Need ideas on wills, trusts, financial planning

[forHISglory]

We are in our 60s, house paid off, no debt, good savings, and retired with pension. Now we are looking to redo our will and make plans for inheritances. It just seems to be that time of life! We have a will now, but it is very out of date, so we think it is a smart move to change things now.

We are not rich; we don't have a million dollars to divvy up. But we want to make wise decisions with what we do have. We've spent years of hard work to come to this point, and don't want it wasted.

Here's some of our concerns, and we would appreciate any feedback, opinion, advice, or experience that you can give us. We have not completely thought through these ideas....

1. Education of grandkids. First off, we are not interested in paying for our grandkids' complete education. Both of us paid for the majority or all of our own education and I think we are better off for doing that. But with that said, we would like to offer incentives for the grands to complete their education. Here's what we have considered: We will match whatever scholarships each grandkid gets, say, up to $1000 per semester. That money will go into an interest bearing fund. At graduation, the grandchild will receive that money to use as he/she begins a career. That would be about $8000 per child. Any thoughts.....

2. Donation to church. During our lifetime, we give a minimum of 10% to our church. We'd like to donate 10% of our estate to whatever church we might belong to at the time of our deaths.

3. Income stream/trust. Our thinking is a little vague here, but we like the idea of the inheritance going to the heirs a little at a time, and not in a lump sum. The majority would go to our son, but would also like to have some going to the grandkids. We are thinking of perhaps having the grandkids' parts held until they are of a mature age. Any thoughts on how to do this? For our son, we are thinking of a generous amount up front, and then some type of income stream, perhaps a yearly amount, coming from the trust. Any thoughts?

Thanks for the feedback!

[frugalfranny]

This can be a tough call since we don't know your states laws.

I take it from reading that you only have one child..........and if more, and you plan to leave them out, you should mention them in the will and state such.

Sounds like you might be paying someone to handle your funds over the time since you aren't giving it all at once......again, check your state laws.

Who is your executor? In some states that can be tricky if the "executor" will also be getting an inheritance.......esp. if it is the major portion.

The kids and school would be fine but I was a little confused over it. Why not just say X amt. of dollars when school is completed....or at such and such an age. Is this to make them try for scholarships?

Almost anything can be done in a will..........and a good atty. can help with it that know your state laws.........usually pretty cheap. But if a trust is set up then you could have to pay for handling such......which can eat profits.

[forHISglory]

FF, I appreciate your response.

Yes, we onlyl have one child.
Have not yet thought of executor.
About kids and schooling: yes, we wanted to motivate them to work and get scholarships. All of them are highly capable.
Will have to consider whether it is better to pay someone to handle a trust or to not have a trust.

Glad you replied!!!

[frugalfranny]

FF, I appreciate your response.

Yes, we onlyl have one child.
Have not yet thought of executor.
About kids and schooling: yes, we wanted to motivate them to work and get scholarships. All of them are highly capable.
Will have to consider whether it is better to pay someone to handle a trust or to not have a trust.

Glad you replied!!!

Our area will often have these 'seminars'........and while they ARE selling something I have gone to a couple of them and learned things. I just leave when they start doing the 'sign up'.....

And what the heck............they always feed you!!

Try to catch one in your area.

I feel that one important factor.....depending on your state and that could even change by the time you are gone...........but do what you can to avoid estate taxes/inheritance taxes and anything else they tack on to any $ passed down...........that is the killer.

You can do anything you want...........it is how the LAWS will affect it that might change your mind.

And while you are doing the paperwork..........don't forget your LIVING WILL..............and power of attorney papers............very important if you become incapacitated.

[McD]

FHG---have you looked into the 529 plans available in your state? We have accounts for each of the kids and in terms of tax benefits, they are great. https://collegesavingsiowa.s.upromise.com/

They may not suit your needs, but certainly check them out!

[forHISglory]

Sounds like I need to do some research into our state's laws. Thanks for the heads up!

Also, we thought it would be better to put most of the will's language into percentages instead of set dollar amounts. We have modest means, and who knows, we may end up having to use part of the savings ourselves. So instead of saying "$5000 goes to the church", we would just say "10% goes to the church." Any thoughts on that?

[shoiji]

A trust fund sounds like a great idea. I knew someone on disability who had a very small trust fund. It did not seem to cause problems with any other benefits she received. But it was a small trust fund and she received a small amount from disability.

One thing I do remember my grandmother doing was saying to the whole family to think about what everyone wanted from her house. That she wanted to make sure everyone received something they wanted when she passed. That she would put a name on what everyone wanted. Fortunately us grandchildren were old enough at that time to understand. In some ways it was interesting to see what everyone picked out and why. At the end her house had little notes on various things.

But it was a wonderful way to make sure everyone had something special to remember her by and there was not any question on who received what.

[Sophiasmama]

Depending on your state laws...in the will you can put 10% of estate to go to X church with the address and info. As for excutor...I'm in Canada so keep that in mind...I was told by our lawyer it is wise to pick a person who will not gain funds from the will...but that said I'am the excutor to my mom and dads will...and that estate is worth 8 million...to be divided up equally between my brothers and I...but as my parents are 51 years old...they have alot of life left...I hope they spend it all!!!! GL with your desicion. Janine
I should add that the reason why I'm excutor is I'm the oldest...and most responsible out of my brothers...and there is no hard feelings about it.