When it comes to estate planning, you’ve probably heard advice like, “You need a trust” or “Avoid probate at all costs.” While these ideas might hold true for some, not everyone needs a trust, and probate can sometimes be an appropriate step. Understanding these topics can help you make informed decisions for your family. Let’s break down why:
What Is a Trust?
A trust is a legal arrangement that allows you to transfer assets to a Trustee. This person manages the trust for those you want to benefit. One of the advantages is that it helps avoid probate—the court-supervised process of transfering your assets after death. Trusts can provide an additional level of privacy, speed up the transfer of assets, and offer protection for your loved ones in difficult times.
Disadvantages of a Trust
While trusts offer many benefits, they aren’t essential for everyone. For example:
Trusts Can Be Expensive Setting up a trust requires meeting with an attorney to prepare the trust documents and potentially hiring professionals to administer it, which can be costly. For some individuals, these expenses outweigh the potential benefits, particularly if there are simpler ways to achieve the same goals. For example, if your family is in agreement, the Court can waive the requirement of making your assets public.
Trusts Need Active Management Once a trust is created, it needs ongoing attention. You have to transfer assets into the trust, update it as your financial situation changes, and ensure that it remains aligned with your wishes. This level of involvement is unnecessary if simpler tools can efficiently achieve your goals.
How to Save Money on Your Estate Plan with a Will vs. Trust
You’ve probably heard that you want to avoid probate. But in many cases, it’s not as bad as you may think. In fact, sometimes it’s a good thing!
In Some States, Probate Is Streamlined Each state has its own process for probate. Some states, like California and Florida, are complex enough that having a trust is a good idea for most people. However, in Tennessee, probate can be relatively quick, inexpensive, and straightforward, making it less of a concern. Of course, it’s a good idea to listen to your attorney about what is best for your family.
It Provides Oversight Probate ensures that a court oversees the distribution of assets, which can be beneficial for resolving disputes or ensuring that creditors are paid. For families with potential disagreements, this legal oversight might prevent further conflicts.
Not All Assets Go Through Probate Assets such as life insurance policies, retirement accounts, and some jointly owned property pass directly to beneficiaries. If your estate consists of these types of assets, putting them in a trust may not make much sense. In fact, many people structure their estate planning so that nothing will go through probate and then use a will as a back-up plan. (Because you know we always want to have a back-up plan!)
Is a Trust Right for Me?
While it may not be for everyone, a trust may be a good choice if:
You have a large or complex estate.
You own property in multiple states (which could trigger probate in each state).
You want to maintain privacy regarding the distribution of your assets.
You have minor children or beneficiaries who require special care.
Depending on your situation, your attorney may even recommend using a trust as a part of your will, which can be less expensive and time-consuming than creating a stand-alone trust.
Estate planning is not one-size-fits-all, and the decision to create a trust should be tailored to your unique situation. Your estate planning attorney should be able to help you weigh the costs and benefits, address any “what ifs, and explain how the plan reflects your goals. Ultimately, the key is to create a plan that provides peace of mind for you and your loved ones, whatever form that may take.
If you have questions about trusts or other estate planning tools, reach out to our office. We’re here to help you navigate the process and make the best choices for your future.
A Davidson County will and trust lawyer’s job is to make sure that you have all of your ducks in a row so that if you become incapacitated or die, your loved ones will know how to manage your estate and follow your wishes. Laws in Tennessee vary from those found around the country, which is why you want to work with an attorney who is skilled in understanding your specific needs. One area that should be considered is your service providers.
Make a list of your service providers and put it in your estate plan
“Service providers” covers a wide range of individuals involved in your life. Should you be unable to communicate with them, you want to ensure that your trustee, executor, conservator, or other responsible person is able to communicate with them on your behalf. Having them all listed in one place will make this job much more manageable.
Household Providers
This list should include all of the people or companies that you deal with when it comes to the maintenance of your home. In some cases, your home will need to continue to function in your absence, and your representative will need to be able to contact these people to make sure things keep running smoothly. In other cases, whether you are deceased or incapacitated, there are certain services that you may no longer need, and the person in charge needs to be able to contact the service providers and cancel with them.
Some examples of household providers that you will want to list might include:
Computer support
Food or water delivery
Gardening
Pet care
Housekeepers
Heating/Cooling system maintenance
Heating oil delivery
House sitters
Pest control
Pool or spa maintenance
Utilities
Vehicle maintenance
Basically, anything that you have performed on a regular basis should be noted, along with contact and payment information.
