avoiding probate and liquidity

avoiding probate and liquidity

The two dragons that together can lead to time and expense as well as increase the chances of family conflict, is where assets must enter the probate process. This requires, filing fees, appraisals, accounting, attorney fees, and waivers often by relatives in the process.  In the well drafted trust where the client properly transfers assets as required to the trust, the assets go into the trust and are distributed and held by the trustee pursuant to the terms of the trust. This is a particularly useful vehicle in dealing with real estate. 


Compounding the probate issue is the problem of liquidity. If the estate consists of real estate or of at risk and securities where there are capital gains and transaction fees the estate can face liquidation of some assets with accompanying expenses.


With a trust where there is insurance in which the trust is a beneficiary, this can solve a number of problem.


The need for liquidity to preserve assets and avoid loss of estate value is well addressed by life insurance, FFIUL and various annuity programs.


I invite representatives to weigh in as to how they would incorporate these ideas into their practice..


Fred Kass Columbus Blakely Agency [phone number removed by moderator]




Re: avoiding probate and liquidity

Thank you for proposing this discussion for fellow professionals @frederickass! I don't know how deep the pool is just yet in this community for Financial Professionals but I want you to know how much we appreciate having you here. Welcome. Smiley Happy

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Re: avoiding probate and liquidity

Hi @frederickass, what would a consumer do to establish such a trust? Do I need to work with my financial advisor or my tax accountant? Should I go to a lawyer? And at what level is it worth considering a trust? I am assuming if I only own my own home and have some basic 401k or savings, a trust might be too much work?



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