Financial Blog Network

First, lets discuss a will, which everyone has heard of and think they need. This is a common misconception promoted mainly by attorneys who specialize in wills. With a will, you must still go through the states process of probate. To have an attorney draw up a will costs between $100-$500. In order for a will to be effective, it must be drawn up every single year. When you lose your loved one, and are ready to execute the will, it goes into probate, which once again requires an attorney, but here is where they get the big money. The charge for this is approximately 5% of the estate.

So say dear old Aunt Josephine has a house she paid $20,000 for in 1950, savings accounts around $50,000 and antiques and collectibles in excess of $25000 the attorney will then see to the value of her assets (that house is now worth around $250,000). The attorney will go to the court house and fill out the probate papers, listing all these assets.

Then you must wait for the courts to probate the will, which can take from 9-24 months, at which time you see no money, but the attorney sure does. When the courts are through, the attorney walks away with what he charged Aunt Josephine to write that will for 20 years (on the low end $2400, plus %5 of her assets, approximately $17,500 and filing costs for the probate. All the while, you are responsible for her property taxes, insurance, etc…

Beware of attorneys who write and probate will, this is the biggest scam in the legal business.

A living trust is the best way to insure that your family gets all that you have, plus you by pass the probate process and totally eliminate attorneys.

First and foremost, you must find a reputable company that writes living trusts. AARP has the best in the business with over 50 years in doing this, they leave no stone unturned. An interviewer will come to your home, and explain the whole process. They will ask you every question that will or may arise in the event of your death. This process takes about 3 hours. They then turn these facts into their attorney, who in turn writes it up and sends it back to you. After you notarize it, a living trust is more effective than a will.

One of the great aspects of the living trust is there are empty pages in it where you can write in what you want your loved ones to have. If your granddaughter has always admired your antique dishes, or your daughter deserves the photo albums, all you need to do is write it into the living trust book and sign it.

Every year, the author of your living trust will come out and do a check up to see if anything major has changed, and the best part is, there are no additional fees.

Upon the death of the holder of the living trust, the assets will be distributed immediately, foregoing any and all probate, and freeing up all the time and money that causes so much pain and hard feelings amongst family members

There is no comparison between the two. Everyone should have a living trust.

Article Author :Sharon_Perkins_Smith

Tags: irs, insurance, tax

Related posts

• Wills and Trusts - Types and Descriptions (0)
• Why Do I Invest in Tax Lien Certificates? (0)
• Which Of My Debts Should I Clear First? (0)
• What You Always Suspected About Life Insurance Fees, Is It True? (0)
• What Financial Traps Await the Unwary Stay at Home Mother? (0)

Tags: insurance, irs, tax