Medical Service Providers
You should also provide your representative with contacts for your medical service providers. This information could be very valuable should you need medical attention but be unable to reach out to these providers on your own. Additionally, if you have standing appointments with these providers, it will be helpful to have them canceled so you don’t accrue charges for services you’re not using.
Some of the medical service providers you may want to include on your list are:
Chiropractor
Counselor
Dentist
Massage therapist
Ophthalmologist
Physical therapist
Primary care physician
Psychiatrist
Specialists
Personal Service Providers
There are other types of regular services that you may use, and you’ll want to include these as well for the same reasons already mentioned. Some personal service providers to keep in mind for inclusion:
Childcare provider
Hairdresser
Home care provider
Meal preparation
Transportation
Tutors
Additional Information
Along with the contact information for these service providers, it’s a good idea to make notes about when they are expected, and you may even want to include service agreements and contracts. For example, if you have a standing arrangement to have your sprinkler system blown out each fall, make a note of that.
Your estate planning attorney may not include all of this information directly in your estate plan, but they will want to be able to assist your family with where it can be located when the need arises.
If you are seeking estate planning services, please book a call with our office here .
When you aren’t clear about your wishes, you leave a blank space for your loved ones to try to fill in. This can be incredibly stressful to them – even if you’ve expressed your wishes to them but didn’t write them down – so it’s important to know your wishes ahead of time. Learn what could happen to you if you don’t make your wishes known.
What Happens if You Become Incapacitated in Tennessee?
If you become incapacitated in Tennessee (a temporary coma, for instance,) and have no medical power of attorney set, your loved ones may have to go to court and then a judge will decide who can make medical decisions for you if you’re unable to communicate your wishes.
Trying to determine your wishes after you can no longer express them can be an extremely stressful time for your family, which is why it’s so important to communicate your wishes ahead of time, just in case anything happens to you.
What Happens if You Die without a Will or Trust in Tennessee?
If you die without a will, that is called “intestate.” This means that whatever inheritance you leave behind, including your property, is subject to Tennessee intestate succession laws. Intestate laws typically leave your property to your surviving spouse and/or children, but parents, siblings, nieces, and nephews could become eligible too.
Here’s a quick breakdown of what would happen in Tennessee if you are married or have children:
If you have a spouse but no children, the spouse would inherit your entire estate, even if you’re separated.
If you have a spouse and children, the estate would be divided equally among all parties (except that the spouse can receive no less than 33% of the overall estate).
If you only have children, your estate would be split equally among all the children.
Keep in mind that only your biological and adopted children will inherit from you if you do not have a will. If you would like to leave part of your estate to step-children, foster children, godchildren, or other children who are close to your heart, you’ll want to make plans for that in your will or through non-probate beneficiary designations.
Here’s what would happen if you died unmarried and without children:
If you have a parent, the entire estate would go to your parent(s).
If you have sibling(s) but no living parents, the estate will be split equally among your siblings.
If you have no parents or siblings, the estate will be split equally among your siblings’ children.
If you’ve none of the above, the estate would be split equally among paternal and maternal aunts and uncles.
You don’t have to die to see how this one might end if you don’t write your decisions out!
Who Makes Funeral Decisions if You Die in Tennessee?
Similar to the above, if no one has been legally designated to make funeral decisions on their loved one’s behalf, it falls to the next-of-kin, which would be the spouse or adult children. Once the family member takes responsibility for making and paying for their loved one’s funeral arrangements, they sign a legal contract that obligates the funeral home to follow instructions from that family member alone.
Make sure you tell your family what you want so there’s a consensus during a difficult time..
What if there are no next of kin?
If there are no next of kin (as defined above) and no personal representative, any other person willing to assume responsibility and arrange the funeral (including the funeral director) can make funeral decisions, after attesting that a good faith effort has been made. As for your estate, if no family can be found it will ultimately be turned over to unclaimed property.
Learn More from Graceful Aging Legal Services
Don’t leave a blank space for your family members to fill in regarding your end of life wishes. Don’t keep them second-guessing. Instead, leave something that people can read like a magazine to know what you want your life – and death – to be like. Want more tips like this one? Sign up for our newsletter!
