LOOKING TOWARD THE FUTURE
Lonzo Lucas, Judge (ret)
Alice Walker, the author of The Color Purple, recounts, “In those long midnight hours when morning seems like weeks if not years away, the words of Howard Thurman have kept watch with me.” Howard Thurman, minister, philosopher, and educator, at the time of his death in 1981, had taught and lectured at over five hundred institutions and around the world. He wrote more than 21 books of spiritual discovery and inspiration.
In his book, For the Inward Journey, he shares an experience in his life. As he walked across a field in La Grange, Georgia he came upon an old man planting pecan trees. The little trees were not more than two and a half to three inches in height. Why did you not select larger trees so as to increase the possibility of your living to see them bear at least one crop of nuts? Dr. Thurman inquired.
With a gaze that took in the totality of Dr. Thurman’s features, the old man replied, these small trees are cheaper and I have very little money. So you do not expect to live to see the trees reach sufficient maturity to bear fruit. The old man replied no, but is that important, all my life I have eaten fruit from trees that I did not plant, and besides the man who plants because he will reap the harvest has no faith in life.
The truth of the matter is, much of life is made up of reaping where we have not sown and planting where we shall never reap. Now in exactly this way, let us consider another dimension in the brotherhood of man, that is the disposition of our future interests and our assets. In that regard I shall share a few tips and insights on the administration of a living trust.
Generally, the post death administration of a living trust is much easier and less cumbersome than that of a probate. In each situation, many of the same events occur. The descendent’s debts, expenses and taxes are paid and the balance is distributed to the descendents named beneficiaries. The main distinction is that if the decedent (the person who makes a will/trust and dies) has properly transferred his/her assets into the trust, there is no probate action required, and that will save the beneficiaries a plethora of headaches and problems. It is important to note that probate court and related fees, which are based on the dollar value of the decedent’s assets or estate, are given to the beneficiaries. Note that the larger the probate estate, the greater the probate fees and statutory fees and expenses will be.
Let me hasten to point out that there are a few common misconceptions about living trusts. Firstly, that if a living trust is in place, estate taxes can be minimized or avoided. This is clearly not true, it is possible to take planning steps to reduce the size of your estate prior to your death, and this can be done through life insurance.
Yet another misconception is that with the use of a living trust, attorneys and accounts fees are avoided. I find that in most cases it will be necessary and good common sense to retain an attorney and an accountant to assist in the post-death trust administration. While the fees may be less than they otherwise would have been if there had been a probate, some trust fees will be incurred.