michigan estate planning attorneyThere are many people who are unsure about what a Living Trust really is. It’s a lot like the little red wagons we used to pull behind us when we were kids. We could put whatever we wanted into our wagon and likewise could take everything out.  We decided what went in, what came out, where it went, and who could use the “stuff” in it.  When we were done playing with our little red wagon, we decided who could play with it and all the stuff that it carried. Think of a Living Trust as being just like your little red wagon. 

So, imagine everything you own is represented by a box.  Your house, investments, bank accounts, vacation homes, life insurance, whatever you own is in a little box. Imagine that you have all these boxes and as you move throughout life, you carry all your boxes with you.

Now, what happens if you become disabled or incapacitated? What happens when you die? What happens to your stuff, or your boxes? If you are no longer carrying them, they will fall to the ground and scatter. Now, how do your loved ones find a way to pick your boxes up? There are only two ways to do it. The first option is through the Probate Court system.  The other is through proper Estate Planning.   If the Courts are involved everything will be done pursuant to the State’s rules and guidelines and you, or your loved ones, must get the Court’s approval to do anything.  This process is also open to the public, so anyone can see what you have, what it’s worth, who it’s going to, and when.  Through proper Estate Planning and the creation of a proper Trust, you can put all your boxes into your little red wagon.  You can appoint someone to pick the handle of your wagon up, manage the boxes in the wagon and distribute your assets in a private manner.  The Courts do not need to be involved at all.  If you are disabled or incapacitated your designated Power of Attorney will pick up the handle to your wagon and administer your “stuff” the way you instructed in the Power of Attorney, but they can only do this during your lifetime. A power of attorney is only valid while you are alive. If you are not alive, the executor of your will or your successor trustee can pick-up the handle to your wagon and thus control your boxes.  If your estate plan is not in order, only after all probate matters have been settled can an executor pick up and deal with your boxes as they are ordered to by the Court.

What if you didn’t have to worry about that at all? What if you took your boxes and put them inside your little red wagon? Wouldn’t it be so much better if you could walk around the playground of life with a lighter load, knowing you and your stuff will be taken care of the way you want it to?  Then, if you become disabled or incapacitated or pass away, your boxes, or your “stuff,” will not fall and scatter. Your boxes will stay safely tucked away in your little red wagon. And, attached to the handle of your wagon will be a book of instructions known as your estate plan.  The instructions, or your estate plan, will tell everyone, including the Courts, who can pick up the handle to pull the wagon, who is permitted to put things inside, what is permitted to come out of the wagon and who will benefit from the contents and when.

The instructions that are attached is your Trust and the accompanying estate plan and will dictate who is in control of the assets inside the wagon when you are done playing with them. This person is what is called your successor trustee. If you are alive, you are the trustee of your wagon. If you pass away or become incapacitated or disabled, you now have detailed instructions as to who gets to do what with the assets in your wagon. Those instructions let the people who are pulling your wagon know where they can go, who can take stuff out, when they can get it, and how. We leave all those directions behind contained in the estate plan. We can even instruct your loved ones who you think they should work with to assist them in this undoubtedly trying time. It is your guide and rule book.

So, if you have a rulebook, an estate plan, and we put everything in your little red wagon, a trust, it will dictate who’s in control and when and how people have access. And who in control? Your successor trustee(s).  And does it need probate?  No, it stays private. Your successor just follows your rules!

Remember, it’s either open to the public following the rules and guidelines within the Probate Court, dictated by the Judge and the laws and rules of the State, or it can follow your rules and instructions through proper estate planning.  We are here for you and can help you construct your rule book, put your assets into your little red wagon, and how best to handle your estate and plan for you and your loved ones' needs and wishes. 

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