I was very honored to be invited to SCV Today, a local television program covering local Santa Clarita events and issues. Hosts Tami Edwards and Dave Caldwell asked me some very common questions regarding estate planning, wills, living trusts, and much more. We discussed issues such as "What is the difference between a will and a living trust?", "Doesn't the spouse simply get everything?", and "Don't my children get everything when I die anyway?" We also touched on the issue of probate and what's involved. Tami also raised the Advance Health Care Directive and how important it is to have someone in charge of such decisions. Finally Dave asked Rob about what's involved in creating an estate plan. Rob explains several basic concepts in this video segment.
Robert Mansour is a wills and living trusts lawyer in Santa Clarita, California. He also serves Valencia, Newhall, Saugus, Canyon Country, Castaic, Stevenson Ranch and surrounding communities. For those without a plan, Rob generally offers free consultations. Call today and schedule your appointment - (661) 414-7100.
HERE IS THE TRANSCRIPT FROM THE INTERVIEW:
Dave: Welcome back to SCV Today. Today we are all getting older. A lot of us are family, have families.
Tami: Mm, hmm
Dave: You're not getting older, but you do have a family.
Tami: Yes I do.
Dave: Right? And, uh, we need to be thinking ahead of things. My parents thought ahead, long, long time ago and they created a living trust, and, uh, now Rob Mansour is on to talk about that, an estate planner –
Rob Mansour: Mm, hmm
Dave: - an attorney, an Oxy grad.
Rob Mansour: Oxy grad, that's right, proud of it.
Dave: Yeah –
Rob Mansour: And Oxy's statistic, uh, most Oxy grads marry other Oxy grads, and my wife is also an Oxy grad.
Dave: Wow, that's very cool.
Rob Mansour: So, she, you know, I'm a good catch so what can I say.
Tami: You are a good catch, Rob.
Rob Mansour: Thank you very much.
Dave: Let's, let's talk about this. We're gonna start the conversation off with something very basic, the living trust versus a will.
Rob Mansour: Mm, hmm
Dave: What's the better way to go?
Rob Mansour: Okay, if you have more than $150,000.00 in California, uh, real estate, uh, bank account, investment, etc., you're better off with a trust. A will only goes into effect when you die, so if you have a will, a lot of please say, oh I have a will. I say that's great, but it doesn't mean anything while you're still living. Nobody can use a will to assist you in case of incapacity or you get into an accident or something like that. A will is just a wish list of where you want your things to go when you die. I want my vase to go to my Cousin Sally. I want my car to go to my, my Cousin Vinnie. I want this to go here, this to go there. That's all a will does, and you gotta go to court with the will. That's called probate court. You've heard of criminal court, civil court, juvenile court. Well, there's something called probate court, and that's where the judge makes sure that Sally gets this and Johnny gets that, and the house gets to the kids, and it's court supervised, but it's very expensive. It takes a long time, sometimes two years or more, and it's very frustrating because who has the time. Also, let's say you have a house that's going through the probate process. Somebody has to pay the mortgage on that house, and statement the family doesn't have the money, so everybody's kinda like, okay, what are we gonna do? And I've had families have to walk away from certain assets because they could not afford to continue making the payment while it's making its way through this probate system.
Tami: So, now I know a big misconception is if you have a will, it, it doesn't go to probate, but that's, that is a huge misconception.
Rob Mansour: Well, a will is almost guaranteeing probate because it's, a will is a letter to the judge.
Rob Mansour: Dear Judge: This is where I want my stuff to go when I pass away. That's all it is. Um, now some people try to –
Tami: You getting nervous over here?
Dave: I'm getting very nervous, yeah.
Rob Mansour: We better get you an estate plan quick because you're about to –
Dave: Yeah, we got about six minutes left in this segment. Can you get it done?
Rob Mansour: Quick, quick, let's get your paperwork in order.
Rob Mansour: But you're right, yeah, there are other things that people try to do. They try to do joint ownership as a way around a will. They'll say, I'll just own things jointly with my spouse or, but that has its own dangers, and if you want, we can get into those, but I don't know, you know, if that's something that you want to address.
Dave: Well, let me, let me ask you a quick question. I'm sorry to interrupt you, but, but I have one child.
Rob Mansour: Yep.
Dave: What happened, is, is everything automatically gonna go to him?
Rob Mansour: Okay, uh, what's your son's first name?
Rob Mansour: Chris, okay, so you pass away. You're unmarried, correct? Everything will go to Chris according to California law. How old is Chris?
Rob Mansour: Okay, so Chris will get everything right away, which might be fine, but remember, he's gotta go through the probate process to get everything.
Rob Mansour: If you own –
Dave: Which can take –
Rob Mansour: a real estate –
Dave: -which can take some time?
Rob Mansour: - yeah, there's no magic pixy dust that comes from the sky and makes everything belong to Chris. He can't just sell your house or your car or things that he doesn't own, and he can't just start doing that. Also, if it really a good idea for Chris to get everything at 21? Maybe he should get things at 25 or 30. What if Chris is in a bad marriage and there's a divorce pending? Should that ex-spouse get half of your stuff during that, during that process?
Dave: Good point.
Rob Mansour: What if, uh, Chris becomes a spendthrift and can't hold onto money? What if he's in bankruptcy or creditor trouble or he's got, he made a bad investment and they're coming after him?
Dave: Don't, don't forget, he's an Oxy guy so do you think he's gonna do all these things?
Rob Mansour: No, of course not, but somebody other than Chris –
Dave: Yeah, I gotcha.
Rob Mansour: - might have those problems and wouldn't it be nice if everything was sitting in the Dave Caldwell Trust protected for Chris' benefit and shielded away from all of these things? That might be a good idea.
