A Star Is Born
A caregiving agency had been hired by a long-distance daughter to check on her mom. The agency noticed the mom was not handling her bill payments easily and was becoming more confused. The daughter had her own child and life in another state.
She could not come to help mom. Mom refused to move to daughter. The professional fiduciary was able to step in as the newly named Trustee and Agent. After working patiently and slowly, she determined the client was overwhelmed with a fear of the work involved with moving closer to her daughter. The fiduciary helped her client become emotionally prepared. Once mom decided, daughter flew out to help her mom move. Now she is a “Star Client” because she was able to make her own choices and get the help she needed to accomplish a long-term goal. She can now see her only granddaughter grow-up and does not worry about arguments with her daughter about money.
A Worried Mother
A Naval officer and his loving wife adopted two children, late in life. After this honored veteran passed away, his wife began to worry about how her adult children would manage the modest estate she and her husband had built-up over their lifetimes. One of her children's health was failing.
The other had an addiction to gambling. She wisely chose to name a professional fiduciary to handle the trust and split into two FBO trusts until her children reach retirement age. The assets are managed for the benefit of these two adults many years later. If not for the worried mother’s foresight, the assets would be completely depleted.
A Collaborative Conservator
A daughter was very concerned for her parents’ health and well-being. Her brother was a drug addict and lived in the parents’ house since his divorce. The daughter was advised that a Conservatorship for both parents would allow her to care for them without the burden of direct conflict with siblings. A professional fiduciary was asked to step in quickly.
Within days the parents were placed in a wonderful Board and Care home and their assets were moved from the control of the impaired brother, who had been the acting Power of Attorney. This action, though costly, has immeasurable benefit to avoid the heartache of watching elderly parents subject to the unpredictable whims of the impaired son.
A Charitable Benefit
& Lifetime Income
An aging client had an only son. He lived out of state and could not be near her. She managed her daily life well, even as she approached her 90's. She loved her son, but every year when he visited, he took her to the bank to pull out a large gift “to tide him over”.
He never seemed to be able to take care of his finances. She created a Charitable Remainder UniTrust. This gives him regular income for life. When he passes away a dearly loved charity will receive the remainder.
A Bank Trust Company Resigns
A family’s wealth was built with real estate investments from the 1970’s. Over time, these purchases turned into a significant nest egg.
After her husband died, the elderly wife realized she needed help. She turned to a bank to step up as Trustee. When the bank demanded that she drop her long-time property manager, she resisted. The bank decided it could no longer serve her needs, so she turned to a private professional fiduciary who listens. She now has the comfort of knowing that her family holdings will not be sold and she can continue to have her “Circle of Care” involved in her life.
A Tale of Three Sisters
One of our clients knew his daughters opposing personalities often led to conflict. He wisely named a neutral, independent, successor trustee.
The three sisters did have disagreements during the trust administration. But, none of them had the ability to control the assets. This minimized the conflict. All three sisters received equal information and a final trust distribution that honored their parents’ legacy
We follow your wishes, as written in your estate planning documents.
Every California fiduciary (trustee, co-trustee, conservator, guardian, financial power of attorney, executor, estate administrator, or personal representative) is held to the standards as defined by the California Probate Code. This includes spouses, family members, friends, attorneys, CPA’s, bank/corporate trustees as well as private trustees, licensed or unlicensed.
A private trustee that is insured, bondable, and licensed by the State of California offers you and your family additional protection. In order to become a licensed fiduciary, the State of California requires a minimum of education and experience. The ACE Fiduciary Group aims to exceed expectations. Our team members bring proven experience in both estate administration as well as other professional expertise. By exceeding the requirements for licensing in the State of California, we can offer a professional approach to this vital service.
We all leave one behind. What will yours be? How do we use our time, talents, treasure and temperament? This is what will be remembered. We can make a difference in the legacy we are living today. Thoughtful planning can reduce your stress as well as help ease the burden on friends and family when we die.
