Trust Reviewsfor Advisors

Presents:

www.wilseylaw.com

The Revocable Living Trust

Your Gateway into

your Client’s

Heart and Family

Why Review a Trust

Trust may be inadequate– Trust mill– Misses on key opportunities

Trust may be stale– 71% of HNW client’s plans are older than 5 years

Trust may not address clients unique situation Trust may not have changed with the client’s life

WIFT (What’s in it for Them)

Estate Planning is often what your clients care most about

They have no way of knowing whether their plan is sufficient

Most people think that because they have a Revocable Living Trust their family will be protected

Your Clients depend on you as the quarterback of their Financial Situation

WIFM (What’s in it for Me)

Bond with your Clients Gain more credibility with your clients Have greater access to assets

– Get more assets under management

Address planning issues that lead to production– Life Insurance– Disability Insurance– Long Term Care

Great intro into Retirement Benefit Plans

The 10 Revocable Living Trust Keys™

1. Avoid 100% of Death Probate Fees

2. Avoid 100% of Lifetime Probate Fees

3. Health Care Decisions in the Event of Incapacity

4. Protect Minor Children

5. Minimize Estate Taxes

6. Provide Asset Protection for Surviving Spouse

7. Protect against Surviving Spouse Remarriage

8. Protect Children from Losing Inheritance

9. Prevent 2nd Estate Tax

10. Comprehensive Estate Plan

Avoid Probate

Trust must be funded to avoid probate Most Trusts are not funded completely Most Trusts will not avoid probate

Why this is important

This is a great way to ensure that you have access to all your clients assets

Do funding reviews Look at all account statements, grant deeds,

etc. See if they are titled in the name of the trust You will be able to capture more business

Provide for Incapacity

Disability Trustee– Manages trust assets in event of disability– Will often be different than Post-Death Trustee

Wrong to determine incapacity According to State Law

Right Way to determine incapacity Spouse and Physician Two Physicians Disability Panel

Why this is important

Long Term Care Insurance?– You are 6 times more likely to become

incapacitated then die in any given year– Nursing Home costs can decimate an estate– Good way to protect family

Protect Minor Children

Guardianship Nomination– Post Death Guardians– Disability Guardians– Temporary Guardians

Common Pot Trust– Don’t split shares until children are a certain age– Treat children like the parents would have

Proper Planning for Grandchildren– GST– Trust for Grandchildren

Why this is important

Life Insurance 529 plans Gifting Trusts for Kids

Estate Tax Reduction

Trust will split into three parts at death of first spouse– Survivor Trust– Bypass Trust

Marital (QTIP) Trust– Usually left out of equation

Why this is important

Wouldn’t this be the perfect opportunity to talk about using life insurance as an discounted way to pay the estate tax?– Use someone else’s money to pay the estate tax– But keep control of the cash in the policy

Spousal Gifting Trusts

Provide Asset Protection for Surviving Spouse

QTIP and Bypass Trusts– If properly drafted, spouse will not be able to lose

assets to creditors, lawsuits, remarriage and divorce, etc.

You can also protect the kids against a future remarriage by requiring a pre-nup or cutting off spouse entirely

Why this is important

Wouldn’t this be a good place to talk about using a corporate trustee with the surviving spouse to assist with accounting, tax returns, etc.?

Retain assets

Protect against Surviving Spouse Remarriage

Most Clients will want to protect their children in the event their spouse remarries

Think of trust as 2 parts– H’s assets and W’s assets

Protect Children from Losing Inheritance

Squandering an Inheritance Losing an inheritance to creditors Losing an inheritance to a divorce Losing an inheritance to a bankruptcy Fighting with each other

Why this is important

This is the single greatest key to establishing yourself as a different kind of advisor

No trust you will review will include asset protection. NONE

This is a great place to talk to your clients about protecting their own assets

– Spousal Gifting Trust– Asset Protection LLC– Insurance Trust

Prevent the IRS from Getting a Second Estate Tax

Generation Skipping (“Dynasty”) Planning Uses GSTT Exemption to carve out trusts

that are designed to pass free of estate and GST tax to future generations

Kids use up non-exempt assets for their use

ADVISOR ALERT

Life Insurance is a great tool for multi-generational planning because you can leverage the GSTT Exemption

RLT is Part of Comprehensive Estate Plan

For Wealthy Clients, RLT is never enough– Asset Protection Planning– Charitable Planning– Life Insurance Planning– Estate Tax Planning– Foundation Planning

These are all ways to get more assets, and generate more planning revenue

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