are here to help you preserve your estate and make thoughtful provisions for times beyond your control. Our positive reviews, qualifications and relevant experience makes us your prime choice in San Diego. Call us today to discuss your needs!