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I was thinking of having a Living Trust drawn up for the benefit of my wife should I pass away so that she would have access to all of our assets without going through probate.

It occurred to me that she already has full access to virtually all of our assets because she's on the title to the house and she's listed as the primary beneficiary of my non-retirement and retirement mutual fund accounts.

Is there any need for me to draw up a Living Trust? It seems that she should automatically be recognized as the legal owner of all of our assets in the event of my death even without a Living Trust or Will. What am I missing here?

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    I'm voting to close this question as off-topic because it is about legal matters and not personal finance per se.. It should be asked on law.SE
    – Dilip Sarwate
    Commented Sep 23, 2018 at 9:59
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    @DilipSarwate - Look, obviously the topic of living trusts and wills can't be verboten on a personal finance web site because living Trusts and wills are discussed all the time in personal finance books and by financial advisors. In fact, I was spurred on to look into drawing up a living trust by a financial advisor. You wouldn't say that he was improperly discussing legal matters by doing that, right? And if I had thought to ask him whether a living trust is needed because our accounts are jointly held, he wouldn't have refused to answer by saying that was a legal question, right?
    – Barney Cowell
    Commented Sep 23, 2018 at 16:16
  • @ Samuel Weir - Good points. Financial planning is definitely part of Personal Finance.
    – Bob Baerker
    Commented Sep 23, 2018 at 17:06

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Everything depends on your local law.

In general, joint assets are not a problem whereas sole ownership assets are. Depending on location, the size of the estate may determine the need for probate.

Probate fees are usually larger than trust settlement fees. In my US state, the last time I settled a family member's estate, the maximum charge for probate was 4% versus 2% for a trust (15+ years ago).

You need a will in either case.

Probate is open to the public. A trust provides more protection and less transparency and is more effective in protecting against a party contesting the will.

And no, I'm not a lawyer but you should consult one for such decisions.

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    I've worked with 4 different people setting up trusts. I've offered the advice, and education so they knew what to expect from the lawyers. Trusts fees were unrelated to assets, and varied slightly by complexity. The range has been $2000-$3000. In one case, the assets were $5M+. I agree, probate can run high fees.
    – JTP - Apologise to Monica ♦
    Commented Sep 23, 2018 at 15:12
  • Trust fees don't vary much when setting up the Trust other than the complexity of the Trust and the number hours put in by the lawyers to create it. The variance occurs with settling the estate. There are legal limits as to how much can be charged for doing so. Many lawyers attempt to charge a percent fee rather than an hourly billable rate and that's where they get their extra pound of flesh.
    – Bob Baerker
    Commented Sep 23, 2018 at 15:48
  • Thanks for the info. Wasn't even aware that there were significant living trust settlement fees of around 2%. I thought that settlement fees as a percentage of assets were just related to wills, and that any settlement fees associated with trusts would be some small, fixed-cost fees.
    – Barney Cowell
    Commented Sep 23, 2018 at 16:22
  • To be clear, 2% and 4% is the legal allowable limit in my state for fees charged (uncontested) not the actual charges. You can do most of the Trust settlement yourself. You'll have to pay for death certificates, publication of Notice of Death in newspaper, accountant fees, appraisals (if any), etc. but why pay a lawyer to transfer title of assets from one party to another? Or be billed for 1/4 of a paralegal's hourly salary (a walk to the Post Office) to send letters to interested parties? Yes, use a lawyer but do everything that you can do and remember that a lawyer's fee is negotiable.
    – Bob Baerker
    Commented Sep 23, 2018 at 17:03
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Sit down with a lawyer who deals with estate planning. They can determine if the way your current assets (house, car, bank accounts, investments) are titled is appropriate to your situation and goals.

They will be able to determine if items need to be re-titled, and if there needs to be a trust established, or a will drawn up. They will know what transfers automatically and quickly and won't need a will or trust for it to happen, and what needs be in the documents to avid having to go through the court.

They will also be able to help you plan for situations such as kids, eldercare, long-term care, so you know the types of changes that may need to happen in the future.

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