In my experience as a Charlotte trust attorney, I’ve actually found that the best place to start is by going through the general qualities that a trust administrator should possess.  From there, you can think through your list of family and friends and choose someone whose personality and financial savvy make them the right fit for the job.

1. Trustworthy

One of the most important qualifications (in my opinion of course) is trustworthiness.   This is an essential requirement, considering your administrator will be privy to all your financial information and will manage your estate upon your passing.  You should feel confident knowing that your administrator will distribute your assets and manage your affairs as you’ve indicated, rather than use the proceeds of your estate as if it were their own personal bank account.  Thankfully, there are a number of laws intended to keep this type of financial abuse in check, but it still does happen and it’s hard to recover the proceeds of someone’s estate once they are gone.

2. Fair-minded

Fair-mindedness is another trait a trust administrator should possess. Throughout the administration process, you’ll want your beneficiaries to be treated fairly and equally.  You don’t want to run into a situation where someone you’ve appointed shows favoritism towards certain family members and distributes your assets accordingly.

3. Loyal

…to the trust and to the heirs. In a way, he or she is the keeper of the final wishes, and part of their job is ensuring that these wishes are carried out as set forth in the will or trust.

4. Strong-minded

Finally, you’ll want to choose an administrator who is strong-minded and cool under pressure. Following the death of a loved one, emotions can run high among the heirs. A favorite gravy boat can take on epic proportions when everyone thinks it should go to them. Sometimes greedy beneficiaries believe their share is short. Other times, heirs think they should be getting their money immediately, either not realizing (or caring) that debts, liens, and other considerations have to be satisfied before any funds can be distributed.  Tensions can run high and your administrator should be prepared to keep such squabbles in check should fights break out regarding the terms of the trust.

While choosing a trust administrator is no doubt a tough decision to make, we are here to help guide you through the process.  Please do not hesitate to reach out to us as a resource if you need assistance setting up a trust and ultimately choosing an administrator to manage your estate upon passing.  Simply call our Charlotte estate planning office at (704) 843-1446.

1. both pass along specific assets,

2.  both name guardians,

3. both are written,signed and witnessed;

4.  both can be amended and revoked.

The differences between both are what sets them apart:

A Last Will and Testament, appoints an Executor who then takes the original Last Will and Testament to the Probate Court after the person dies. The assets are then collected and distributed according to the directions in the Last Will and Testament.  There are North Carolina Probate Court rules and regulations that need to be followed by the Executor once he or she has been appointed.  During the lifetime of the person who created the Last Will and Testament, the title of assets are not changed.  However, the names of beneficiaries may need to be changed to keep everything consistent with the Last Will and Testament.

A Revocable Living Trust appoints a Trustee and a Successor Trustee. This person manages the assets in the trust after death.  If done properly, a Revocable Living Trust will avoid probate. How?  Because the title of assets (not all) will be changed to the name of the Trust.  This is called Funding the Trust.  If the asset is not in the name of the person who died, then there is nothing to probate.  Ultimately, avoiding Probate.

I must caution you that there are certain assets that should not be titled into the name of the trust and there are beneficiary designations that must be changed in order for the Revocable Living Trust plan to work.  You should consult with an attorney, a financial planner and a CPA prior to making any changes – if you don’t you will run the risk of unwanted tax liabilities.

“What is the Difference Between a Last Will and Testament

and  a Revocable Living Trust?”

Checking Accounts/Savings Accounts/CD’s/Stocks/Mutual Funds: The name of the current owner on these assets will change to the name of the Trust.  You will probably  have to do this in person for checking accounts and savings accounts as the bank will want you to sign a new signature card.  Instead of signing the checks as Joe Smith you will sign them as Joe Smith, Trustee.  Before doing this with your CD accounts, check with the bank if they will impose a penalty if you transfer it before the period has run.

L ife Insurance: You will remain as the named owner on the Life Insurance Policy.  You will request that the Revocable Living Trust be named as the beneficiary.

Annuity:  It is recommended that if you are married that the spouse remain as the primary beneficiary and if you have children, they should be named as secondary beneficiaries.  This is due to the fact that there are certain options available to a spouse that are not available to a Living Trust.

IRA: If between a husband and wife, then  the ownership must remain in the name of one of the spouses and the primary beneficiary as the surviving spouse.  The Revocable Living Trust can be made the secondary beneficiary.  You MUST check with your CPA to determine if there are any income tax consequences to these changes.

