Thursday, July 1, 2010

Stupid is as Stupid Does....Got Trust?

As you know I am a transactional business attorney in California.  I advise all my business owner clients to get a comprehensive estate plan.  It has always been one of the issues that we discuss as we go over their legal business issues.  I am passionate about preventative law in the business context and tonight I became passionate about estate planning.  I attended a seminar by my estate planning mentor Shadi Ala'i Shaffer. During her presentation, she showed a slide that struck a cord with me.  It was something that made estate planning not just a issue that I discuss with my clients, but making sure that every client I have gets an estate plan.

If you live in California and own real property, have children, own a business (like the majority of my clients, or have assets over $100,000.00 you must have an trust to avoid probate.  A lot of people ask me what Probate is and tonight I saw the best definition that I have ever seen.

Probate = "A lawsuit, you file against yourself, with your own money, for the benefit of your creditors."  

I am going to say that one more "gain" (my grandmother used to say that to make a point.)

Probate = "A lawsuit, you file against yourself, with your own money, for the benefit of your creditors."

I guaranty you that if you are in one of the above categories and die with out a trust your estate will spend exponentially more money on probate that you would have paid to get a trust.  A trust is private.  Your trustee will distribute your assets pursuant to your wishes without public knowledge.  If you don't have a trust and have to go into probate, it is public record and all your creditors will be able to find out about your passing and submit claims against your estate.  The kicker is your estate and/or family have to pay for that privilege.  If you were alive, would you ever file a lawsuit against yourself for the benefit of your creditors.  No!  Why do it when you die.  It just doesn't make sense.

If you have any questions about estate planning, please contact me at The Out-House General Counsel.

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