As an estate planning attorney with nearly three decades of experience, I've seen the same costly mistakes repeated over and over. Families who think a simple will is enough. Couples who believe everything automatically goes to the surviving spouse. Parents who assume their children's inheritance is safe from divorce.
The truth is, these common assumptions can cost your family hundreds of thousands of dollars and years of legal headaches. But there's a better way – one that wealthy families have used for generations to protect their legacy.
The Expensive Myth That's Costing Families Everything
Let me tell you about Sarah, a successful business owner from Minnetonka. Her father had passed away six months earlier, leaving what she thought was a "simple" estate plan – just a will.
What followed was a nightmare. The family spent $15,000 in legal fees, endured 14 months of probate court, and watched helplessly as every detail of her father's finances became public record. Worse yet, the family was contacted non-stop by people wanting to “help them spend their inheritance” because they knew exactly what each person received and how to contact them because it was all part of the public probate filings.
"I had no idea," Sarah told me through tears. "Dad always said he had everything handled with his will. I thought that meant we'd avoid all this mess."
Sarah's story isn't unique. It happens every day in courtrooms across Minnesota and Florida because most people believe three dangerous myths:
- Myth #1: A will avoids probate court
- Myth #2: Everything automatically goes to your spouse when you die
- Myth #3: Your children's inheritance is protected once they receive it
All three are completely false.
The State Has a Plan for Your Money (And You Won't Like It)
Here's something that might shock you: If you don't have a proper estate plan, your state government has already written one for you. It's called "intestacy laws," and I guarantee it's nothing like what you actually want.
In Minnesota and Florida, these default rules determine who gets your money, who raises your children, and how much of your estate gets eaten up by court costs and legal fees. I've never met a single client who, after learning about their state's default plan, said "Yes, that's what I want for my family." Quite the opposite actually.
But here's what's even worse: Even if you have a will, your family still faces the expensive, time-consuming, and very public probate process. Your will doesn't avoid probate – it guarantees it.
A Will is A Set of Written Instructions to the Probate Court
In the absence of a will, the court will determine who is in charge and who inherits everything based on the defaults in state law. If you have a will, your family will still have to go through probate. However, your will is a set of written instructions to the probate court. So rather than the probate court judge relying on state law to determine these things, the judge will follow the instructions you leave for them in your will about who you want in charge, who you want to inherit, and any protections or restrictions you want to place on receipt of your assets. As you can see, these are huge advantages over doing nothing, but your family will still have to go through probate.
The Living Trust Solution: How Wealthy Families Really Protect Their Legacy
This is why smart families – whether they have $300,000 or $50 million – use a different strategy altogether. They put their assets into trust.
Think of a living trust as a treasure chest you set up that holds your assets during your lifetime and distributes them according to your exact wishes after you're gone. Unlike a will, which must go through probate court, a properly funded trust allows your assets to transfer privately, quickly, and without court involvement.
But avoiding probate is just the beginning. A well-crafted trust provides 5 critical benefits that can save your family hundreds of thousands of dollars and protect your legacy for generations.
Benefit #1 - Complete Privacy and No Court Involvement
When you die with just a will, here's what happens to your family:
- Your will becomes a public document
- Anyone can see exactly what you owned and who's getting it
- Creditors get official notice and can make claims
- Disgruntled relatives can easily contest your wishes
- The whole process takes 12-18 months on average
- Legal fees typically run $10,000-$50,000 or more
With a living trust, none of this happens. Your successor trustee simply steps in, follows your written instructions, and distributes your assets privately. No court. No public records. No lengthy delays.
I had a client, Robert, who owned several rental properties in the Twin Cities. When he passed away last year, his living trust allowed his son to transfer the properties and distribute the other assets to family members within a few months. Total cost: $500 in filing fees. If Robert had relied on a will, the probate process for his real estate alone would have cost his family over $20,000 in legal fees and taken more than a year.
Benefit #2 - Protecting Your Children's Inheritance From Divorce (The Benefit Most Parents Never Consider)
Here's a scenario that many of my clients are concerned about: You work your entire life to build wealth for your children. You die, and your son inherits $300,000. Two years later, he goes through a messy divorce.
In many cases, that inheritance – the money you spent decades accumulating – becomes part of the marital assets split in the divorce. Your former daughter-in-law walks away with half of what you intended for your son.
This doesn’t have to happen. A properly structured living trust prevents this nightmare. Instead of giving your children a lump sum inheritance, the trust can hold their inheritance and distribute it over time, or according to specific milestones you set.
Additional Protection Strategies Within Your Trust
Beyond divorce protection, you can include provisions for:
- Addiction protection: Distributions stop if a beneficiary develops substance abuse issues until they complete treatment
- Educational incentives: Extra distributions for college degrees or vocational training
- Business startup funds: Money available for entrepreneurial ventures with proper business plans
- Creditor protection: Keeping inherited money safe from your children's potential bankruptcy or lawsuits
For example, I recently helped a client set up a trust that included lifetime asset protection trust provisions for their kids. The trust was designed so that their children had access to the trust funds to help them start a business, pay for a wedding and for a downpayment on a home. It also provided for their health, education, maintenance and support; allowing them access to the funds if and when they needed them. However, if one of their children were to get divorced, get sued, or go through bankruptcy due to a job loss or medical emergency, the money still in trust remains protected because it was never owned outright by the child. Their kids could also choose to leave money in the trust to keep it out of their own estate for tax purposes.
