I simply love how I revised my Trust!

Not to be too punny, but I did not trust my husband's future spouse with our Trust assets. I grew to need even more peace of mind that our family's Trust document will just take care of my husband and my sons, and no one else. Not some future stepparent, sig other, or anyone else that may join our team after I'm gone. And vice versa.

Preserving my sons' inheritance is so important to me. Having not met this hypothetical person yet that could threaten my plans, I am certain I can trust my own sons to take care of their dad in his old age (or me in mine) more so than I could trust someone else to take care of my team the way I would. In this scenario, I won't get a chance to vet them myself. Our original Trust indicated none of this. So, this year, we revised it. And I'm feeling content now.

Even if the newbie turns out to be an independently wealthy luv bug who has achieved sainthood, I'd just feel better legally separating our Estate to preserve at least half of it for our boys' sole use (with a handshake agreement of terms and conditions they must follow until both of us are gone from the Earth).

So, I've restated our Trust to insert a new peace-of-mind paragraph, to protect our sons' half for their direct benefit, with a caveat about when and how they can spend it that the boys have agreed to upfront.

Here's how I did it...

I don't plan on dying first. But who does? Women do tend to outlive men, but no matter which one of us dies first from here on out, our sons are now protected from any future potential stepparent consuming their inheritance with precisely these two little sentences:

"The Decedent's Trust shall be administered by the surviving spouse and the successor trustee named in Article One, Paragraph D, as co-trustees and shall be administered for the primary benefit of our children. In no event shall any other person benefit from the Decedent's Trust."

I love this addition because I've seen too often where children lose one parent, the surviving parent later remarries or gets into a common law relationship, the children are not thrilled with nor treated as a priority by the new stepparent, especially as they become grownups and start their own families and independent lives. The children even lose some touch with their surviving parent or feel worried about how their parent is being treated in the new partnership, but the children have little say and maybe no ability to influence or protect their parent from what is happening to them anymore. The stepparent then begins to shift the lifestyle or personality (even beliefs) of their parent and consumes the assets from the Estate they've married into, leaving little to nothing for the surviving children to ever inherit.

That's not the legacy I want my kids to remember me for anyway. Their dad feels the same way. Though he's a bit of a realist, saying he "probably won't care much, 'cuz he'll be dead." Funny. Not funny.

I have worked way too hard to imagine my equal half of our hard-earned net worth getting consumed by anyone other than my husband and sons or the people in my life I've already vetted and care for deeply.

I think of it like this: if I pass away first, I trust my sons to use their inheritance from my share of our divided estate wisely including drawing funds from the pot of money in the Decedent's Trust (my share in this scenario) that they receive to help first pay for any care needs their dad may have while he's still living--only should their dad's own half of our estate (which will be located between his Survivor's Trust and our Marital Trust) not suffice/be enough of a pot on its own to sustain him the rest of his life into his old age (low likelihood of his half not amounting to a sufficient amount to take care of himself, however there's a high likelihood of him living past 90 given that's how long his father enjoyed his days on Earth).

So, before the boys reach the age where the Trust is fully distributed, the survivor of us and our co-trustee, per the new language, will administer the boys' share fairly and for their sole benefit. Once of age, that half is all theirs to split in half, but with a caveat: the boys had to look us in the eyes and promise to use their inheritance first to take care of either of us who survives the other if and should our own resources in our Survivor's Trust and Marital Trust prove to be insufficient and run out early (if either of us outlives our half of the Estate).

We explained our goal is to never become a financial burden on their own hard-earned money and resources, we're just putting them in charge of the Decedent's Trust (our hard-earned money and resources) early such that if none of it is ever needed contingently for the welfare of their surviving parent, as a safety net, then they'll get to keep it all split between them. They don't feel entitled to spend it for themselves until both of us are gone. Again, we expressed how we never want them to have to use their own hard-earned money for our care and we want to guarantee/protect what they get to inherit as much as possible, and that's why we're planning this safety net provision accordingly.

Our sons now both understand it was going to be this non-standard design we needed them to understand and agree to, or else the prior standard design such that a one-day potentially new stepparent of theirs could potentially and legally spend through 100% of the funds in the entire Estate in a way that was not in their eventual best interest or benefit.

