Most people when faced with this question, or whether they have an “estate” would say no, but would be surprised to learn that they do have an estate and would benefit from this important planning.

General Rule: If you have an estate valued at over $150,000 you should have a trust.

Definition of “Estate” Includes the current value of the following assets::

1. Value of all Real Property Interests.
2. Time Shares.
3. Boats, Cars, Other Personal Recreational Vehicles.
4. Business interests including partnerships, sole proprietorships, corporations, LLP and LLC interests.
5. Value of all Brokerage, Corporate Stocks, Corporate Bonds, Mutual Funds, Treasury Bills, and Savings Bonds.
6. Retirement Assets including: IRA, Keogh, 401(k), 403(b)Qualified Plan, Employer Plan, Deferred Comp, Annuity, Pension Plan, Roth IRA.
7. Value of all Insurance Policies – Whole and Term.
8. Amounts in Checking, Savings, CD’s, Money Market Accounts.
9. Value of Notes and Deeds of Trust.
10. All other personal property including clothing, furnishings and other household goods.

Reasons for Planning:

1. Avoiding probate
2. Minimizing estate taxes
3. Self-directed distribution of wealth to heirs
4. Proactive management of health and assets in the event of incapacity.

Remember, planning is for the living. Implementing a trust now is your last chance to ensure that the beneficiaries you choose inherit what you choose, without the need for court intervention. If you are still not sure if this type of planning is for you, or are one of the small minority that really wants their family to experience probate, take the following example:

Bill Smith owned one home worth $500,000.00 at his death. All of his other assets; life insurance policies, cash, bank and investment accounts, retirement accounts, boats and cars, were either disposed of by him prior to death, or the beneficiary designations had been changed by him. He did not worry! Unfortunately, his children and beneficiaries soon found out that a home cannot be transferred by beneficiary designation. They were told that they had to go to probate to get the home, which they did. Unfortunately, probate cost them $26,000, in addition to court costs. The kids had to sell their family home in order to pay for the probate fees.

Could this scenario apply to you? Does your family risk probate? Call me to find out.

Downloadable forms

• Estate planning worksheet
• Estate Planning Presentation