In Dad We Trust

old_man-2After my dad’s funeral, we began the first monumental task: wrapping up his financial affairs. Dad’s money was his favorite thing. We thought he would’ve treated it better.

My Dad got his will from or whoever else peddles legal forms to unsuspecting octogenarians on the web. For a man who always claimed his browser was “broken,” he found a way to buy and print a will. Then, in all caps — he couldn’t work the shift key — he typed his name, my name, signed it and had it witnessed and notarized. If he’d stopped right there, it would have been easy to transfer his stuff to my name. But nothing is easy with my dad. He downloaded another form to establish a trust. The trust is another way to pass on money, and totally unnecessary. To use a trust, you must set your money up in trust accounts. Loosely translated, a trust is an account that requires your beneficiary to jump through more hoops than Shamu trying to get a fish. My father did all of this jockeying to avoid paying a lawyer to write his will and to eliminate the need for a lawyer when he died.

The first thing we did was hire a lawyer. While the will was perfectly legal, none of the trusts could pass to us without a hoarder’s paradise of legal paperwork. We found a lawyer in Mahopac, my hometown, and had our first meeting.

“I knew your father,” the lawyer said right out of the gate.

“You did?” I said, surprised. How did my father know an estate lawyer when he went through such trouble to avoid using one?

“I represented him in his car accident case,” he said. (See “Fifty Shades of Crazed”)

I laughed, “Oh my God, that’s too funny!”

“Got him a good settlement too,” he said. (See “Fifty-one Shades of Crazed“)

We began to tell him about my father’s estate. We told him about the homemade will.

“That doesn’t surprise me,” he said.

We told him about the homemade trust document.

“That doesn’t surprise me.” He asked us about the trusts and he looked at my dad’s account statements. My husband, who is almost a CPA, knew that in order to have a legal trust, you must get it its own tax ID number and pay taxes on it as an entity. My father didn’t do that. He just opened accounts called trusts, but didn’t do any of the legal documentation or filings. Maybe if he’d consulted a LAWYER, he’d have done it right.

“Doesn’t surprise me,” the lawyer said.

The lawyer said he could help us, and explained how estates work. Because my father did not set up his accounts properly, we needed a lawyer to contact financial institutions, petition the courts and pay the estate’s bills. Just for bill payment, they had to hang onto every dime for seven months, so they could pay anything that my dad owed. After that, because of all the legal hoops we had to jump through, it could take up to two years to get any of the money. We could sell the house and the car, but the house proceeds would go into the estate and be tied up until they could release the money. The next-of-kin can sell one vehicle, valued under $25,000. My father’s used Corolla qualified.

The one exception to the legal rigmarole was that accounts that were not trusts and listed me as beneficiary could be liquidated immediately. Basically that meant checking and saving accounts. The lawyer said that he’d start work for a $5,000 retainer. We’d just liquidated one bank account to pay for the funeral and we didn’t have access to any more money. Fortunately, we found another bank account that listed me as beneficiary and headed right over to get the money for the lawyer. The bank manager was very nice and wrote us a check.

We headed back over there, handed the check to him and exhaled. At least we knew we could get the money and that we didn’t have to stay in Mahopac indefinitely arguing with banks.

The moral of this story is: For the love of God, hire a lawyer to handle your will and your financial affairs! You can leave your family money, or you can leave them stress. Don’t let it be both.