Once the point is reached where having to keep their inheritance earmarked for our safety net of funding our care becomes moot (when we're both gone), they can go spend their half of the inheritance from the Decedent's Trust, and anything left in the Survivor's and Marital Trust portion too, however they both would like to spend it (ideally they'll proceed as if "money matters" to them though, wink!).

This structure works better for our 'lil "team" (how we refer to our family), because otherwise, our original Trust's language could have netted the boys absolutely nada.

A "prenup" for any second marriage I would ever consider entering would be a given. But I won't be around to assure the same of my husband's potential newbie. The new paragraph in our Trust has me assured enough now. Of course, in the scenario that the two of us pass at the same time, we won't have needed the peace of mind paragraph at all, the boys will be getting 100% of what's left across the Trust for just their benefit.

I made one other important update to our Estate Plan, that I don't mind sharing with you if it helps you think about your own. Now that my oldest son is nearing adulthood, once eighteen he'll become the named contingent guardian of his little brother if we were both deceased while our youngest is still a minor child (the oldest son won't become a trustee or co-trustee unless our trustee and successor trustee are unable to serve in the role and he has at least reached the maturity of his twenty-fifth birthday). At eighteen, with a trusted trustee handling the funds in the boys' inheritance, I want my oldest to be his baby brother's legal guardian, and they agree with the logic completely. These two are inseparable.

In sum...

Thinking about how your loved ones will receive a financial legacy from you should be an important money matter deserving of your attention before it's too late.

Thinking about your wishes for what happens once you've passed is a hard thing to do. But not really; you take it one hypothetical thought at a time and you think about everyone you care for and how you want them to remember you as a protector, what you want them to do for you to carry out your Plan for all of your stuff on your behalf (the money, the property, the cars, the clothes, the collectables, and even the instructions for what you want done with your body or ashes as you describe in your Health Care Directive). If you leave it up to the State or Courts to decide for you, they will follow some insensitive and costly rubric of steps on your behalf that may make you 'roll over in your grave,' as the saying goes, and leave your loved ones saddened not only by your absence but by your perceived absent mindedness for not properly planning anything efficiently for their sakes. I updated my Health Care Directive too but saving this for maybe another blog.

When I first created these documents with a local attorney in 2008, I trusted her template and didn't question very much about it. I was impressed with her listening skills and forethought on our behalf whenever we did have questions or custom requests. The binder was oddly thicker from her, and I felt we were well covered, and so we signed it. It sat for fifteen years in place pretty airtight. Until this this year. I had learned more, felt more, seen more horror stories of failed Estate Plans gone wrong. So, I got to work and found a new attorney (my first had long since retired), and I spoke candidly with her about how we wanted to revise ("restate") the original one to bring about more peace of mind that my sons will be taken care of by us and not hurt by the potential actions, or inactions, or ineptness or selfishness of a potential new stepparent who may have no assets of their own and need to live off ours. Nope.

Neither of us can imagine ever getting legally hitched by paper again or trusting the likes of anyone who could turn out to be anything like the wicked and villainous Rosamund Pike in the 2021 film, "I Care A Lot," but then we can't know today what kind of state of mind or situation, or level of trickery could come to challenge our elderly or lonely selves decades from now. Again, we do trust our adult sons to look out for the team's best interests way more so than anyone else.

Maybe you have questions or thoughts brewing? Below are the ones I am commonly hearing from Club Friends, and I hope they help you too. Have additional questions? I'm not any kind of legal expert, but I'll give you my non-expert opinions if you ever want to contact me directly.

Or please leave a comment below, and your fellow Money Matters Club Friends and I, who all know there are no dumb questions, will chime in too to enrich this topic and educative discussion (commenting requires a sign-up membership with our Club though to weed out the trolls).

Who should create a Trust? You should. Especially if your net worth is getting ample, you own a home, property, a business, significant assets, collectables, things of value, and especially if you predict problems with who will be dividing your stuff up fairly, the way you'd have wanted, after you pass away, and one more especially: especially if you have loved ones/children you want to take care of, reward, enrich the lives of after you're gone.

