Santa Clarita Living Trusts Attorney Robert Mansour Discusses Estate Planning Basics with Fred Arnold on "Out of the Rough:"

HERE IS THE TRANSCRIPT FROM THE INTERVIEW:

Fred:    Welcome back to Out of the Rough.  I’m joined by Robert Mansour.  Robert Mansour is an attorney with the Law Offices of Robert M. Mansour.  Welcome to the show.

Robert Mansour:         Thank you Fred.

Fred:    I wanna take some time to talk about trusts –

Robert Mansour:         Oh okay.

Fred:    – and the importance of a trust in estate planning.  Specifically as a mortgage professional I see so many customers that don’t have their property or their properties in trust.

Robert Mansour:         Uh huh, uh huh.

Fred:    Tell me about an estate planning.

Robert Mansour:         Estate planning is nothing more than a legal toolbox that you use or your family can use or your loved ones can use if something happens to you.  If you can’t handle your own affairs the question is now what.  Okay I’m in a coma.  I’m sick.  I’m at the hospital.  Who’s going to handle all of my affairs after you pass away?  How is your stuff, your things, your belongings, your real estate, your accounts, everything else, how is that going to be pass to other people and in what manner?  And who’s going to be in charge of that?  So I always tell people an estate plan is a legal toolbox.  No matter how much money you have 50 grand, $50 million, you need to have a plan.  And so the trust is one of the documents in this particular toolbox.

Fred:    And I see that being one of the, one of the ones I see the most in real estate industry.

Robert Mansour:         Yeah.

Fred:    But, but I wanna touch upon one thing and, and those that are watching this I wanna stress it’s something you might not wanna talk about.  It’s something that’s uncomfortable to talk about.

Robert Mansour:         Uh huh.

Fred:    It’s something that you keep puttin’ off.

Robert Mansour:         Yep.

Fred:    But it’s something that’s critical and ver-, relatively inexpensive for the value you get.

Robert Mansour:         Oh yeah.  I mean if you think about what the cost might be at the back end if you do not plan and then if you do plan it’s a bargain.  But I must say that people do put it off because it’s easy to put off.

Fred:    What are the big four, the big four documents?

Robert Mansour:         The big four documents, the hammer in the tool box is the living trust.

Fred:    Yes.

Robert Mansour:         Other important documents are the will.  People say why do I need a will if I have a living trust.  The will is a backup to your trust.  So let’s say something doesn’t get into your trust, you forget to change title to that asset and here you are in court, probate court.  The will tells the judge to put everything into your trust, the Smith family trust or whatever.  So it’s a backup.  If everything is properly titled then you won’t need the will.

Fred:    And in the will you can actually put specific bequests that you, that would be unusual, that would be different.

Robert Mansour:         Well that’s actually a good place for it to put in your trust.  Your trust would say I want my vase to go to my Cousin Joe and I want my –

Fred:    Oh okay so you’d actually put it in the trust?

Robert Mansour:         – Yeah you put it in the trust.  The will is only a backup to the trust.

Fred:    Got it.

Robert Mansour:         That’s all it does.  And then there’s two others.  There’s one called an advance healthcare directive.

Fred:    Uh huh.

Robert Mansour:         Which puts somebody in charge of your healthcare decisions if you cannot do it.  Most people think that their spouse is automatically entitled to do that and that is an incorrect assumption.  Somebody has to have the legal authority to make sure to consent to surgery, to get your medical records, to move you from one facility to another, to the proverbial pull the plug.

Fred:    Uh huh.

Robert Mansour:         So this document allows that individual to do a lot of that, and if anybody else disagrees you’re not gonna have a stalemate.  You have somebody with the legal authority.

Fred:    To make decisions on your behalf if you can’t make those decisions.

Robert Mansour:         That’s right.

Fred:    And we’ve talked about car accidents where that decision you might be eventually perfectly healthy and perfectly fine cut someone needs to make a decision right then and there.

Robert Mansour:         Right.  And sometimes that document comes in very handy and that leads to the last document.  The last of the four major big ones in the, in the plan, it’s called a durable power of attorney.  Now in that particular document you are naming somebody to act on your behalf in virtually every other circumstance.  They can talk to your lawyer, to your, uh, financial professional, to your loan person, to, uh, the HR department at your former employer.  They can talk to the people managing your pension plan, your IRA, somebody to handle your credit cards.  Who has the legal authority to act on your behalf –

Fred:    Uh huh.

