I was recently speaking with one of our clients regarding the manner in which to set up their estate legal affairs to make things as simple as possible for their loved ones when they are gone. We discussed their family, their assets, who they would want to be in charge if they couldn’t make their health care and financial decisions any longer, and what they would want to happen when they are no longer here. Essentially, I asked these clients the same series of question that I ask every family that works with our office. This family indicated they wanted things to be as simple as possible for their surviving family. Therefore, we ended up putting in place a revocable living trust so that everything would simply and easily pass to the surviving family members after death without the long, costly, drawn out, and intrusive government probate court process.
However, this family had concerns about naming their adult son as the successor trustee of their trust. You see, this family’s trust was going to be somewhat sophisticated and unique. This trust would survive their deaths and would continue so as to provide for the education of their two granddaughters who were ages 2 and 4. In addition, this family’s concern was they did not want to burden their adult son with too much extra work after their deaths.
I explained to this family that the job of the successor trustee is to manage the trust assets, pay bills and expenses, pay taxes if any are due, and distribute the trust assets according to the provisions of the revocable living trust. I continued to discuss with this family that their adult son would simply just step into their shoes when they are gone, and distribute their daughter’s share of the trust to their daughter and his share of the trust to himself. However, he would be required to maintain the trust accounts and maintain a record and accounting of the assets. Also, he would simply distribute the assets to the two grandchildren as those assets were needed for their future education. Finally, when the trust accounts had been completely exhausted, or when the two grandchildren finished their education, he would simply dissolve the trust and distribute the remaining assets to the grandchildren. I explained to this family that the job of successor trustee was relatively simply and when that time comes, if their adult son has any questions, he could always call our office and I would be happy to guide him through this process.
This family was relieved that they could set up their legal affairs in this way and not make things unduly burdensome on their adult son whom they intended to name as the successor trustee.
If you have questions about estate planning in Tennessee, establishing a revocable living trust or an irrevocable Medicaid trust, avoiding nursing home poverty and Medicaid planning, or any other estate planning topics, then I encourage you to attend one of our free live educational events scheduled this month. At these events, you will hear a lot of real life stories about families that paid thousands of dollars in unnecessary expenses, families that were able to avoid unnecessary expenses, and families that were able to protect their assets from unnecessary nursing home costs and expenses.
I look forward to speaking with you at one of our upcoming live educational events!