We can help you review your wishes, values and plans with our unique process of LegacyMappingTM, which you can learn more about by clicking here.
Before you meet with your trusted attorney to prepare an estate plan, carefully consider the duties and skills required of a Trustee. You know your family, friends and loved ones best. While some may be quite capable, in many cases, the most loving decision is to name a professional trustee. This allows your friends or family to honor your legacy while a professional fiduciary can steer the estate through the legal and financial requirements.
A Revocable Living Trust is designed to avoid probate court to wrap up your trust distribution. Probate is the process in California in which the court supervises the distribution of your estate after death. For your estate to avoid the cost and time of probate, the assets must be transferred into your Trust.
You will be asked by your attorney to select a trustee to succeed you after your death. Your “Declaration of Trust” states your wishes in writing. The Trustee you select to carry out your wishes can transfer your assets to your loved ones and beneficiaries after paying final expenses and providing an accounting, without having to wait for court direction.
During your lifetime you are your own trustee. You may wish to select a professional trustee to manage your assets on your behalf when you become unable to do so yourself. Some people name family or friends for this job. This can become a problem if there is conflict in between beneficiaries or you may prefer not to involve non-professionals in this role to maintain privacy.
A professional fiduciary can serve as your trustee. This is especially true if you need assistance to manage personal finances or healthcare decisions. At times, there may be no suitable family members. Or, you may be concerned that those you have currently named might be overly burdened by wrapping up your affairs after your death or stepping in if you lose capacity. It can be less costly over the long run to name a professional fiduciary to be your Sucessor Trustee, Agent and Executor. A professional fiduciary’s fees are much, much more reasonable than the cost of ongoing litigation between beneficiaries. Also, a professional fiduciary normally carries E&O insurance and is bondable. This significantly lowers the risk of assets being improperly distributed than when contentious or irresponsible beneficiaries are also the Trustee. More attorneys are recommending that a professional fiduciary be named for a variety of situations. Please consult your attorney to determine if a professional makes sense for you. We are willing to discuss your situation with your attorney, upon your approval.
By creating your Living Trust, you are a “Settlor”. As stated above, you are normally the “Trustee” of your own estate during your lifetime. Likewise, during your lifetime you are also a “Beneficiary.” The person you name to step in when you are unable to act is the Successor Trustee. Upon your passing, those people or non-profit organizations you name are the remainder beneficiaries.
Certainly. A trust results by designating a successor trustee who will administer your estate according to your wishes after death. You can think of your trust as a substitute for a Will. A Will does not take effect until after your death and it usually requires probate by the court. A living Trust takes effect when you fund it with your assets; it then becomes a dynamic instrument for your personal wishes.
Your Living Trust will not take effect until you execute it by signing all the necessary papers, obtaining witness signatures, and having all signatures notarized. However, even then your trust will remain “unfunded” until you transfer your assets into it. It is simple to transfer your assets into your trust. For example, you can transfer your real property from your current ownership to your trust with a deed. The law does not consider such a transfer to be a “sale” for sales or tax purposes, because the trust is a separate legal entity. Please ask your attorney to assist you with real property title transfers to avoid mistakes which can be costly later. Most estate planning attorneys make sure your assets are properly transferred when the estate plan is created. Watch out for title issues that arise after divorce or refinance. Sometimes, large assets which are not in the trust still require a probate.
In addition, you should contact your bank or other institution where you hold assets and direct them to rename your assets and accounts as belonging to your trust. Your trust is considered “funded” after your assets are transferred to it. See your CPA for tax information. If you need a review and assistance with making sure your trust is properly funded, please contact our office to schedule a review appointment.
In a Revocable Living Trust you specify that you wish certain assets to go to certain persons or organizations upon your death. A revocable trust may also be used to segregate the separate property of spouses or domestic partners and decrease the risk of co-mingling and tracing problems.