Personal Property: Typically any property that does not have a physical title (such as household furnishings, jewelry, clothes, etc.) is handled by a document called “Assignment of Furniture, Furnishings and Personal Effects”.  This document is signed at the time your Revocable Living Trust is signed.  Not only does it transfer the assets you currently have into the Revocable Living Trust but it also transfers any future property of that nature.

Real Property:  The deed will be re-recorded with the name of the Revocable Living Trust as the owner.  You should contact you insurance company prior to making this change to determine if they will allow a Revocable Living Trust to be a secondary insured on the policy.  You should check with your mortgage company as well.

Insurers and individuals who suffered losses in New York Yankees pitcher Cory Lidle’s fatal plane crash in Manhattan in 2006 have agreed to accept $2 million and drop the pursuit of almost $60 million in property and personal injury claims against the estates of Lidle and his flight instructor, a mediator in the case said Tuesday.

The claimants accepted the $2 million because Lidle, 34, and the instructor who died with him, Tyler Stanger, 26, had $1 million liability policies each, and the estates had no other assets worth pursuing, says Michael Cohan, who assisted the mediator in the case, retired New Jersey Superior Court Judge Marina Corodemus.

Investigators never determined which man was at the controls when they attempted a turn over the windswept East River on Oct. 11, 2006, in Lidle’s Cirrus SR-20 aircraft and slammed into a high-rise apartment building. Some residents were injured, debris rained down on pedestrians and property damage was in the millions.

Lidle had obtained his pilot’s license earlier in the year and the National Transportation Safety Board ruled that the pilots’ inadequate planning, judgment and airmanship in trying to make a 180-degree turn led to the crash.

Cohan, of counsel to Corodemus & Corodemus in Iselin, N.J., says the $2 million will be split among insurance companies that paid $16.5 million to 11 property owners, six property owners who had further claims and five personal injury plaintiffs.

He says Circuit Judge John Laurent in Polk County, Fla., the probate judge of Lidle’s estate, approved the settlement on Sept. 22, but has not ruled on whether to release Corodemus’s report, which contains a breakdown of the distribution of the $2 million.

“No one wanted to go after the personal assets of the estates,” says Gerald Kirby of Feldman, Rudy, Kirby & Farquharson in Westbury, N.Y., who represented Allstate Insurance Co. and Encompass Insurance Co., which were seeking recovery for property damage claims they paid.

Kirby says his clients paid claims of more than $1 million. Asked how much of that they will receive in the settlement of the subrogation claims, he says, “peanuts.”

Cohan says Corodemus was called in as mediator at the suggestion of the lawyer for the Stanger estate, Eugene Massamillo of Kaplan, Massamillo & Andrews of New York. Cohan says Massamillo, who did not return a call for comment, was familiar with Corodemus’s work as the New Jersey state court judge in charge of mass tort litigation for 10 years before her retirement in 2004.

Cohan says one personal injury claimant, whom he did not identify, did not accept the settlement.

Lidle’s widow and Stanger’s estate have filed a product liability suit in California against the aircraft’s manufacturer, Cirrus Design Corp.

The greatest fallacy most people have about estate planning is the belief that if they die intestate (or without a will) all of their property will go to their spouse.  In fact, it is this belief that keeps many people from creating an estate plan until after one spouse dies.  But this is not necessarily true.  What happens to your estate depends on many factors, including the state in which you live, whether you have children, your marital status and whether you’ve been married before, etc.  There is absolutely no one answer to the question “What happens if I die without a will?” Are you sure you want to take your chances with what might happen?

Another issue that most people just don’t understand is that probate is more often than not a very time consuming and expensive process.  There is a good likelihood that your loved ones will need access to your estate in the months following your death—unfortunately they are not likely to get it!  Probate court calendars, informing creditors, looking for other possible heirs, other family members contesting decisions—all of these and more can keep your estate tied up in probate for months or years, and unavailable to the people who need it most.

And perhaps the least understood drawback to refusing to create an estate plan in a down economy is that the probate courts may force your heirs to sell valuable assets at a time when property values are at their lowest. This alone could result in significant losses to the estate you pass on to your beneficiaries, not to mention probate fees and estate taxes that could have been saved had you planned ahead.

Estate planning may feel like an unnecessary expense, but the more you understand the more you realize just how essential it is.  Creating your estate plan now could be the best investment you make in your family’s future.