Aging often comes with increased healthcare costs and healthcare costs impact everyone—regardless of income level. Miller Trusts are a legal tool that helps individuals with high income qualify for Medicaid long-term care benefits. With a Miller Trust in Tennesee, you can become eligible for TennCare even if you are over the “income cap” set by the state.
What is a Miller Trust?
The Medicaid program (called TennCare here in Tennessee) typically requires limited income to qualify. A Miller Trust is a legal arrangement designed to help those with high income qualify for Medicaid long-term care benefits. By establishing a Miller Trust, also known as a Qualified Income Trust, you can redirect your income into the trust, your income then becomes exempt from Medicaid income calculations.
Why are Miller Trusts Used in Tennessee?
Tennessee is an “income cap” state for Medicaid. That means that those who have income above the cap will not qualify for TennCare. Miller Trusts are used primarily as a tool to create eligibility for Medicaid/TennCare even when you might have too much income. There are times when assets may fall within Medicaid eligibility requirements while income exceeds eligibility limits. In this case, a Miller Trust can help.
Without a Miller Trust even when assets meet eligibility requirements, income may exceed the limits for Medicaid eligibility. By redirecting income into a Miller Trust, you can effectively reduce your income for Medicaid eligibility purposes, ensuring you can receive necessary long-term care benefits.
The Benefits of Miller Trusts
There are several key benefits associated with establishing a Miller Trust.
Qualifying for Medicaid
The primary benefit of a Miller Trust is that it allows individuals with middle to high income to qualify for Medicaid long-term care benefits. A Miller Trust provides a way to legally redirect income into the trust effectively lowering income for Medicaid eligibility purposes.
Preserving Income
Miller Trusts also provide a means to preserve income. Instead of having to find a way to reduce your income to meet Medicaid’s income requirements, you can redirect your income into the trust. This ensures you can continue to receive your income while still qualifying for Medicaid long-term care benefits. It provides a way to maintain some financial flexibility while accessing the necessary healthcare coverage.
The Process of Setting Up a Miller Trust
The process of setting up a Miller Trust involves several key steps.
Gathering Financial Information
The first step in setting up a Miller Trust is gathering all relevant financial information. Financial information must be thorough including all income sources and other financial details to create a comprehensive financial report. An effective Miller Trust helps you meet income qualifications for Medicaid. In order for a Miller Trust to work for you it is critical to have an accurate understanding of your current financial situation.
Selecting a Trustee
The next step, in setting up a Miller Trust is to select a trustee. It is important to choose someone who possesses good organizational skills, excellent financial management, and will always prioritize your best interests. Opting for a trustee (typically a family member) who works with a lawyer who has a focus on Medicaid planning to set up the trust ensures they can adeptly navigate the intricacies involved in establishing a Miller Trust. Once the trust is established, it’s usually not too difficult to care for the account.
Creating the Trust Agreement
Once a trustee has been selected the next step is to create the trust agreement outlining the terms and conditions of the trust, including how income will be deposited into the trust and how it will be used for qualified expenses. Consulting an attorney experienced in Medicaid planning is crucial to ensure that the trust agreement is drafted correctly and in compliance with all applicable regulations.
Funding the Trust
After the trust agreement has been created and signed, the next step is to fund the trust. This involves transferring income into the trust, which will then become exempt from Medicaid’s income calculations. This typically involves setting up your Social Security to be direct-deposited to the trust account. You can likely do this online if you have an online account with the Social Security Administration.
It is essential to follow all necessary procedures and guidelines when funding the trust to ensure that it is done correctly and in compliance with Medicaid regulations. Make sure you work with a banker who is familiar with Miller Trusts to be sure that all regulations are followed and ensure that all necessary documentation is provided. Your attorney should be able to provide recommendations for banks they have successfully worked with in the past.
Meeting Medicaid Requirements
Finally, meeting all Medicaid requirements is essential. Income limits, reporting, documentation and any other Medicaid requirements must be met for a Miller trust to be effective. Consulting with an attorney with experience in Medicaid planning can help ensure all requirements are met.
Managing a Miller Trust
Once a Miller Trust has been established, proper management is essential. Here are a few key considerations.
