Seniors and Trusts: Should We Also Name a Co-Trustee?

“Alice” and her husband “Andrew” had a very good question about appointing a Successor Trustee for their Living Trust. At 80, Alice had been diagnosed with cancer, and she was still very weak after months of chemotherapy. Andrew was 85 and dealing with a number of health problems. He had had a stroke a few months ago and was now partially paralyzed. They were getting stronger and were able to live independently in the family home. Their daughter, Olivia, lived close by in Walnut Creek, called her parents every day and visited at least once each week.

When creating a Living Trust, couples generally serve as each other’s Trustees

Couples typically serve as each other’s Trustees and don’t generally name another Co-Trustee. In Alice’s case, however, she was reluctant to burden Andrew with this responsibility, and her cancer had left her feeling vulnerable. She decided to name Olivia as Co-Trustee to help pay bills and manage their Trust’s assets if it became necessary.

Co-Trustee agreement set up at financial institutions

Alice and Olivia went to the couple’s banks and Olivia was added to all of their Trust’s bank and brokerage accounts, in her capacity as co-Trustee of the Living Trust. Importantly, these accounts still belong to Alice and Andrew; Olivia is essentially like a trusted hired co-manager who is tasked with controlling the assets along with Alice. Olivia has a fiduciary duty to work in the best interests of Alice and Andrew.

These financial institutions also issued new checks indicating that Olivia had been added as a Co-Trustee. Olivia will be able to manage and monitor the accounts as well as pay bills from these accounts. By naming Olivia now as a precaution, she can begin taking a more active role as the need arises.

Additional benefits of adding a Co-Trustee: Protection against elder abuse

Many seniors have lost significant assets through fraudulent scams of elder abuse. Appointing a trusted family member or friend as Co-Trustee to monitor accounts can help eliminate this kind of scam. Note that the Co-Trustee does not have the power to amend or revoke the Revocable LivingTrust, and the authority invested in this role can be managed according to the agreement that is created.

A big part of end-of-life planning is creating a Living Trust, and many of our clients make this one of their New Year’s resolutions. Schedule an appointment today at one of our three Bay Area offices. Our dedicated team is helpful, compassionate and affordable.

Creating a Living Trust? Don’t Forget Your Pets

I don’t know what it’s like in your neighborhood, but where I live, everyone seems to have a dog. On my morning walk I routinely greet a wide variety of scruffy mutts of dubious lineage, sheepdogs, the biggest Great Dane I’ve ever seen, an obese Bulldog and a yellow Lab who has simply stolen my heart. For many people, especially the elderly, a pet is a loyal companion. It shouldn’t be surprising that people want to make provisions for their pets in their Living Trusts, just as they do for the rest of their families. In California, as in 39 states, there are Pet Trusts.

One woman loses her best friend and a dog

Clare Jackson’s eyes fill up when she thinks about the death of her best friend, Sylvia. Not only did Clare lose her friend of 40 years, but she also lost Sylvia’s beloved Labrador, Dolly. Sylvia had a stroke and died, and her caregiver immediately euthanized Dolly. “There was nothing I could do–Sylvia had revised her Will, and there was no mention of Dolly.”

This experience was a bitter lesson for Clare, who also loved Dolly and would have gladly provided a loving home for her. (Note that Clare and her husband have made provisions in their Trust for their own dog, Oliver.)

Animals who outlive their owners face uncertain futures

People who die before their pets leave stranded animals. In a best-case scenario, a neighbor, family member or friend cares for the pet for the rest of its life. The alternatives? The Humane Society estimates that six to eight million dogs and cats enter shelters annually. An estimated half are adopted, and the rest are euthanized. In some sad cases, after the death of its owner a pet is simply let out the front door to get lost, run over or any of the other horrible fates that befall abused animals.

Thinking of leaving a chunk of change to Spot or Fluffy?

So what are your options for your pets? A Will is a transfer of assets. An animal can’t own property–someone has to be in charge.

The solution: A Pet Trust

This legal document outlines the continued care and maintenance of domestic animals; it also names new caregivers or directs Trustees to find new homes for pets. A Trustee has a legal duty to carry out your wishes.

While owners may simply include their pets as provisions in their Wills, Michael Markarian of the Humane Society believes a Trust is a better option in case of disability. “Wills may take weeks to be executed and could be contested, but a Living Trustcan be written to take effect immediately.”

Creating a Pet Trust: Think about the economics of caring for your pet

When naming a Trustee, think about the expense of caring for a pet. Food and visits to the vet can add up. Some owners make outright gifts of cash for their animals’ care.

• One woman set aside $5,000 to offset costs for the person who ends up with her dogs.
• Another pet owner reveals that she has a list of ten people who are potential Trustees care for her cat, Sadie. What the new caregiver won’t know at first is that the estate is instructed to award the person $10,000 if the feline is still with him/her after six months. “I want someone to care for Sadie out of love and kindness and be rewarded if they keep her and fall in love with her like I did.”
• Others leave money to be distributed over time—monthly, annually, or as reimbursement for expenses.
• For even more security for a beloved pet, name someone other than the caregiver as Trustee. This person will dole out the cash on some kind of predetermined schedule, reducing the risk of someone’s taking the money and getting rid of the pet.
• One man created a Living Trust for his three Rottweilers. If his ex-wife couldn’t take care of the dogs, two Trustees were given explicit instructions to use their best judgment to find good homes for his pets. There were dependencies: The dogs should be kept together, and the new caregiver would receive $150 per month, plus money for veterinary bills and other expenses.

Choose your Pet Trustee carefully, just as you would choose a guardian for your child

Talk to potential caregivers for your pets until you find someone you trust. In the same way that you would be choosing someone to take care of your children, what you really want is a person who will love your pet as you have.

We encourage everyone to create a Living Trust

A Living Trust is an important part of life planning and is one of the most thoughtful things you can do for your family. Our dedicated Living Trust team is helpful, compassionate and affordable, available by phone and email throughout the process. Contact California Document Preparers at one of our three Bay Area offices today to schedule an appointment.