Dave: Yeah, it sounds like it.
Tami: Now, I, I know people in my life that actually have well over $15,000.00 in real estate and so on and so forth.
Rob Mansour: Mm, hmm
Tami: And they don't have a, a will or a trust –
Rob Mansour: Right.
Tami: - and, the, the thought process is, well when one of us goes, it automatically goes to the other anyway. It doesn't matter. We don't need it.
Rob Mansour: Automatically is a big word because let's say my wife and I own something together, like a bank account. Oftentimes husbands and wives are together on real estate and bank accounts. One person dies; yes that's true. The, the remaining spouse does get everything, but at some point, you're gonna run out of people, and now you got one person on that asset, and so now what do we do? So let's say, for example, my wife and I own our house together. Let's say I pass away, okay? Men generally pass away first, for some reason, so I pass away first, right, Dave, no, no comments.
Rob Mansour: But then my wife, my wife meets somebody new. Let's call him, um, Bill and she and Bill get married, and she puts Bill on everything, and then my wife passes away. Guess who owns everything?
Rob Mansour: Bill
Rob Mansour: My kids get nothing. This is the problem with joint ownership. Joint ownership is one of the, the leading reasons why people lose their wealth in this country, remarriages, new friend, somebody you put on your account with you. Sometimes you put people on the account just because you want them to be able to pay your bills, and help you out, but what you don't realize is that, that, you've essentially given them that asset.
Rob Mansour: So, automatically also is not true. I had a client who had a property in Orange County. He passed away. His wife did get that house, but she had to go through the court system to get it because it was only in his name. So, yes, she eventually did get it, but it was even more complicated because he had some natural children from a previous relationship. So, now the wife owns the property with those kids from the previous marriage, and they are in business together now, and they don't get along very well.
Dave: Oh boy.
Rob Mansour: So, California has a plan for you, but I always tell clients, look, you take control. You say when people are gonna get your stuff and how they're gonna get your stuff. Don't let California dictate what happens.
Dave: How easy or difficult is it to create a living trust? Is it, is it a long process or is it simply an office visit; you can get it squared away, and needs, does it need to go through a court to be certified?
Rob Mansour: No, not at all. It's a, it's a contract. So, let's say you and, uh, well let's say Tammy and her husband come in, and they wanna do an estate plan. They sit down with me. We spend probably about an hour and half devising the plan. We also wanna talk about what kinds of living trusts are most appropriate because it's not like you just buy a car. You don't go to the dealership and say, hey, give me a car. But, you have to check, well what kind of car do you need? So, then Tammy and her husband and I would talk about what kind of trust would be best, how the children should receive their inheritance. Should it be all at once? Should it be in stages? Who is going to be in charge of everything in that trust if anything happens to Tammy and her husband? And this first process is probably an hour and a half meeting, sometimes two hours, and then I work on the documents, and I send them to the client for their review. The whole process takes about 45 days to 60 days. Keep in mind that a living trust and a will are just two things in the toolbox that you get. You're gonna get an advanced healthcare directive for each party. You're gonna get durable powers of attorney, marital property agreements. If you own a business of any sort, there needs to be paperwork regarding that. So the first question people always say is, how much for the trust, but I, when I educate them that a trust is just one tool in the toolbox, they start to get a better idea that there's more to it than just one –
Rob Mansour: - one legal document.
Tami: Right, well you know when you're in a situation where there, there is one, one surviving parent, and something happens to them, and if there's no directive as to who is in charge of making the medical decisions, and, um, I can imagine my four children 'cause I would have two feeling one way, two feeling the other –
Rob Mansour: And nobody in charge.
Tami: - Two would be saying pull the plug and the other two would be going, no, save her. I won't say which two are which, but –
Rob Mansour: Also keep in mind that this healthcare directive for example, it's very important because it not only allows you the proverbial pull the plug scenario, but it allows you to be an advocate for that loved one. You can raise, you know, you can raise trouble in the hospital if people are not paying attention to that person. If, you can get the medical records and go to another facility. You can take that individual and take them to a different location.
Rob Mansour: Otherwise, without those tools, you might find yourself, uh, very frustrated.
Tami: Mm, hmm
Rob Mansour: Yeah.
Dave: Rob, thank you very much for joining us. We've gotta take a break here, but –
Rob Mansour: Thank you, Dave.
Dave: - I, I have, I have a feeling that we're gonna need to bring Rob back.
Tami: We definitely need to bring Rob back.
Dave: There's a lot, there's a lot –
Tami: Will you come back?
Rob Mansour: Uh, sure, yes, you're very, you're both very nice, and I love the set, so yes. It's my honor.
Tami: We need to talk personal injury when you come back.
Dave: Oh, yeah.
Tami: We need to talk my case with the Super Bowl people that are –
Rob Mansour: Of course, yes -
Tami: - gonna sue me for saying Super Bowl.
Rob Mansour: - your pending litigation.
Tami: Yes. So, you know, we're gonna have you back.
Rob Mansour: Well thank you very much.
Tami: You're awesome, Rob.
Rob Mansour: Appreciate it.
Tami: And call Rob. He's awesome.
Dave: Call Rob Mansour. If you wanna get his information, you can always go to our web site scvtoday.com. We will direct you over to Rob's best way to contact.
Rob Mansour: Thank you very much.
Dave: And we'll do that. As Tammy mentioned, the big game is coming up this weekend. I'm not gonna say way. I respect the NFL. You're not gonna say anything?
Tami: I was gonna say the NFL can suck it, but I won't.
Rob Mansour: Oh boy.
Dave: Mackenzie Holland's gonna join us here in just a moment. We're gonna talk about healthy, big-game snacks.