Robert Mansour:         – if something happens to you.

Fred:    Uh huh.

Robert Mansour:         And so those are the big four documents that go into most plans.  And one, and all this goes to avoiding probate.  Give me a quick understanding of probate.  So here’s the deal:  My wife and I pass away.  Our assets do not magically go to our children.  There’s no rainbow that comes from the sky and makes our house go to our kids.  It has to happen somehow.  How does it happen?  Well you know this.  You’re all about title and how, how homes are in title et cetera.  The house has to pass to my kid so a judge has to get involved because no one is, my kids can’t just go sell the house.  It’s not theirs.  They don’t own it.  So a judge has to say this is your house, these are you accounts, this is your money.  That process is called the probate process.

Fred:    Well it sounds expensive?

Robert Mansour:         It can be.  It can cost up to 5 percent of the gross of the estate.

Fred:    Gross.

Robert Mansour:         The gross.

Fred:    So if you have a house worth 700,000 even though there’s a little bit of equity –

Robert Mansour:         Yeah.

Fred:    – 5 percent of 700,000 is a lot of money.

Robert Mansour:         Yeah and a lot of times, sometimes people walk away because it doesn’t make financial sense to go through the process.  Plus the mortgage payment is still due during that one or two years that you’re in court.

Fred:    Right.

Robert Mansour:         Who’s going to pay that?

Fred:    Yeah and it does take some time.  I know we’re runnin’ out of time –

Robert Mansour:         Yeah.

Fred:    – and we wanna touch as much as we can.

Robert Mansour:         Yeah.

Fred:    But the last thing I’m gonna touch upon with is and that is children.

Robert Mansour:         Yeah.

Fred:    With four children myself it is important because with life insurance and all the assets of the family if something, God forbid, happened to my wife and I –

Robert Mansour:         Uh huh.

Fred:    – there’s a few, well I shouldn’t say that, but maybe there’s somebody that wants to watch my children or look after my children for the wrong reason.

Robert Mansour:         Uh huh.

Fred:    Maybe there are certain, someone in the family that we don’t wanna choose.  We’d prefer this person over that person.

Robert Mansour:         Yeah.

Fred:    And that allows you to, to, to discuss where the children go.

Robert Mansour:         You can name guardians for your children if they are minors.

Fred:    Uh huh.

Robert Mansour:         Plus if they are minors, for example my kids are 15 and 13 currently.  My life insurance policy is not made payable to them.  No way.

Fred:    You don’t wanna give a 15-year-old.

Robert Mansour:         No because I know what he’s gonna do with the money.  But it’s payable to the Mansour Family Trust.

Fred:    Right.

Robert Mansour:         And then my trustee manages the money for my kids.  Gives it to them at appropriate ages for appropriate reasons, for schooling, for any other appropriate reason.

Fred:    Uh huh.

Robert Mansour:         And the money stays safe.  Plus if it’s in the trust we can design it so that if my kids get divorce, if they get into bankruptcy trouble, credit problems that money is safe in the Mansour Family Trust and my kids are not facing some kind of exposure or losing half of that money in a divorce or something like that.

Fred:    Uh huh.

Robert Mansour:         So there, you can protect the kids that way.

Fred:    Important information.  And, and I wanna stress, um, as we, as we finish this segment is you can look for information online but it’s really critical that you go a professional like Robert.  Robert how could those watching this online –

Robert Mansour:         Yeah.

Fred:    – or on TV, uh, get a hold of you?

Robert Mansour:         Well I appreciate that.  They can just go to my, uh, estate planning web site which is Mansourlaw.com.  My last name M-A-N-S-O-U-R.

Fred:    Mansour.

Robert Mansour:         Mansourlaw.com and that’s my web site.  Otherwise they just call the office which is 661‑414‑7100.

Fred:    Thank you.  Thanks for all you do for the community.

Robert Mansour:         Thank you.

Fred:    Thanks for, uh, sharing.  It’s a wealth of information.

Robert Mansour:         It’s my honor.

Fred:    In a short timeframe.

Robert Mansour:         Thank you very much.

Fred:    Appreciate it.

Robert Mansour:         Thank you.

Fred:    Absolutely.  Well we’re gonna jump to a quick break and we’ll be right back.