Category Archives: Trusts

What about my pet?

I’ve got a great dog, a turtle who will live for 80 years, and three opinionated cats.  Right now there are several household members who will take care of them should I get in an accident, or have to go into the hospital.  What should someone who lives alone be considering for their pets?  I can’t imagine anything worse than coming from the hospital to find malnourished (or worse) pets.  One tool is a Pet Care card.  Carry it in your wallet to let people know who to call if you wind  up in the hospital .  Also consider posting one on your fridge for first responders in the case of a medical emergency at home.  Send me an e-mail with your mailing address, and I will send you the card that I give my clients.

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Who gets Mom’s engagement ring?

When doing estate planning, we (lawyers and clients alike) tend to focus on “titled assets” like real estate, bank accounts, retirements accounts, etc.  while in reality, many of our most precious possessions are “untitled assets” or personal property.  This includes jewelry, artwork, collections, furniture, special decorations, and even pets.

In our day to day life, our mother or grandmother’s special tea pot may well hold a spot in our emotional life that no bank account could.  When a loved one passes away, it is these items, precious in our memories and family traditions, but negligible in fungible value, that cause the greatest strife.  When a parent dies leaving behind a cat and a dog, who will take care of them?  When your children remember Christmas at the grandparents’ farm, who will be the steward of the family Christmas tree ornaments?  Which daughter or granddaughter will wear an antique engagement ring?  And who will have the hope chest that has been passed down for three generations? 

These questions exist in families across cultures and socioeconomic strata and as families blend and break, the questions become more complex.   At your next family gathering, take a moment to look around and think about which items carry family memories, and perhaps ask your children or your parents which items are important to them.  This information can be kept in a memorandum with your estate planning documents, and amended as needed.  Make a note of what you’d like to go where, and let your family, friend or neighbor know why.  It can make your gift a part of your legacy in  a way that a list of probate assets never will.

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What’s the difference between a will and a trust?

I recently conducted an estate planning seminar, and one of the most confusing subjects was “what, exactly, is a trust, and what does it do?” (followed closely by “do I need one?”)  The reason this is so hard to understand has to do with the abstract nature of a trust.  When you own something, you usually have both “title”– that is you say “it’s mine”, and the use or benefit of the item.  If it’s your bicycle, for example, the “title” is in your name, and you get to ride it.  Generally, this is what we mean when we talk about owning something. 

A trust effectively splits the title from the beneficial interest. So the trustees hold title to the asset, for the benefit of someone else.  The trustee is given responsibility (or duty)for managing the property, in the manner specified by the trust document, while honoring both the donor’s intentions and the interest of the beneficiary.  So for example, if you were leaving $100,000 of life insurance money to your children, you might want someone else to manage this money for them until they reached a certain age.  The manager would be the trustee, while the children would be the beneficiaries. 

Trusts come in many many varieties, depending on the type of asset that is in them (for example, real estate trust or insurance trust), whether or not they can be changed (revocable vs. irrevocable), and when they come into effect (inter vivos is during lifetime, testamentary is upon death).

A will, on the other hand, is simply a document that disposes of your assets upon death.  A will can create a trust, or put assets into a trust.  And that final question, “do I NEED a trust?” depends on the type of assets you have, and what you want to do with them.  This is the kind of question you’d want to discuss with your estate planning attorney….

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