Williamson & Gentilini
Attorneys at Law
1945 Palo Verde Ave., #101
Long Beach, CA 90815
How Does a Trust Work?
A Living trust is a revocable trust that is
set up during your life. Living trusts are also commonly
referred to as "revocable trusts," "inter vivos trusts," and a
host of other names. Basically any revocable trust is a
A living trust is a separate legal
entity created through the appropriate legal documents to hold
assets. Once created, the goal will be to make sure your assets
are titled in the name of your living trust. You, as the Trustee
of your living trust, maintain complete control of the trust
(and assets) during your life and can add or remove assets as
you wish. Upon your death, the assets in the trust are
distributed by the successor trustee (usually your spouse or
another loved one) to your named beneficiaries. All assets in
the trust will pass to your named beneficiaries without
having to go through the probate process.
Many people refer to a living
trust as their estate plan. This is incorrect. A living trust is
actually a single document - and is just one part of an estate
plan. Good estate planning takes more than just a living trust.
The following is a brief description of each of the documents we
include in our estate plans:
- The Living Trust
A living trust is a separate legal entity created through the
appropriate legal documents. A well drafted living trust is
usually rather lengthy. In it you spell out how you would like
the assets of your trust (your property) handled or
distributed in the case of your incapacity or death. This is
where you will name your successor trustees and beneficiaries
(heirs). Essentially, this is where your wishes and desires
regarding your estate are detailed.
- Summary or Synopsis
The synopsis is summarized version of the main provisions of your living
trust. The summary includes quick references to trustees,
beneficiaries, disposition of property and more. The fact is
that most people do not have the patience or desire to
understand the legal language and mechanics of estate
planning documents. A good summary or synopsis is essential.
- Trust Certifications
Since a trust is a separate entity, most banks, investment
companies, and County Recorder, will need a copy of the trust
to open or close accounts or transfer property. You can
provide them with a copy of the actual trust, but all they
really need is the authorizing information contained in a
Trust Certification. By providing a trust certification
instead of the copy of the trust, you keep your privacy.
- Pour Over Will(s)
The purpose of a pour over will is to provide testamentary
instructions that all assets inadvertently left outside your
living trust be "poured over" into your living trust. Keep in
mind that the goal is to have all the appropriate assets
inside the living trust so that probate is completely avoided.
Nevertheless, this document serves as a safety net or
catch-all in case any assets remain out side the trust.
- Assignment of Personal Property
You may own many untitled items such as furniture, clothing,
jewelry, and such. These items can be transferred into the
trust by use of an assignment of personal property.
- Durable Power of Attorney for Business
In addition to the living trust you will also need a durable
power of attorney.
The purpose of this document is for you to name a person,
usually a spouse or loved one, that you authorize to conduct
your affairs should you become incapacitated or otherwise
unable to handle your affairs yourself. This document is
sometimes called a "springing power of attorney" because
the "power" granted to the person you name "springs to life" only
in the event of your incapacity.
- Durable Power of Attorney for Medical
Like the Power of Attorney for Business Affairs, the purpose
of this document is for you to name a person, usually a spouse
or loved one, that you authorize to make medical decision on
your behalf should you become incapacitated or otherwise
unable to make your own decisions.
- Advance Medical Directive
The purpose of an advance directive is to provide instructions
to your medical doctors regarding the withdrawal of treatment
and/or the ending of your life if you are irreversibly
terminal or brain-dead.
- Nomination of Guardian for Minor Children
In situations where the appointment of a guardian for minor
children become necessary, this document instructs the court
who to appoint.
- Situation Specific Documents
In addition to the main documents above, each estate and
family situation will dictate additional documents that are
necessary. This is exactly why it is important to discuss your
estate planning needs with a qualified estate planning
attorney. This is also why each estate plan we do starts with
an in depth attorney-client consultation.
In the first consultation meeting with a new
client, either attorney Williamson or attorney Gentilini will personally take the time to
fully explain each of these documents, why they are needed, and
how each one works. It is important to us that our clients
actually understand their documents and are comfortable with
their estate planning.