We often meet with individuals who have received generic mailings or have been approached by someone selling Revocable Living Trusts. These salesmen may either come directly to the front door of your home or make a sales pitch to a group of individuals through a community or group event. The document that they are selling called the Revocable Living Trust is often times referred to as the "living trust." The salesman may proclaim the living trust to be a cure all for many, if not all, estate planning problems that individuals may face. Unfortunately, these claims are frequently erroneous or at least misleading.
If confronted with a living trust sales person, please be aware of the following:
1. The sales representatives are frequently not licensed to practice law or to provide you with legal advice or a proper explanation of the living trust and its benefits or detriments.
2. The sales representatives will frequently work for companies which consumer advocates refer to as "trust mills." These trust mills are often pursued by the consumer advocacy groups in the Commonwealth of Pennsylvania as well as the attorney general's office for the unauthorized practice of law. Even after these groups are challenged successfully, others will often reemerge to continue the pursuit of the unwary.
3. The sales representatives often target the elderly or other individuals who they feel may be easily influenced. They will take advantage of senior citizens who may have more of an urgency to create such documents and who may be more easily swayed by sales pressure.
4. Placing your personal residence into a living trust might actually be detrimental as it will make it an available asset for the spending process for long term nursing care and could result in the entire value of the property being lost where it might have otherwise been protected.
5. The cost for the preparation of these documents by a non-lawyer will often be more expensive than the cost to have an experienced legal counsel represent you. You will often be charged $1,995.00 to $5,000.00 and the consumer is likely to never speak directly to an attorney, accountant or other professional advisor.
6. Despite the relatively high cost to have these documents prepared by a non-qualified representative, the overall benefits rarely equal the costs associated and these companies may not provide continued support should questions arise.
There are many useful applications for the Revocable Living Trust. In many states, the revocable trust is a very important planning tool. However, in Pennsylvania the laws are such that not all of the same benefits result from the creation of the living trust. We have outlined only a few of the reasons why it is important that you consult with your trusted practitioners to determine if this type of planning is truly for you.
Douglas L. Kaune and David M. Frees, III are local attorneys practicing primarily in the areas of estate planning, estate administration and elder law. For questions, you may contact them at (610) 933-8069 or email@example.com.