What will happen to your assets when you die?

In the same vein of our recent "news you can use" articles on umbrella insurance and the TreasuryDirect program, today we focus on two important (and under-utilized) estate planning tools: wills and living trusts.

Wills and living trusts make sense for those who are married, have children, own real estate, have financial or other material assets, and/or wish to influence how their estate is distributed after their death. I'm guessing the vast majority of folks reading this fall into at least one of these categories.

Yes, this is morbid territory to tread into. But it's important.

A few months ago, right after I published What Really Matters, a good friend died suddenly of a heart attack at age 42. There was no warning. He was a former college athlete, still-fit, and died on the basketball court during his weekly practice. He left behind a wife and three children, one with life-long special needs.

Fortunately, my friend was a lawyer, and had practiced what he preached professionally. He had put a well-constructed estate plan in place while alive (along with a healthy life insurance policy).

I saw first-hand the great benefits this gave his family upon his sudden passing. They were able to fully focus on dealing with their grief, as the estate plan largely took care of all the legal and financial details in the background.

If you've had an immediate family member or close friend pass away, you're likely aware of the tremendous number of tasks and decisions that need to be dealt with when someone dies. Aside from the obvious treatment of their remains and funerary arrangements, the deceased's estate needs to be settled.

This means an executor needs to be appointed who will manage the process, creditors need to be paid as will any estate taxes, heirs need to be identified and assets distributed among them (which in many cases requires selling/disposition of these assets first), care for minor children needs to be arranged, etc. This process is oftentimes managed by the state (i.e., slowly and often inefficiently).

This is an awful lot to put a surviving spouse through (assuming there is one) during a time of extreme grief. The same goes for children.

And this burden gets compounded if there's no estate plan in place. What assets did the deceased own? Where are they? Whom did he/she want to inherit them? All of these questions need to be answered during the estate settlement process.

Imagine trying to untangle all this right after your spouse, parent, sibling or friend has died. When you're already emotionally traumatized.

Now imagine that the heirs involved don't agree on how the estate should be divided, and infighting ensues. Relationships can easily get permanently damaged and money quickly drained should expensive lawyers get involved to contest the matter. The situation often gets very ugly, very quickly. (Click here for a sampling of horror stories resulting from when folks died without a will.)

Why risk putting your loved ones through this? Especially when it's so easily avoidable, and relatively inexpensive to do so?

Look, every one of us is going to die. That's the only rock-solid guarantee we're given during our time on Earth.

You've worked hard your whole life to take care of those important to you. Don't drop the ball on the 1-yard line. Take care of them in your death, too.

Wills & Living Trusts

The bedrock of a good estate plan involves a will and a living trust. I'll explain the role of each, the differences between the two, and the wisdom of having both.

NOTE: What follows is a summarization. While wills and living trusts are fairly simple conceptually, there are lots of special cases. Many of those are not addressed below so as not to prevent this article from becoming densely encyclopedic. Also, I am not a lawyer -- meaning: take this synopsis as education, not personal legal advice. If you want that, consult an estate lawyer.

OK, with that out of the way, let's proceed.

Will

Most folks are familiar with the concept of a will. Every murder mystery usually has a scene where the family gathers at the lawyer's office to hear the reading of the late victim's will: "Being of sound mind, I hereby bequeath to my nephew, Chauncey, my collection of rare Amazonian butterflies..."

Simply put, a will is a legal document that specifies:

  • how you want your assets distributed upon your death,
  • whom you grant the power to oversee that distribution (i.e., your "executor"), and
  • whom you want to have guardianship of your minor children, should there be any

Sounds like something every responsible adult should have, right? I agree.

But amazingly, 63% of US adults do not have a will. And an additional 9% have a will that's no longer up to date. Even among the more affluent, 45% do not have a will.

So those ugly issues I mentioned above of what can happen when you die without a will? They're very real and actually happen a lot.

Which is criminal, as a will is a straightforward document that shouldn't cost you more than a few hundred dollars (at most) and a few days to create (I'll give more specifics on the will creation process in Part 2). There really aren't any good reasons why the vast majority of us, especially those with minor children, shouldn't have one.

The key downside to note with a will is that it's subject to probate. Probate is the judicial process that determines the validity of the deceased's will. None of the instructions laid out in your will can be undertaken until a court accepts its validity and "grants probate" to your specified executor.

Probate isn't much fun. It takes time: typically a few months, but it can last years in certain cases. It can be costly: expect to pay somewhere between 3-8% of your estate's assets in combined attorney, court and other fees.

Probate can be challenging for real estate, especially investment properties. Until these assets have passed probate, your heirs (including your spouse) cannot manage or dispose of them. They're locked in limbo, which can get quite inconvenient if the probate period stretches for many months or years.