Using Trust Funds for Qualified Expenses
The funds in a Miller Trust should be used exclusively for qualified expenses. This includes medical and long-term care costs that are not covered by Medicaid/TennCare. For example, if Medicaid covers one set of dentures every two years but you lose yours before it’s time to get a new set, you can use it to cover another set of dentures. It is important to keep accurate records of all expenses paid from the trust to ensure compliance with Medicaid regulations.
A trust can also be used for professional expenses. For example, a Miller Trust can be used to pay for legal fees.
Keeping Accurate Records
Record keeping is a vital aspect of managing a Miller Trust. Accurate records of all income deposits, expenses paid and other trust related financial transactions are necessary for proper trust management. The records are required for ongoing compliance as well as the TennCare redetermination period when you will need to submit proof that you still financially qualify for TennCare/Medicaid.
Reporting to TennCare/Medicaid
As a Miller Trust beneficiary it is important to report any changes in income or financial circumstances to TennCare/Medicaid if there is a significant increase. This includes significant increases in income sources, the amount of income deposited into the trust, and any other relevant financial changes. By keeping Medicaid informed – and by getting in touch with an experienced Medicaid attorney – beneficiaries can maintain their eligibility and continue to receive the necessary healthcare coverage.
For example, if you get a Miller Trust and then get an inheritance, you may no longer be eligible for TennCare/Medicaid. However, at that point, it would be wise to talk to an experienced Medicaid attorney, because they may be able to help you if you notify them quickly and before the inheritance is received.
Potential Challenges and Considerations
While Miller Trusts can be a valuable tool for Medicaid planning, there are some challenges and considerations to keep in mind.
Legal and Financial Implications
When establishing a Miller Trust there are serious legal and financial considerations making it vital to consult with an attorney who has Medicaid planning experience. An experienced attorney will help ensure all legal requirements are met and help you fully understand the implications of a Miller Trust.
Estate Recovery
In all cases, Medicaid will seek to recover expenses paid on behalf of a Miller Trust beneficiary from the beneficiary’s estate after their passing. In other words, anything in the Miller Trust at the end of life will go to the TennCare/Medicaid office This is known as estate recovery. It is important to understand the potential implications of estate recovery and to plan accordingly when establishing a Miller Trust.
Monitoring Eligibility Requirements
Medicaid eligibility requirements can change over time and it is important to monitor these changes to ensure ongoing eligibility. It’s in your best interest to stay informed about updates and changes to Medicaid requirements.
Consult Graceful Aging Legal Services for Your Miller Trust
Miller Trusts provide an option for individuals who have significant income and want to qualify for Medicaid long term care benefits. If you or someone you love falls into this category, a Miller Trust is an option to divert your income.
In addition to the oftendifficult conversations surrounding estate planning, establishing and managing a Miller Trust can be quite complex and challenging. It is advisable to seek assistance from a lawyer who focuses on Medicaid planning to navigate the process of establishing and managing a Miller Trust.
If you have more questions about Miller Trusts and would like to know if it’s a good option for you or your family, click here to schedule an initial call with our office. We’d love to work with you!
If you’re closely related to someone who has recently passed away, it’s likely that you’ll be in line to inherit at least a part of their estate. It can be a complicated process, depending on the circumstances. To make this process easier for you, we’ve outlined some things you need to know as a potential inheritor of a Tennessee estate.
1. Take the time to grieve
If you’ve just lost a loved one, the first thing you need to do is take the time to grieve. This could be overwhelming, especially if you were close to the person who has passed away. You may not even know how to react if you’ve been left a large inheritance. Taking the time to grieve the death of a loved one is important, and you should not be pressured into making decisions. Also, don’t rush through any of the legal processes outlined in this article. There’s no need to hurry to open an estate, and you should make sure that you’re given enough time to make well-thought-out decisions and take care of things properly. All of the necessary information will be available to you once you are ready.
2. Take the time to understand the terms of the will
Another important thing to do is take the time to understand the terms of the will. If there was a will, then you’ll need to know who was named as the executor (aka personal representative) of the estate. You’ll also need to know whether there are any special provisions in the will, like leaving a specific piece of property to a specific person. You’ll want to know where the original will is being kept, as well as the executor’s contact information so you can stay informed about the progress of the estate.
Once the will is probated, there will be a record of it that you can access at any time. You’ll be able to see the contents of the will, as well as the names of everyone who was named as a beneficiary. This is something that you’ll need to keep in mind when communicating with the people who were named in the will.
