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October 04, 2007


Mary WanderPolo

I agree that living trusts may be over sold, but what is more often the problem is that once the trust has been sold there is no follow through to ensure that the assets of the settlor were actually retitled into the living trust. It is not enough to create a trust for a client, someone must follow up with the client to ensure that assets are retitled correctly. An unfunded living trust is truely a waste of the clients funds.

David Goldfarb

We recommend living trusts in two circumstances where probate may be difficult. First, where there is real property in multiple states which will necessitate ancillary probates. Second, where the next of kin are not the beneficiaries under the will and they will be hard to identify and locate. We have had cases requiring extended searches, hiring of genealogists, and publication which unnecessarily depleted the estate.

Jim Schuster

Robert, please, please please! Let us, as elder law attorneys, put an end to the question "Do I need a living trust?" by framing it in terms of probating the survivor's estate. Yes those observations are PART of the issue but fail entirely to answer the client's question.
Let us consider the question in this context: "Do I need a special needs trust?"
Our clients age and some will have significant periods of disability. Kinda like the disabled children we are ready to plan for. Why on earth would we forget the primary client is beyond me. Many of them have significant resources to avoid the easy solution of nursing home placement. I am a firm advocate of "special needs" trust language for my client, use of trust protectors, etc., where the client has no clearly identified and reliable caregiver team.

I second David G's observation with this that whenever I see a client with significant investments I must advise them it is much easier to manage those by a successor trustee than by an agent under DPOA.

If we answer the client's inquiry with "Who will help you if you are disabled?" We are that much closer to answering their real question "How could a trust help ME"

Robert Fleming

You are absolutely right, Jim. I posed the question the way it usually gets asked: "Do I need a living trust?" I agree that a much more important question is "How could a trust help me?" It is almost always a cost/benefit analysis--will I get enough benefit from a trust (probate avoidance, easier estate management if I become incapacitated, etc.) to justify the cost (higher lawyer's fees, some small difficulty with transferring title to assets)?

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