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[quote=Anonymous][quote=Anonymous][quote=Anonymous]Net value of around $2 million, we have two adult kids. We're trying to update an old will but all the lawyers are telling us we should get a trust. Apparently trusts cost $6000+, which is not in our budget. Why do we need even need a trust or a will? Why can't we just name our kids as beneficiaries on our bank accounts and retirement accounts, write a letter telling them to sell the house and then divide everything up 50-50? [/quote]

Read the book, "Beyond the Grave: The Right Way and the Wrong Way of Leaving Money to Your Children (and Others) by Jeffrey Condon for an understanding of why a trust is in everyone's best interest. At the bare minimum a will, but a trust makes things so much simpler for your kids, avoids probate, and ensures the bulk of your money goes to your heirs and not taxes. My husband and I went through the process of creating a trust last year - it's a bit of homework to get everything in place, but the peace of mind is priceless.[/quote]

Unless you're setting up an irrevocable trust (which is more complicated and has drawbacks of its own), having a revocable trust vs. a will has zero tax advantages.

The only thing a revocable trust does is avoid probate, IF you set it up and title all your assets correctly. That's a benefit if you live in a state where probate is difficult (i.e., California). In most states, probate isn't a big deal. The hassle of being an executor is sending out death certificates to banks, etc, and a trustee has to do that part, as well. Further, a trust is not a panacea -- when things get contentious, a trust can be more of a mess than probate. [/quote]

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