3. Find out if there is any debt included with your share of the inheritance
Debt follows the person who incurred it, so a person’s debt usually belongs to their estate- not those inheriting from them. However, if your loved one left you anything with a debt tied to it, you may have to figure out how to resolve the debt before accepting the inheritance.
This includes things like car loans, mortgages, or other debts that your loved one may have had when they passed away. Even if you inherit something with debt tied to it, you do not have to inherit debt. You can choose not to accept the item or to sell it and take whatever it is worth after the debt is paid.
It’s important that you know if there is any debt included with your inheritance so that you can plan accordingly. It’s possible that you could get a loan to cover the cost of the debt and then pay it off gradually over time.
In my personal and professional opinion, it usually makes sense to take over a loan on something that will appreciate, such as real estate, but not on any depreciating assets like a vehicle. However, this is something that will have to be decided in consideration of your personal situation.
4. Find out what happens during the probate process
The probate process is the process of opening a probate estate, gathering all assets owned, and distributing the assets from the estate. During the probate process, the executor of the estate will file the will and any other documents that might be necessary with the court and has the responsibility of distributing the assets according to the terms of the will. These documents will become part of the public record. The executor of the estate will open an estate account with the court, and you can check in on it and see what progress is being made as the assets are distributed.
5. Check for Inherited IRA Rules and Taxes
If you inherit retirement accounts from a loved one, you will need to make a decision about how and when to cash out the account.
While spouses can easily “roll” retirement accounts to the surviving spouse, this is not an option for anyone else. As the non-spouse beneficiary of a retirement account, you have two options: (1) take all money out immediately or (2) you can “stretch” the distributions up to ten years.
Because most retirement accounts are “tax deferred” accounts, you will want to explore the tax consequences of any retirement investment accounts that you inherit. If your family member invested into a 401k, IRA, or similar type of account, they did not pay taxes when contributing to their retirement. That means that taxes must be paid when the money is taken out.
The financial institution will usually help you by holding an estimated tax payment but you will still want to make sure you are aware of what you will need to pay at tax time to account for those inheritances, no matter how you took the distribution.
6. Allow time for the Executor to carry out their duties
As soon as you’re named as a beneficiary to a will and the estate has been opened through probate, you can expect that the Executor will begin to take care of things, such as contacting creditors and making arrangements for the sale of any real estate. It’s important that you give them some time to do what they need to do. Expect that it will take about a year for the entire process to run its course. This is a rough estimate and will vary depending on how complicated the estate is, how many assets there are, if any estate tax is due, and whether there are any potential disputes. The Executor will keep you updated on progress and let you know when you can expect to receive the inheritance.
7. Communicate with the Executor
Keep in regular communication with the Executor of the estate. Ask if there is anything you need to do or can do to help. If you have questions, make sure that you ask the Executor and get the answers that you need to the point you understand. You can also ask to speak with the attorney for the estate. If you are having issues with the Executor getting back to you, or you suspect there are difficulties, it may be worth consulting a lawyer on your own.
8. Decide how you want to handle your share
Before you get a check, decide how you want to spend any money that you receive. Maybe you and your deceased loved one had already talked through what they hoped would happen with any funds they left you. Many people have a financial goal that their inheritance will help them reach, such as buying a house or investing in their own retirement. Some families use the money to take a trip together and make memories. Having a plan is the best way to make sure that your loved one’s legacy is honored.
9. Update your Plan
One of the most important things to consider is that receiving an inheritance could cause your own estate planning to need to be updated or revised. If you are currently the beneficiary of a trust or other estate planning document, you should contact your estate planning attorney to determine whether or not you need to make any updates.
If you are looking for a Middle Tennessee probate attorney or to create a Tennessee will, click here to schedule an initial call with us.
April Harris Jackson is an Elder Law attorney based out of Nashville, TN. She is also a Chairperson of the NBA Estate Planning and Probate Committee.
You don’t have to be wealthy to benefit from creating a trust fund! Create a revocable trust with our Nashville attorney as a part of a well-thought-out estate plan. All it takes is proper planning and administration. Come learn the basics with us!
What is a Revocable Living Trust?
A revocable living trust (also known as a living trust or revocable trust) can be a great way to help your loved ones protect their wealth and pass it down to future generations. It does this by creating a legal arrangement in which assets are placed within a “trust” and managed by a trustee(s). In most cases, when you set up a revocable living trust, you are also the trustee.
