For too long now, I’ve been living up to name and procrastinating in estate planning. With our first child on the way any day now, it is time to make sure that all the “t”s are crossed and the “i”s are dotted. That’s why about a month ago, I asked readers do you have a will or a trust?
I had been reading the book Living Trusts for Everyone: Why a Will is Not the Way to Avoid Probate, Protect Heirs, and Settle Estates, which makes a strong argument for a trust. It does a great job of putting the fear of probate into you as if it is the financial boogeyman that should keep you up at night. Maybe it actually is with your assets being tied up for months and the legal fees around it.
With that in mind, I went to see Janet Brewer an estate planning attorney in Palo Alto. She was kind of enough to offer a free hour consultation. What I found out was that we probably don’t need a trust. I was concerned about our real estate in multiple states. It appears that if my wife and I put them in a joint tenancy we can avoid probate. If I die first she’ll just get 100% of the assets and vice versa for me. We avoid probate unless we both die at the same time, which is statistically rare. In looking at our other financial assets (brokerage accounts, 401Ks, Roth IRAs, etc.) as long as we designate each other as beneficiaries it avoids the evil probate monster. Although when one of us dies, the other would be wise to get that trust set up.
So why not set up a trust now and just be done with it? Well, there are a couple of reasons. One is cost. Trusts are generally more expensive to set up. The bigger one for us is that we tend to move around a bit. We don’t plan to be in California forever and setting up a trust here would require a major reworking if we were to move back to New England as we hope. (In case you didn’t know, California tends to do a few things “differently” than the rest of the nation, and trusts are an example of that.) One thing she did mention is that we might be wise to set up a corporation for the properties. That’s something that I’ve looked briefly for Lazy Man and Money, but not the real estate. I’ll have to put looking into that on the to-do list.
At the end of the meeting with Janet Brewer, we all mutually agreed that her services weren’t exactly in our best interest, and we walked away without giving her any business. I love when people turn away business when it isn’t in the best interest of their clients. It gives me confidence that if there are others in Silicon Valley looking for estate planning services, her office would be a great place to start.
I love people who are honest about their ability to help you. I try VERY hard to be that type of person myself, though I know I slip sometimes.
Thanks for posting.
I am shocked you walked from her services…why not let her do your Will and Ancillary docs?
If I were responsible, I would have had her do at a minimum the ancillary docs. There are some complex issues even with those that I’m not comfortable discussing here. Clarity on a few things will be better resolved in a couple of months. The other thing is that my wife was literally due to give birth in the office… I didn’t feel it was fair to schedule an appointment that I probably wouldn’t be able to keep. In addition, I was refinancing two mortgages, getting life insurance, vaccination boosters for the baby.
There are other factors at play too. While having a baby is by far one of the biggest changes imaginable, I’ve got another “Oh one more thing” Steve Jobs-like addition that has yet to be announced.