It's also a public process. During the probate period, your will is made available upon request to anyone who asks for it. So the details of your estate and your disposition wishes are not kept private. And your will can be challenged in court during this time by anyone who feels they have a valid claim on your assets.

Which brings us to Living Trusts...

Living Trusts

A trust is a legal arrangement in which one or more people manage or take care of property for someone else's benefit.

There are several major benefits you can enjoy by placing your assets into a trust to manage them while you're alive (that's why it's called a "living" trust). One of them is avoiding probate upon your death.

Once your assets have been placed inside a living trust, they're managed by its Trustees on behalf of clearly-specified Beneficiaries. So with ownership transfer, executorship and distribution are already worked out -- the probate court doesn't need to get involved.

For most couples, this allows the surviving partner to retain seamless control of all Trust assets after the other dies. The assets don't go through the probate process, there are far less fees involved, and the process is private. (The estate still can be contested, though. But the details of the estate's assets don't have to be made available to the public upon request.)

Avoiding probate is just one of the advantages offered by living trusts.

Another big one is (potentially) reducing estate taxes. I'll spare you the wonky details for now, but there are ways for your trust to take advantage of deductions and credits that may materially reduce the estate tax liability on your wealth after you and/or your surviving spouse die. Any estate lawyer or tax accountant worth their salt can walk you through the details.

Your living trust will also enable you to control how your assets flow to your heirs. If you have minor children, most states won't let them own property directly while they're 17 or younger. And if you're passing along a substantial amount of wealth, giving it to all to them at age 18 in a lump sum is a bad idea (unless you want the inheritance squandered in an epic blast of debauchery).

Via your trust, you can specify how you want your assets (and any associated income from them) to be meted out to each heir over time -- based on age milestones, financial need, use (e.g., education), mental competency, or any other conditions important to you.

Similarly, a living trust is helpful in keeping your assets managed the way you want should you become incapacitated (i.e., still living, but not able to mentally or physically manage your affairs). For many of us, living too long may become the bigger risk to our estate vs dying too soon.

Last, the most common form of living Trust is amendable throughout your life. You can change it at anytime, as often as you like. Or you can dissolve it altogether. The bottom line is, you're in full control over everything while you're alive (and mentally competent).

Getting Started

OK, as a refresher:

  • A will is a good idea for pretty much everyone. But it's especially important for people with minor children. A trust does not specify legal guardianship in the event of your death. Only a will does that.
  • A living trust makes sense for anyone with assets and heirs (especially your spouse) they want to pass their wealth along to. Some experts say living trusts make sense if you expect your estate to be worth over $150,000; others go as low as $20,000.

The cost to set these up is pretty trivial compared to the huge benefits they can offer your loved ones. A will costs a few hundred bucks (or less) to set up and can be completed in a matter of days (or less). A living trust will range between several hundred and a few thousand dollars, depending on how sizable/complicated your estate is.

In Part 2: A Primer On The Essentials For Your Will & Living Trust, we walk through in detail the principal legal elements that your will and living trust should address. This includes specific clauses your documents should contain (unless advised otherwise by a professional), as well as helpful context for the most common decisions folks will face when creating/updating these legal vehicles.

If you don't yet have a will and/or a living trust, or it's been a while since you've reviewed the ones you have, read on. Your loved ones will be glad you did.

Click here to read Part 2 of this report (free executive summary, enrollment required for full access)

It's high time to leave the partisan politics behind and focus on the facts about face masks and whether or not they really work against COVID-19.

On the radio program Tuesday, Glenn Beck spoke with Drs. Scott Jensen and George Rutherford about the scientific evidence that proves or disproves the effectiveness of mask wearing to stop the spread of the coronavirus. Then, Dr. Karyln Borysenko joined to break down where the massive political divide over masks came from in the first place.

"I think if we were to talk about this a couple months ago, I might have said, 'Well, there's the science of masks, and there's the emotions of masks.' But, unfortunately, there's something in between," Jensen said. "I would have thought that the science of masks would have to do with the physics of masks, so I did a video a couple months ago where I talked about the pore side of a cotton mask or a surgical mask."

He explained that properly worn masks can help reduce the spread of virus particles, but cautioned against a false-sense of security when wearing a mask because they are far from providing complete protection.

"If you have a triple-ply mask, the pore size will end up being effectively five microns. And five microns, to a COVID-19 virus particle, is 50 times larger. That's approximately the same differential between the two-inch separation between the wires of a chain-link fence, and a gnat," Jensen explained.

"But now what we're seeing is if we have some collision of COVID-19 viral particles with the latticework of any mask ... if you're breathing out or breathing in and the viral particles collide with the actual latticework of a mask, I think intuitively, yes, we can reduce the amount of virus particles that are going back and forth."

Dr. Rutherford said masks are essential tools for fighting COVID-19, as long as you wear them correctly. He laid out the three main reasons he believes we should all be wearing masks.