Why would I want to set up a revocable living trust?
There are many benefits to setting up a revocable trust to pass on your assets. One of the main reasons someone sets up a revocable living trust is because they want 100% control over how and when the assets will be used. This provides protection for your assets and prevents mismanagement. Many people prefer to set up a trust over a will because it provides a private, and hassle-free transition of assets to the family. You can set up a trust to fund many of your family’s future financial needs. For example:
Use a trust to pay for college
Parents often wonder if they should fund their children’s college education through loans, a 529, an IRA, or a trust. There are pros and cons to each option, and it ultimately comes down to what the parents feel is best for their family. A trust can be a little more flexible and offer a way to provide a continuous flow of benefits. This is perfect for a parent that wants peace of mind when it comes to their child’s future.
Provide financial support for a person with a disability
Estate planning for someone with special needs requires a lot of consideration. A trust is a powerful tool that you can use to provide financial support. While Special Needs Trusts are unique and irrevocable, an attorney can create provisions for a revocable trust to become irrevocable after your death. Special Needs Trusts provide stability and predictability in a person’s life, allowing them to maintain financial stability after you are gone. It can also help an individual with special needs remain eligible to receive Medicaid benefits. If you are worried about supporting a person with a disability, reach out to us! Our team is here to help.
Use a trust to donate to a charity
A trust is a great way to simplify the process of donating to a charity. Using a trust to fund a charity is private and much easier to create than a foundation.
Pass down your large assets with a trust
A trust can be a great way to pass down large assets, such as a house, to loved ones without having to go through probate or other legal hassles. This is because a trust agreement creates a legal document that outlines who will own the property and how it will be managed. Certain types of trusts can also protect your assets from being taken away by creditors or the government.
Determining Whether a Trust is Needed
When creating an estate plan, one of the decisions you will have to make is whether a revocable trust is needed. If you want to do something more complicated than an outright transfer of assets at death, a revocable trust is probably right for you.
Advantages of a revocable trust
Here are some of the advantages of a revocable living trust in Nashville, TN
Avoid probate – If you’re like most people, you want to avoid your family being exposed to the lengthy process of probate court. A well-managed trust negates the need for this.
Privacy – Privacy is a cherished commodity and many of us would like to have some degree of privacy when it comes to our finances. A revocable trust can provide a way for people to have privacy while still maintaining control of their assets, even after death.
Provide for future generations- A revocable trust can distribute outright at a certain time or may provide for generations past the creator’s own children. If you have concerns about how your children or their spouses may spend their inheritance, a trust can be a way to make sure that assets are used in a prudent way and preserved for future generations.
Disadvantages of a trust
Hiring an attorney – The upfront fee of hiring an attorney can intimidate people and can be seen as a disadvantage to setting up a trust. However, the cost should not be a determining factor. An estate planning attorney will understand the legal system and its implications on your estate.
Asset accessibility – A family trust may be less accessible to beneficiaries than other types of estate plans.
Difficult to change – It can be more difficult to change or revoke a trust than a will.
Revocable living trust vs a Will – What’s the difference?
The difference between a living trust and a will is mostly timing and control.
A revocable living trust allows you to change the terms or revoke the trust. It “lives” and operates alongside you while you are alive. This is important because it gives you the ability to control your assets and make decisions about how your money is used. You can also change your mind about how your money is used or who gets access to it after you die.
A Will, on the other hand, only goes into effect after you die. It specifies to the probate court how you wish for your assets to be transferred.
A revocable living trust is designed to become irrevocable after a certain event occurs- often the death of the first spouse in a long-term marriage.
Step-By-Step Guide: How to set up a revocable living trust
Step 1: Hire an Estate Planning Attorney near you
Regardless of the size of your estate, you must get counseling from a qualified estate planning attorney in your state. While every law firm is different, most follow a process that is similar to this:
How to hire an estate planning attorney
Reach out to a law firm
At Graceful Legal Services, PLLC, we offer you the chance to see if we are the right fit for each other first. The first step is to schedule your free 15-minute call. During this call, you will discuss your needs and your situation. Our intake coordinator will let you know if we can help you and give you an estimate of the attorney’s fees. If we are a good fit, and you decide to move forward with our services, you will be invited to schedule an hour-long Strategy Session with our attorney.