Yes. You have complete control over your revocable living trust and all the property you transfer to it. You can:
- Sell, mortgage or give away property in the trust
- Put ownership of the trust property back in your own name.
- Add property to the trust
- Change the beneficiaries
- Name a different successor trustee
- Revoke the trust completely
If you are married and create the trust together, both spouses must consent to changes although either of you can revoke your portion of the trust entirely.
Yes. This is because at times assets come into your possession but do not get transferred into your trust. For example, if you inherit money but pass away before it is distributed to you. A simple “Pour Over Will” simply names someone to take action as the Executor who then “pours over” any assets which were not included in your trust for distribution under the terms of your Living Trust.
Additionally, should there be any court actions about you personally, such as a pending personal injury lawsuit when you pass away, the named Executor is the only person empowered at your death to step in on behalf of your estate.
When you create a Living Trust, a legal entity is established for the maintenance and care of your assets. In the event that you leave the country or become incapacitated, a Durable Power of Attorney allows you to designate an individual to act on your behalf in managing your personal affairs. In an extreme example, such as an incapacity, a Power of Attorney will enable your designee to transfer assets to your trust. In addition, your Power of Attorney for Finance is able to communicate with pension and handle retirement accounts or contracts on your behalf, while you are still living.
Many attorneys recommend that you have a Durable Power of Attorney for Health Care or Advanced Health Care Directive in your estate planning package. This allows a person of your choice to make medical decisions in the event you are physically or mentally unable to make decisions or give consent to treatment yourself.
No! However, different types of trust and different states may provide you with additional protection over the more common revocable living trust. Please seek competent legal advice on types of trusts (i.e. Nevada Trusts) that can provide some additional layers of tax or creditor protection.
In general, common revocable trusts are viewed as if they are your personal assets for the purpose of taxes and creditors. If you have income producing property in your trust, during your lifetime you will be taxed on the income in the same manner as if it were held by you without a trust. Only when a trust becomes irrevocable does it offer additional protections. If you have a particularly large estate (over $10,000,000) it would be a good idea to consult with a qualified attorney or CPA to maximize your estate and to avoid payment of certain taxes. Your Living Trust is an important part of your overall estate plan. Other measures may be recommended depending upon the size of your estate or charitable goals.
If you find you are becoming forgetful more frequently, see your doctor who may recommend a special type of exam to determine the cause and extent of any impairment. You may want to have your agent and Successor Trustee start helping you to protect you from the poor decision making and lower executive functioning. If so, see your attorney and explain that you need to resign as the Trustee and name your Financial Power of Attorney as soon as possible. This is due to unexpected turns that can occur with MCI. It is best to see your attorney while you still have legal capacity.
When families have conflict or there is a particularly difficult beneficiary, the named Successor Trustee is not required to take on the job. Please seek competent legal counsel about your situation BEFORE you take control of assets. It is much easier and much lower liability for you if you bow out when you know there will be interfamily conflict before you take on assets as the trustee.
Remember, a Successor Trustee has no power or authority to do anything until the first trustee either resigns, becomes incapacitated or dies. Speak up before this happens to avoid some of the litigation costs later.
While you may not have an estate to worry about yet, everyone over the age of 18 needs to have an Advanced Health Care Directive in case they are in the hospital with a coma or have a traumatic brain injury. You can obtain a form from the State of California for free. It will ask you to name three individuals and provide their phone number who you trust to make very crucial health decisions for you. This document is easy to do but be sure to talk to whomever you name so they know what you would want in case of this type of severe health event.
Once you marry, you may also want to have a simple will. This is especially true if you have children. The state of California assumes that without a legal document your family members are your first choice to care for your estate or children. If that is not your situation, or you do not want family to fight over the privilege of raising your children, secure a Will.
Once you purchase a home in California, most attorneys recommend that you and your spouse or domestic partner have an attorney prepare a Living Trust so that the real property can be transferred to the trust. This is because the statutory fees for a probate, which is required to transfer most real property, can be an unnecessary expense.