Putting Together an Estate Plan

Written by nickel - 4 Comments

Nearly eleven months into 2006 (and almost a year and a half after I first wrote about this), we finally took a solid step toward fulfilling one of our New Year’s Resolutions… Putting together an estate plan. I actually debated about using LegalZoom to put together our wills, but we ultimately decided against it. Instead, my wife and I met with a local attorney yesterday morning to set the wheels in motion. And no, it wasn’t the $100 guy — something about him just didn’t sit right.

Our situation is pretty straightforward, but with four young kids in the mix, we don’t want to cut any corners and risk unnecessary complexities in the event of our deaths.

We’re doing mirror-image wills that name each other as primary beneficiaries along with a testamentary trust (to take care of our kids; more on this later) as the secondary beneficiary. We also took care of naming guardians for our kids, choosing a trustee to oversee the testamentary trust, and choosing an executor. As it turns out, these three positions are all being filled by my brother and his wife (actually, the two of them are the guardians, whereas my brother alone is serving as the trustee and executor). While some people might be concerned about possible conflicts of interest in combining guardianship of our kids along with trusteeship, we set it up this way for a variety of personal reasons, and we are comfortable with our decision.

Our initial consultation was basically an information-gathering session. The attorney will now draw up our wills, send them to us for inspection, and then we’ll head back into his office for the signing. The only thing that will remain to be done at that point will be to change the beneficiary designations on our life insurance policies, retirement accounts, etc. to name the testamentary trust as the secondary beneficiary.

Published on November 22nd, 2006 - 4 Comments
Filed under: Estate Planning
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Comments (scroll down to add your own):

We went through the same process three years ago, and it was a relief to finally have our plans in place. We ended up choosing one of my siblings to be the guardian of our children and another of my siblings to be the Trustee. I wasn’t concerned about a conflict of interest as much as choosing the suitable person for the job. Basically, the childless sibling with good money management skills controls the money and the sibling who is a good parent (but married to a spender) will get the kids.

In addition to the trusts and wills, our attorney also recommended drafting health care proxies, power of attorney, and Declaration of Homestead (state specific) as part of our Estate Plan.

I’m embarrassed to say I still haven’t named the Trust as a secondary beneficiary for all of our accounts though.
Comment by Frugal Frugalson — Nov 22nd 2006 @ 2:02 pm
Be careful that the trust is a “see through” trust if you want to preserve the tax deferral on retirement plan assets for your children.
Comment by Joe Taylor — Nov 22nd 2006 @ 9:06 pm
Great job getting that finished! I put off estate planning because of the cost but then I found a way for my wife and I to get a quality will for free! I wrote about it, http://www.moneysmartlife.com/.....e-planning.

Of course it was just a will, no trust involved like yours, but if you’re a young couple and just starting out, free is a pretty good price!
Comment by moneysmartlife — Nov 22nd 2006 @ 9:31 pm
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…so you didn’t use the “$100 guy” — how much did it cost for the better lawyer ??
Comment by Benson — Nov 27th 2007 @ 10:55 am