Do a paid consultation with an attorney
At GALS, we offer an hour-long Strategy Session. At your Strategy Session, you get to discuss your situation with our attorney, ask questions, and share concerns. After our attorney gets all of the details, they will provide a recommendation to fit your needs. They may recommend a specific kind of trust or discourage you from making one altogether. Our firm will also provide a step-by-step plan of action that you can use to achieve your goal. In other words, get a consultation with an estate planning attorney to help you decide what is best for you based on your assets, your family situation, and your goals.
Hire an attorney to carry out your plan
After your consultation, you will know if you need to hire an attorney. Let’s assume that you do at this point. It will be up to the firm to send you their contract for legal representation. We call this a “Representation Agreement”. Once you sign the Representation Agreement and pay the retainer fee, you become a client.
A word of caution:
Please do not set up a revocable trust online or by yourself. While we would love to send people to a less expensive option, the truth is that things get so messed up when you’re dealing with trusts. Our firm has tested many of the will and trust drafting software (curiosity killed the cat, right?) and there’s a lot of room for error. You cannot imagine how messed up a trust like this could be.
The key point is this: If you are going to set up a trust, hire an estate planning attorney to discuss your options. There are rules that need to be followed in order for a trust to operate correctly.
Step 2 – Gather Information Needed to Create a Trust Document
A trust document is an important legal document that sets forth the terms and conditions of your trust. Your estate planning attorney will be responsible for the meat and potatoes of the trust document. However, you will be responsible for knowing who the players will be. You will also be responsible for outlining the assets and property you would like to place within your trust.
At GALS, we use decision-making software that makes everything easier. If you would like to get a glimpse of the software, consider taking our Virtual Estate Plan Challenge. With this 7-email series, you will be guided through thought exercises to prepare you for creating your estate plan. At the end of the challenge, you will be invited to try out the software. It costs nothing and it’s easy!
In order to understand the trust document, you need to be familiar with these legal terms:
Legal Terms in a Trust Document
Grantor
Grantors are the individuals or entities who transfer assets and property to the revocable trust. A grantor is a person who signs the trust document as the initial settlor.
Initial Settlor
The person who sets up the trust. Same as the Grantor.
Trustee/Executor
The person or entity who administers the trust. You can have more than one trustee but it’s not common. Sign up to watch this Webinar: It Takes Two, or Does it? if you would like to learn more about having multiple trustees or executors. The trustee you choose must be completely trustworthy. Choose your trustee wisely. If you are unsure about trusting someone you know, hire an attorney or a Trust Company to act as the administrator of the trust.
Successor Trustee/Executor
The trust document lists who will be the successor trustee in the event of incapacitation or death of the first trustee.
Beneficiary(s)
A beneficiary in a revocable trust is someone who receives benefits from the trust, such as income or property. The beneficiary can be an individual, business, charitable organization, or any other legal entity. A trust can have one or more beneficiaries. The beneficiaries may receive the trust property either immediately or at some later time. A trustee must distribute the trust’s assets to the beneficiary whenever the trustee determines that the beneficiary is entitled to those benefits. The beneficiary’s name(s) must appear on the trust document.
In addition to naming beneficiaries and how you will fund the trust, you will also need to outline how the trust assets will be managed and distributed. What are your terms? Do you want your children to inherit from the trust at a certain milestone or date? Do you have stipulations you would like followed? Your attorney will make suggestions of what to do.
Step 3 – Sign and notarize the trust agreement
The state of Tennessee requires that the trust agreement must be signed and notarized in person. The process of notarizing your revocable trust provides a layer of security and helps to prevent fraud. It also helps to confirm validity after the grantor dies.
Step 4 – Transfer assets into the trust
Every asset that you want in the trust needs to be transferred. This means that all titles (house, bank accounts, etc). need to be transferred and renamed to that of the trust’s name.
In conclusion
Setting up a family trust in Nashville is a relatively simple process that can provide a great deal of financial security for you and your loved ones. By following the steps outlined in this article, you can rest assured that your assets are well-protected.
If you are considering hiring a lawyer to set up a trust in Tennessee but are unsure if it is the right option for you, don’t hesitate to schedule your initial call with us. We can help you determine if trusts are right for you and if we can help create one that meets your specific needs. Our free 15-minute call can provide you with the information you need to make an informed decision.
