Probate Attorney Dean Patrick has seen his fair share of circumstances that result in a need to establish a trust. One of the prominent scenarios that a trust can help you and your loved ones avoid is entering the probate process. The decision to establish a trust for your estate can draw from several different scenarios, and our office has gone to the effort to document those that are frequently experienced. Follow our pseudo-family Aaron, Barbara, Collin, and David as they encounter issues that could have been resolved with a trust.
Imagine a happily married couple, Aaron and Barbara, who decide to create a will to maintain their assets and also provide for their two children. As the years go by, Aaron and Barbara have lived out their lives and pass away. As part of the probate process, their wills are submitted to the probate court and one of their children, Collin, is appointed executor of the probate estate. Unfortunately, the probate process is not a stress-consultation one, so Collin decides to hire a lawyer to help navigate the daunting legal system. A few months later, Collin, his brother, and his attorney have gone through the hoops and the estate is divided as permitted by the will. A year or two later, Collin and his brother start receiving noticeably more unsolicited phone calls from telemarketers. Once they get an explanation, they come to find out that a marketing agency had farmed the public probate files, which included personal contact information and details on the estate.
Take-Away: If Aaron and Barbara had established a trust to accompany or in place of the will, the loss of privacy, the stress of the probate court, and the costs associated with probate could have been avoided.
Aaron and Barbara have a disabled child, David, who is receiving government benefits. Unaware of the interaction between government benefits and an inheritance, the parents create a simple will distributing their assets equally between the two children. Many years later, Aaron and Barbara pass away. After being subject to the probate process, David receives a letter informing him that his government benefits had been forfeit as a result of his inheritance.
Take-Away: While there was some money for David’s care in the estate, this situation could have been avoided with a supplemental (special) needs trust established for David’s benefit.
Aaron and Barbara have two twin 18-year old boys when they suddenly pass away in a tragic car accident. Because they had plan appropriately, a will transferred the balance of the estate equally to the twins. While Collin and David are legal adults, being an adult does not always mean that you are always ready to accept financial responsibilities. Collin decided to use his inheritance to pay for college, buy a practical car, and invest the rest into stocks. David decided that he did not need to go to college and then bought an expensive car and apartment for him and his friends to live in. While David spent his entire inheritance before Collin graduated from college, Collin did not anticipate the stock market crash and lost the majority of his funds.
Take-Away: This situation could have been avoided if Aaron and Barbara created a trust that would have nominated someone wiser and more responsible to manage the finances for their children and work to assure that their health, education, maintenance, and support were taken care of.
Aaron and Barbara controlled a modest estate and thoughtfully decided to create a trust for their two sons. The married couple lived a happy, full life and passed away within the same year. Collin and David are aware that their parents had created a trust, so they had presumed that they did not have to go through probate. Unfortunately, Aaron and Barbara’s attorney did not tell them that they needed to re-title their assets.
Take-Away: This situation comes down to the attorney not providing Aaron and Barbara with all of the information necessary to establish their trust correctly. It is important to hire an experienced probate lawyer when dealing with these significant matters.
At the The Patrick & Associates, PLLC. in Metro Detroit, we advise all of our clients by addressing their needs, which are often established by the situation. Let Dean Patrick take care of all of the legalities of your and your loved ones’ estates to ensure that your wishes are abided and that your beneficiaries are adequately protected.