"So, we're trying to do three things," he said. "First of all, we're trying to protect the people around you, in case you are one of the 60% of people who have asymptomatic infection and don't know it. The second thing we're trying to do is to protect you. The third thing we're trying to do is, if you get infected, you'll get infected at a lower dose, and then you're less likely to develop symptoms. That's the threefer."

Watch the video below to catch more of the conversation:


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On the heels of the Seattle City Council's vehement support for cutting the police department by 50%, the council's next plan is to abolish prisons, municipal courts, and ultimately the entire criminal justice system, according to several documents leaked from the King County Executive's Office in Seattle.

The documents, which read like a critical race theory paper or a far-left diversity training pamphlet, detail a plan that has apparently been years in the making. They argue America's criminal justice system is a "white supremacist institution" that must be dismantled entirely.

Christopher Rufo, editor for City Journal and director of the Discovery Institute's Center on Wealth and Poverty, joined Glenn Beck on the radio program Monday to reveal exactly how and why city leaders plan to abolish the foundational institutions responsible for catching and prosecuting crime, including police departments, jails, prisons, and court systems.

"This is a document that comes from the King County's executive office, and it really provides the theoretical basis for the executive's plan to completely and permanently shut down the largest jail, with no plans to replace it," Rufo said of the first document. "It has a kind of chart and a pyramid that says that ... the things that are foundational to the justice system in Seattle, and in the United States, is white racism, white supremacy, white fragility, and a whole lot of other theories with the kind of the buzzwords that have been circulating lately."

The documents go on to claim that crimes committed by "People of Color" are not the fault of the criminal, but the fault of society — specifically white society.

"The logic is, well, if you have a racist society, that in essence forces people, especially people of color, to commit crimes. If you abolish the institutions of the carceral system, if you abolish the jails, if you abolish the police, and the municipal courts, those people will stop offending because their oppression has been lifted," Rufo explained.

"I mean, it's absurd! It doesn't work in practice at all. And it gets the causality so skewed it's hard to even understand on logical grounds. But this is the kind of pseudo-scientific, pseudo-academic nonsense that is driving the decision making at the highest levels of government in Seattle, in Portland, in New York, and elsewhere. It's really shocking because they're really boiling down a very complex social problem, crime, to just, 'white people are evil and they set up these evil institutions that force people to do wrong.' And their solution is not reform at this point. For many years, it was about criminal justice reform. They've moved well beyond that, in very rapid succession, to do criminal justice abolition."

View the source documents here and here.

Watch the video below for more details:

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Despite being just about the most isolated family in America for the past several months, Glenn Beck's entire family caught COVID-19 — all except for his two grandkids and himself, that is. Fortunately for them, it was no worse than having a "bad cold with a fever."

On the radio program Monday, Glenn shared what the experience has been like so far, the medicines his doctor has prescribed, and why he believes everyone will eventually catch this virus.

Watch the video below:

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Acting Deputy Secretary for the Department of Homeland Security, Ken Cuccinelli, joined Glenn Beck on the radio program Thursday. He came prepared to expose the leftist lies and detail the truth about what's really going on with federal agents in Portland, Oregon.

Cuccinelli made it clear that claims of federal agents in unmarked cars " kidnapping" Portland protesters from the streets are patently false. Rather, agents are protecting federal buildings in a lawful, safe, and constitutional manner.

"There are four federal agencies [in Portland] protecting the federal property. Three of them are from the Department of Homeland Security. The U.S. Marshals is the fourth, they guard the inside of the courthouse," explained Cuccinelli.

He went on to explain that a little known division of the DHS, called the Federal Protective Service, protects thousands of federal properties across the country, and has been protecting the Mark O. Hatfield U.S. Courthouse in downtown Portland since it was built in 1997.

"This is not a new mission. It's a 24/7, 365 mission. We've been there from the beginning of this courthouse being built, and the birth of the Department of Homeland Security," Cuccinelli said.

"Our officers have bravely and resolutely done their duty and done their job to protect their facilities and people using them, and each other, of course," he continued. "And with respect to the cars, we do use unmarked cars. I almost laughed when I heard [House Speaker] Nancy Pelosi making this 'accusation.' Maybe she should check the San Francisco Police Department. You will find that every single law enforcement agency of any size in America uses unmarked vehicles, because they're safer for the officers and they're more effective for the mission. And we're not grabbing people off the street. The only people that we detain are people that match descriptions of offenders or who were just caught in the act."

Watch the video below for more details:

Want more from Glenn Beck?

To enjoy more of Glenn's masterful storytelling, thought-provoking analysis and uncanny ability to make sense of the chaos, subscribe to BlazeTV — the largest multi-platform network of voices who love America, defend the Constitution and live the American dream.