You can make your own living trust online very easily.
For those of you who aren’t familiar with this subject, a trust allows you to control who receives your assets after you die. But that’s just the tip of the iceberg.
A living trust also helps your beneficiaries avoid the expense and delay of probate that is normally associated with wills.
If you don’t have a proper trust, the court will decide how to split up your assets through probate.
This process can last a year or even longer. It can also devour a huge portion of your estate’s value in legal fees.
Living trusts can also give you more privacy than a will because you don’t have to register them with the courts in probate.
Depending on the situation, a living trust can help you avoid certain estate taxes (if it’s done right). This one step alone could help save a fortune on life insurance.
Last, if you become incapacitated, a living trust allows you to appoint someone else to manage your financial and legal affairs.
As you can see, the living trust could really be a great tool for you.
You can hire an attorney to create a trust for you of course. That could run between $1,000 and $5,000 (or more). If you have a very tricky situation, that might be the way to go.
But if your situation is straightforward, you should consider making your own living trust online. If you do, you could save 85% of this cost.
Of the companies that currently provide this service, I like LegalZoom best. They have a very simple questionnaire that takes less than 15 minutes to complete. They also have live human telephone support – a rare thing these days – in case you have questions.
Notes: Once you create your trust, remember to update it as required. This is not a “set it and forget it” enterprise.
Over time, your situation changes and/or the laws change. It’s smart to update your trust every three to five years.
And more important, make sure you move your assets into the trust the right way. There is nothing worse than going through the trouble of making a trust if you don’t fund it correctly.
I went through some of the questions and help screens. I have to admit that I got a better explanation from LegalZoom than I usually do from attorneys when I speak to them on behalf of some of my clients.
I like the fact that Robert Shapiro is behind this enterprise – a top-notch attorney with a reputation to protect.
The laws change all the time and I expect the site to update their trust program regularly. I feel more comfortable knowing that Mr. Shapiro has a lot to lose if he doesn’t keep the information up-to-date.
The biggest issue is how to know if your situation is straightforward or not. This is very subjective.
As a rule of thumb, if you have to ask, your situation is probably complicated. In that case, it makes sense to seek the advice of a qualified attorney.
Have you done your trust online? What resources did you use? Would you recommend Legal Zoom? Someone else?
Moneyedup says
July 25, 2010 at 7:06 PMWhile this seems like a good idea when I read about it, I don’t know if I would want my living trust online. It is a lot of personal information and if any of it got leaked out it would cause a lot of problems.
Neal@Wealth Pilgrim says
July 22, 2010 at 7:09 PMEvan,
I agree that many attorneys don’t do the work they should when it comes to trusts. Most just give clients letters of instruction – I’ve seen plenty of these.
On who decides…..I think this is a semantic issue and the main thing is, we agree. Folks should handle this pronto. Thanks for a civilized discussion….as always.
Evan says
July 22, 2010 at 9:50 AM“They also help your beneficiaries avoid the expense and delay of probate normally associated with wills. If you don’t have a proper trust, the court will decide how to split up your assets. They use a process called probate.”
– Living trusts only avoid probate if all the assets are then transfered into the trust.
– The Court does not decide who gets your assets. Ever. Probate is latin meaning “to prove” – you are proving your Will is appropriate. When you don’t have a Will your estate is said to pass intestate and you go through intestacy. In instestacy it is not the Court that decides where your assets go, it is the legislature who provides the Court with how assets should pass pursuant to family dynamics.
Neal@Wealth Pilgrim says
July 22, 2010 at 10:33 AMEvan, I respectfully disagree with your comment. Living Trusts absolutely help avoid probate. Just like seat belts save lives. It stands to reason that they only work if you use them.
And the Court absolutely decides who gets what if you have no trust. They decide according to the rules you reference but THEY decide…not the deceased — that’s the point.
When you have a will, the Court decides, how to interpret that will. That’s why probate is so expensive and takes so long many times.
Evan says
July 22, 2010 at 12:54 PMI draft living trusts and help people fund them all the time; I actually literally just got back to my desk where we (the client and I) decided a living trust is a perfect fit. But there is a huge difference between using a living trust and snapping a seat belt.
Most attorneys simply do not make sure clients fund their living trust. Ask any that you know on a personal level. They’ll say, “I do the deed, and then tell them to meet up with their financial advisor.”
The Court does not decide who gets your assets, the legislature does. There is a difference. The court can’t just willy nilly (I have always wanted to use that term lol) decide to give assets to a random 3rd Cousin when there are other family members alive. Regardless that should be scary and should be a reason that anyone get a Will or Living Trust.