Benefit #3 - Incapacity Planning: Protecting You While You're Still Alive
Most people think estate planning is just about what happens when you die. But what if you become incapacitated? What if you develop dementia, have a stroke, or suffer a serious accident?
Without proper planning, your family faces another expensive court process called conservatorship or guardianship. They'll need to petition the court, prove you're incapacitated, and get legal authority to manage your affairs. This process can cost $10,000-$25,000 and take months while your bills go unpaid.
A living trust solves this problem automatically. Your successor trustee can immediately step in to pay your bills, manage your investments, and handle your financial affairs according to your written instructions. No court involvement. No expensive legal proceedings. No delays.
I remember Margaret, an 82-year-old widow from Venice, Florida. She had a stroke that left her unable to manage her finances, but her living trust allowed her daughter to seamlessly take over. Within 48 hours, her daughter was paying bills, managing rental property, and ensuring Margaret's care expenses were covered – all without stepping foot in a courthouse.
Benefit #4 - Tax Planning and Asset Protection (The Complete Package)
A living trust isn't just one document – it's the centerpiece of a comprehensive estate plan that can include significant tax savings and asset protection strategies.
For married couples, we can build in provisions that could save your family hundreds of thousands in estate taxes. For business owners, we can create succession plans that keep your company running smoothly. For families with significant assets, we can add layers of protection against lawsuits and creditors.
The Supporting Cast: Other Essential Documents
Your living trust works alongside other critical documents:
- Pour-over will: Catches any assets you forgot to put in the trust
- Financial powers of attorney: Ensures your family can manage your finances during any period you are incapacitated
- Healthcare directives and living wills: Ensures your family knows your wishes for medical treatment
- HIPAA authorizations: Allows family to access your medical information
Together, these documents create a legally enforceable plan that protects you during your lifetime and your family after you're gone.
The Truth About Cost: Why Living Trusts Are Actually Cheaper
I often hear people say, "Living trusts are too expensive." This tells me they're looking at the upfront cost instead of the total cost.
Yes, a living trust costs more initially than a simple will – typically around a thousand dollars more for the same will-based plan. But here's what that comparison misses: while wills are generally cheaper than a trust to set up, the will goes through probate which can cost anywhere from $6,000-$10,000, or more. A trust is a larger initial investment, but avoids probate.
The living trust could save your family thousands of dollars overall, while providing significantly better protection and privacy.
Benefit #5 – The Right Trust Can Protect Your Home and Life Savings from Nursing Home and Long-Term Care Costs
A 2019 report published by the federal Department of Health and Human Services titled, “What Is the Lifetime Risk of Needing and Receiving Long-Term Services and Support”, states that 70% of adults who survive to age 65 develop severe long-term care needs. And at the time of this article, the average cost for a nursing home in Minnesota is over $146,000 a year, and in Florida is over $120,000 a year. These costs can quickly wipe out a lifetime of savings for the average middle-class family.
However, utilizing the proper planning strategies, such as a Medicaid Asset Protection Trust, Qualified Income Trusts and other tools, you can legally protect your home and life savings from long-term care and nursing home costs while receiving the care you need. If you would like to discover more about how to protect your home and life savings from long-term care and nursing home costs, here are two resources for you:
Download your copy of my guide, “Save Our Home: How to Protect Your Home and Life Savings from Long-Term Care and Nursing Home Costs” by clicking here.
Join us in my upcoming exclusive masterclass where I reveal strategies I use with my private clients to help them protect their home and life savings from nursing home and long-term care costs. Click here to sign up.
Don't Wait Until It's Too Late: Common Excuses That Cost Families Everything
In my 30 years of practice, I've heard every excuse for delaying estate planning:
- "I'm too young to worry about this" – Ask Sarah's family if they think her 58-year-old father was too young
- "I don't have enough money" – If you own a home and have retirement accounts, you have enough to create problems for your family
- "I'll get to it someday" – Someday has a way of never coming
- “We already did this a few years ago” – If your estate plan is more than 5 years old, it may need to be updated due to changes in your life, your family circumstances, tax and other changes in the law
- "It's too complicated" – It's far less complicated than the mess you'll leave without proper planning
The truth is, every day you delay puts your family at risk. Every day you wait is another day your assets remain vulnerable to probate costs, creditor claims, and family disputes.
Your Next Steps: Protecting Your Family's Future
If you recognize your family in these scenarios, it's time to take action. The good news is that creating a comprehensive plan doesn't have to be overwhelming or impossibly expensive.
As someone who has helped thousands of families protect their legacies over the past three decades, I can guide you through this process efficiently and affordably. Whether you're starting from scratch or need to update an existing plan that no longer serves your family's needs, we can create a strategy tailored to your specific situation.
Take Action Today
Don't let your family become another cautionary tale. Contact our office today to schedule a consultation at either (941) 909-4644 for our Florida office or at (763) 420-5087 for our Minnetonka, Minnesota office. You can also fill out the contact form on this page, and a member of our team will reach out to schedule your consultation at your convenience.
Want to Discover More Advanced Strategies?
If you'd like to discover the strategies I use with my private clients to help them avoid probate, minimize taxes, protect their children's inheritance from divorce and creditors, much more, I invite you to join my upcoming masterclass.
In this exclusive session, I'll reveal advanced planning techniques typically reserved for my highest-net-worth clients, including strategies that can save your family hundreds of thousands of dollars in taxes and protect your legacy for generations. Click here to sign up.
Remember, the best estate plan is the one you actually complete. Your family is counting on you to make the right decision. Don't leave their future to chance – or to a government-written plan you'd never choose.
The time to act is now. Your family's financial security depends on it.
