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No Living Trust? HUGE Costs Without One When you Pass
Now that I finally got my act together on this at a late age, I can lecture you on the importance of having a living trust, an advance medical directive, and a power of attorney all set up. Even if you are only 21 years old, but it’s like herding cats to get my own children to act.
by Ronald Farrington Sharp
In a nutshell:
- A living trust is a far more cost efficient and speedy way to transfer your assets upon your death. The alternative (probate) is slow and costly and subject to all sorts of frustrations. Do you want a stranger deciding things and to pay huge sums to do it too?
- Without an advance medical directive and medical power of attorney, the doctors can pretty much do whatever they want, ignoring your parents or children or spouse. And they will, since insitutions seek to avoid all liability, maximize profit, etc. They will give you that quadruple COVID booster, the TPN that destroys your liver, and then finish you off with Remdesivir or some such. And charge you for a slow and painful march towards death for months or years. That’s what big medical centers do. I don’t want that... do you?
- Financial power of attorney: if you are iincapacitated for some reason, how will your affairs be managed until you regain functionality?
A good attorney will make sure all of this and more is taken care of. Depending on where you live, expect to pay $3000 to $6000 in places like the SF Bay Area, for everything done right and proper. And sometimes, penny-wise is pound-foolish. One small mistake can cause a lot of headaches.
Think you can do it yourself? I thought so at first, and after having a good attorney get it all sorted, I learned enough to strongly discourage that idea unless perhaps your assets are small and no house, etc.
Recommended: Living Trusts for Everyone second edition, by Ronald Farrington Sharp @AMAZON
...Certain states set the attorney fee portion of the probate cost as a percentage of the gross estate. This may actually be even more unfair than the hourly rate method. In California, for example, the following are the maximum rates that attorneys can charge for probate (and you can bet that nearly everybody is going to charge the maximum). 4 percent on the first $15,000 3 percent on the next $85,000 2 percent on the next $900,000 1 percent on the next $9 million 0.5 percent on the next $15 million So a typical $500,000 estate would have attorney fees of $13,000—a lot of money. However, the executor (also called the personal representative) would be entitled to an additional $13,000 fee. So now, we are up to $26,000 and have not included the cost of bonds, filing fees, inventory tax, and publication costs.
...if you live in a state like California or Florida, the laws do not even allow you to do probate without a lawyer. They say that every personal representative (think executor) must be represented by a lawyer. So you couldn’t do it yourself, even if you wanted to. Most everybody subject to probate in those states should have a trust.
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And so on.