Without a Trust, the courts will decide the outcome of your estate in a lengthy and costly process called Probate. The peeps or charities you really care for may suffer greatly for it. Don't let a lack of planning or knowledge let that happen to your peeps. If you think it will be some time before you can put a Trust and Estate Plan together, at least review all your holdings and complete all available beneficiary forms in your accounts now, and thoroughly (or go update them right now if you can't recall filling them out and aren't sure who's listed on them all; beneficiary forms typically exist online when you log into your financial accounts, if not, call your banks, custodians, insurance companies, etc. and ask how to update your beneficiary designations). I have never used them, but I'd probably vote that you consider DIY online genericized legal templates and a private notary, which would be better than doing nothing at all, if you can't do a custom Estate Plan with your own legal representation now. Then plan the life goal of one day advancing yourself into an Estate Plan with a custom Trust and other documents that suit you personally.

I can't afford the price of a Trust! Fair point. They're not cheap, save for the DIY or near-free path. However, if your employer offers Group Legal Insurance (such as Met Law), an insurance plan commonly offered by employers that offer its employees attorneys on retainer for a typically much lower annual premium (taken as a per paycheck deduction) than the very high cost (of about $2,000 USD on average or more) you can expect to pay for an Estate Plan when paying for an attorney on the open market on your own. Once your documents are in place, you do not have to continue to carry the insurance the next year (simply unenroll, else you may automatically carry forward into paying for another year, which may not be a bad deal if you should need the attorneys again for another eligible and covered legal matter). I'm pretty glad my coverage was portable as a retiree and for the same price I got when I was still employed.

What exactly is an "Estate Plan?" Well, I'm looking at mine right now. It's about 3/4 of an inch thick with printed papers, bound in a sleek see-through plastic cover. My attorney's card is in the pocket showing through (I'd be happy to share my new attorney's name too if you ask. She'd never crafted/notarized such a paragraph before apparently but was more than happy to do so for us with precision and some researching of her own to nail our vision, saying "you get to design your Estate Plan disposition instructions however you want.")

Its tabs marking the Plan's various sections read: Trust; Trust Certificate; Will(s); Advanced Healthcare Directive(s); and Power(s) of Attorney. These are each signed and notarized and will be considered legal and binding by anyone reading them/executing them from here on. My husband and I are the primary beneficiaries of this Trust while we're living. It sets up the ability for either one of us or both of us should we pass together to protect our net worth from other contesters, excessive and avoidable taxations, probate court delays and unnecessary costs, etc.

How often should I revise my Estate Plan? As often as would be worth it to you if its instructions are no longer representative of any one of your important wishes (your singular or plural). It's best to look at these docs every year at least once. Maybe designate your birthday or wedding anniversary or New Year's Day as good annual check point days. Or just do it anytime your family structure, situation, assets, holdings, wishes, health statuses, beliefs, should change.

What wisdom would you add to this topic? I want to know if you feel there's more I should have considered from your perspective, reader, and what other best-known methods you've got up your crafty money-savvy sleeves, my Club Friends!

Because money matters!

el

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E.M.Powers ("el") is a regular person with no particular financial credentials or expertise who happens to be a money enthusiast and the founder of The Money Matters Club, a virtual watercooler for like-minded individuals with a thirst for building their own financial health. Since 2006, she's helped thousands of co-workers build their financial literacy and wealth by participating in The Money Matters Club, a community she built on her employer's internal network. Since 2023, she's been attempting to scale The Club's reach through its second home on the World Wide Web. Her opinions--as well as the opinions of all participants--are just that: opinions, which are subject to flawed logic, math, typos and correction. She keeps a growth mindset and is also always learning something new or bolstering her own understanding after discussions at The Club. All information shared is done so with the best intent to inspire and empower others to learn more about money considerations toward building their own financial muscles. Nothing shared is meant as individualized advice that anyone should act on without doing their own curious research and personal decision making. There are no dumb questions at The Money Matters Club. Your financial health and literacy are what this Club cares about. All investing involves risk. All results can and will vary.

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