A letter of intent, while not legally binding, can be a remarkably helpful document to accompany a testamentary trust, providing guidance to the trustee regarding your wishes and intentions without the formality—and rigidity—of the trust document itself.
What are the benefits of a revocable living trust?
Many people establish revocable living trusts to avoid probate, simplify asset management, and provide for the distribution of their assets after death; however, these trusts are often quite formal and can lack the nuance of personal preferences. A letter of intent allows you to express those preferences—regarding things like educational philosophies for grandchildren, charitable giving priorities, or the sentimental value of certain heirlooms—without altering the core legal terms of the trust. Approximately 60% of Americans die without a will or trust, leaving their assets subject to potentially lengthy and costly probate proceedings, a situation a well-planned trust with a guiding letter of intent can help avoid. The letter serves as a ‘road map’ for the trustee, offering insight into the ‘why’ behind your decisions, not just the ‘what.’
How does a testamentary trust differ from a living trust?
A testamentary trust is created *within* your will and only comes into effect *after* your death, while a living trust is established during your lifetime. This means the trustee doesn’t have access to your informal guidance until after you’re gone. A letter of intent, even though non-binding, can bridge this gap by providing context *before* the trustee begins to administer the trust. Imagine old Man Tiberius, a rancher of some renown, leaving everything to his niece. He wanted the ranch to stay in the family, but his niece, a successful lawyer in the city, had no interest in agriculture. A letter of intent could have explained Tiberius’ deep connection to the land, the importance of preserving his legacy, and gently suggested she consider leasing the property to a local farming family. Without it, the ranch could have been sold, erasing a century of history.
What happens if my wishes aren’t clearly documented?
Without a letter of intent, a trustee is bound to interpret the trust document strictly according to its legal language, which can sometimes lead to unintended consequences. I once worked with a client, Eleanor, who had established a testamentary trust for her son, David, a budding artist. She wanted him to have enough financial security to pursue his passion, but she worried about him becoming overly reliant on the funds. The trust specified regular distributions to cover his living expenses, but it didn’t address the possibility of David receiving a substantial inheritance from another source. Without guidance, the trustee continued the regular distributions, even after David sold a painting for a six-figure sum, effectively discouraging him from earning his own income. A letter of intent could have clarified Eleanor’s intention for the funds to supplement, not supplant, David’s artistic endeavors. Data shows that roughly 40% of estate disputes stem from misunderstandings of the deceased’s intentions.
Can a letter of intent be updated alongside my trust?
Absolutely, and it’s strongly recommended that you review and update your letter of intent whenever you make changes to your trust or experience significant life events. It’s a fluid document, meant to reflect your current wishes and values. I remember a situation with the Millers. They had created a trust years ago, leaving everything to their two children equally. Later, their daughter, Sarah, dedicated her life to volunteer work, earning very little income. They wanted to provide for her without creating an imbalance. They updated their letter of intent, explaining their desire to supplement Sarah’s income to ensure her financial security without disproportionately benefiting their son. They also added a heartfelt message emphasizing their love and appreciation for both children. This simple addition, a personal touch, brought immense comfort to the family during a difficult time. It’s the human element, the story behind the estate, that often matters most. A well-crafted letter of intent, alongside a properly executed testamentary trust, can ensure your wishes are not only legally sound, but also deeply meaningful.
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About Steve Bliss at Escondido Probate Law:
Escondido Probate Law is an experienced probate attorney. The probate process has many steps in in probate proceedings. Beside Probate, estate planning and trust administration is offered at Escondido Probate Law. Our probate attorney will probate the estate. Attorney probate at Escondido Probate Law. A formal probate is required to administer the estate. The probate court may offer an unsupervised probate get a probate attorney. Escondido Probate law will petition to open probate for you. Don’t go through a costly probate call Escondido Probate Attorney Today. Call for estate planning, wills and trusts, probate too. Escondido Probate Law is a great estate lawyer. Affordable Legal Services.
My skills are as follows:
● Probate Law: Efficiently navigate the court process.
● Estate Planning Law: Minimize taxes & distribute assets smoothly.
● Trust Law: Protect your legacy & loved ones with wills & trusts.
● Bankruptcy Law: Knowledgeable guidance helping clients regain financial stability.
● Compassionate & client-focused. We explain things clearly.
● Free consultation.
Services Offered:
- living trust
- revocable living trust
- irrevocable trust
- family trust
- wills and trusts
- wills
- estate planning
Map To Steve Bliss Law in Temecula:
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Address:
Escondido Probate Law720 N Broadway #107, Escondido, CA 92025
(760)884-4044
Feel free to ask Attorney Steve Bliss about: “Can I use estate planning to protect assets from creditors?” Or “How can joint ownership help avoid probate?” or “Do I still need a will if I have a living trust? and even: “Can I include back taxes in a bankruptcy filing?” or any other related questions that you may have about his estate planning, probate, and banckruptcy law practice.