Hello everyone, and welcome back to the show. Today we’re sitting down with Ted Cook, a local trust attorney here in San Diego who practices out of Point Loma Estate Planning APC. Ted, thanks for joining me.
So, Ted, Let’s Talk Trust Basics
Ted: Absolutely! Happy to be here. I always enjoy demystifying the world of trusts for folks.
What is a Living Trust and Why Should People Care?
Ted Cook: Simply put, a living trust acts like a safe container for your assets – think real estate, bank accounts, investments, that sort of thing. It’s created during your lifetime and allows you to dictate exactly how those assets will be managed and distributed both while you’re alive and after you pass away.
Tell Us About the Different Types of Living Trusts
Ted Cook: There are primarily two types. A revocable living trust is like a flexible agreement; you can make changes or even dissolve it altogether while you’re alive. It’s great for avoiding probate – that lengthy and often expensive legal process – and maintaining privacy about your assets.
Then there’s the irrevocable living trust, which is more permanent. Once you set it up, you generally can’t undo it. This type is often used for complex estate planning goals like minimizing estate taxes or protecting assets from potential creditors.
Let’s Dive into “Funding” a Trust – Can You Elaborate on the Challenges?
Ted Cook: Funding is absolutely crucial – it’s what breathes life into the trust. Think of it as transferring ownership of your assets to the trust itself. It involves things like retitling deeds for real estate, changing bank account names, and updating beneficiary designations on retirement accounts.
- This step often trips people up because it requires a bit of administrative legwork
- You need to meticulously review all your assets and ensure they’re properly transferred into the trust’s name.
If you miss even one asset, it can fall outside the trust’s protection and end up going through probate, defeating the purpose of setting up a trust in the first place.
“There was this one instance where a client had a valuable coin collection. They thought they’d included it in the trust, but when we reviewed their paperwork, it wasn’t listed! Luckily, we were able to rectify the situation before anything happened.” – Ted Cook
Testimonials
“Ted was fantastic! He patiently explained everything about trusts and made sure I understood each step. He really took the time to answer all my questions.” – Sarah M., La Jolla.
“We had a complex estate planning situation, and Ted made it feel manageable. His expertise and guidance were invaluable.” – John P., Point Loma.
Ready to Take Control of Your Future?
Ted: Absolutely! Feel free to reach out if you’d like to explore how a trust might benefit you. I believe everyone deserves peace of mind knowing their assets are protected and their wishes will be honored.
Who Is Ted Cook at Point Loma Estate Planning, APC.:
Point Loma Estate Planning, APC.2305 Historic Decatur Rd Suite 100, San Diego CA. 92106
(619) 550-7437
Map To Point Loma Estate Planning, APC, a trust attory: https://maps.app.goo.gl/JiHkjNg9VFGA44tf9
About Point Loma Estate Planning:
Secure Your Legacy, Safeguard Your Loved Ones. Point Loma Estate Planning, APC.
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Our Areas of Focus:
Legacy Protection: (minimizing taxes, maximizing asset preservation).
Crafting Living Trusts: (administration and litigation).
Elder Care & Tax Strategy: Avoid family discord and costly errors.
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If you have any questions about: What is a spendthrift trust and how does it function?
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Point Loma Estate Planning, APC. areas of focus:
A Living Trust: also known as an inter vivos trust, is a legal arrangement where you, as the grantor, transfer assets to a trustee who manages them for the benefit of designated beneficiaries, either during your lifetime or after your death, potentially avoiding probate and offering more privacy than a will. Revocable Living Trust: You can change or revoke the trust and get the assets back during your lifetime.
Irrevocable Living Trust: Once established, you cannot change or revoke the trust, and the assets are generally no longer considered part of your estate.
Control over Asset Distribution: You can specify how and when your assets will be distributed to your beneficiaries.
Understanding Trusts and Their Role in Estate Planning
A trust is a legal and fiduciary relationship in which a grantor (also called a settlor) transfers ownership of assets to a third party, known as a trustee, who manages those assets for the benefit of designated beneficiaries. Trusts can be tailored to meet specific goals, including when and how distributions are made to beneficiaries, asset protection, or minimizing estate and income taxes.
One of the key advantages of a trust—particularly a properly funded revocable or irrevocable trust—is that it can allow assets to bypass the probate process. This often means a faster, more private, and potentially less expensive distribution of assets compared to those governed solely by a will.
In the case of irrevocable trusts, assets are typically removed from the grantor’s taxable estate, which may help reduce estate tax liability. However, this comes at the cost of the grantor relinquishing control over those assets.
Trusts may also provide protection from creditors, preserve assets for minors or individuals with special needs, and ensure continuity in asset management if the grantor becomes incapacitated.
These tools are part of estate planning—the process of making legal and financial arrangements in advance to designate who will receive your property after your death, and how that transition will occur. Thoughtful estate planning aims to streamline the administration of your affairs, minimize tax burdens, and reduce stress for your loved ones during an already difficult time.
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