Put checking accounts in living revocable trusts?

[rcjchicity]

DH and I are setting up a living revocable trust, and are unsure what to do about our individual and joint checking accounts. Our estate attorney says those at his firm normally doesn't put personal checking accounts into revocable trusts, but he knows others do, and feels it's a personal preference.

For background, DH and I are 40/38 y/o, respectively, and have a 1 year old daughter and hope to have 1 more. We live in Illinois.

From the revocable living trust I had when I was single which included my checking account, I know that it's a pain to get them out of trusts since I had to close that long-standing account and open a new one (bye-bye unused Bank One checks with my maiden name still on them)

Reading previous threads on this site, it seems like people are split in terms of having them in or out of revocable trusts.

My concern is in the situation where one spouse dies and the other is incapacitated, that the successor trustee can access all pertinent accounts to support our child(ren) and pay our ongoing bills as necessary. Our attorney says the Power of Attorney would have the ability to do this with the accounts not in the trust.

Has anyone had experience as a successor trustee/POA in this type of situation and feel that one way is more efficient than the other?

Thx

[rixer]

I was the successor trustee for the inlaws. They had the checking account listed under the trust so I don't know how it would have been handled if it wasn't. At any rate, the m/l passed first and later the f/l was incapacitated by alzhiemers. I just had to furnish death certificate for m/l and two doctor's letters verifying that the f/l was incapacitated and could no longer handle his financial accounts. The banks accounts were then put in my name as the trustee and I had full control. It wasn't too difficult.

[Longdog]

If I were going through the effort to create a revocable living trust with specific goals in mind, I would include every financial account within the trust, unless there was a specific goal to achieve (that wouldn't be accomplished by the trust) by doing otherwise. What would the purpose be for NOT having your checking account in the trust?

[Sheepdog]

When my wife and I funded our revocable trust, our lawyer firmly told us NOT to include the checking account. The reason was that access to the checking account by the survivor may not be immediately possible at our individual death. He suggested that we keep that as a joint account. All other assets are titled to the trust.
He also suggested that we add our successor trustee's (in our case, a son) signature be added to that checking account so that, if we both pass together, or soon after, or otherwise be incapacitated, he could have access to the checking account to pay bills, etc.

[Leesbro63]

When my wife and I funded our revocable trust, our lawyer firmly told us NOT to include the checking account. The reason was that access to the checking account by the survivor may not be immediately possible at our individual death. He suggested that we keep that as a joint account. All other assets are titled to the trust.
He also suggested that we add our successor trustee's (in our case, a son) signature be added to our checking account so that, if we both pass together, or soon after, he could have access to the checking account to pay bills, etc.

Also, do you really want everyone who receives a check to know that you are a "rich trust fund person"? Yeah, checks are becoming less and less used and we Bogleheads understand that you don't have to be Warren Buffett to benefit from a trust. But to the average Joe, it can send the wrong message.

[cadreamer2015]

If the OP wants to maintain separate checking accounts, perhaps they could be POD if they want to avoid putting them inside their trusts.

[sport]

Also, do you really want everyone who receives a check to know that you are a "rich trust fund person"? Yeah, checks are becoming less and less used and we Bogleheads understand that you don't have to be Warren Buffett to benefit from a trust. But to the average Joe, it can send the wrong message.

There is a similar concern about putting vehicles into a trust. Do you want the officer that stops you for a traffic offense to know that you are "a rich trust fund person"? You might not get much sympathy or leeway from that officer if he/she is a jealous type of person.

[mjdaniel]

My wife was trustee and power of attorney for her mother's trust, which did not contain her checking account. I was executor and my sister was power of attorney for my mother's will. Last year each of us lost our mom's and we both sold homes and distributed the proceeds according to our mother's will and trust without any gliches.

[littlebird]

When my wife and I funded our revocable trust, our lawyer firmly told us NOT to include the checking account. The reason was that access to the checking account by the survivor may not be immediately possible at our individual death. He suggested that we keep that as a joint account. All other assets are titled to the trust.
He also suggested that we add our successor trustee's (in our case, a son) signature be added to our checking account so that, if we both pass together, or soon after, he could have access to the checking account to pay bills, etc.

Also, do you really want everyone who receives a check to know that you are a "rich trust fund person"? Yeah, checks are becoming less and less used and we Bogleheads understand that you don't have to be Warren Buffett to benefit from a trust. But to the average Joe, it can send the wrong message.

I keep our checking account in our trust. But I can see Sheepdog's lawyer's point also. It's pretty much a crapshoot as to which roadblocks are going to pop up at the time your need arises. There's a lot of flux in banking and finance administration right now (maybe always was?)

Also -- it is NOT necessary for the face of the check to reflect that it is a trust account. Only your bank need know. Your checks can simply be imprinted with both your names, just as if it were an ordinary joint account.

[sport]

Also -- it is NOT necessary for the face of the check to reflect that it is a trust account. Only your bank need know. Your checks can simply be imprinted with both your names, just as if it were an ordinary joint account.

Will the bank require that the word "trustee" is part of the signature, such as "John Anyname, trustee"?

[rcjchicity]

OP here.

My previous checking account only showed that it was a part of my old trust on the statements. My checks, debit cards, etc only had my name. My name was only required in the signature, too. So it's not a concern that including checking accounts would "advertise" having a trust, other than to the mailman (sans e-statements). And the people at Chase would not have been impressed with my average daily balances to think I was fancy.

That old trust was a DIY Suze Orman thing, so I don't think the same steps I took before are necessarily appropriate in my current situation.

It sounds like we could go either way and things would probably be ok. POD is another thing to consider.

[corn18]

When my wife and I funded our revocable trust, our lawyer firmly told us NOT to include the checking account. The reason was that access to the checking account by the survivor may not be immediately possible at our individual death. He suggested that we keep that as a joint account. All other assets are titled to the trust.
He also suggested that we add our successor trustee's (in our case, a son) signature be added to that checking account so that, if we both pass together, or soon after, or otherwise be incapacitated, he could have access to the checking account to pay bills, etc.

^^^This. My FIL just passed and had the checking account outside the trust with his wife and 2 grown kids as joint owners. Good thing he did because it is taking forever to get the assets in his trust assigned to her trust. If the checking account were in his trust, she wouldn't have anything to live on right now.

We are keeping the checking, savings and vehicles outside the trust.

Oh and do you have to be rich to have a trust? I didn't see that on the application.

Tom

[littlebird]

Also -- it is NOT necessary for the face of the check to reflect that it is a trust account. Only your bank need know. Your checks can simply be imprinted with both your names, just as if it were an ordinary joint account.

Will the bank require that the word "trustee" is part of the signature, such as "John Anyname, trustee"?

Not in my experience

[littlebird]

When my wife and I funded our revocable trust, our lawyer firmly told us NOT to include the checking account. The reason was that access to the checking account by the survivor may not be immediately possible at our individual death. He suggested that we keep that as a joint account. All other assets are titled to the trust.
He also suggested that we add our successor trustee's (in our case, a son) signature be added to that checking account so that, if we both pass together, or soon after, or otherwise be incapacitated, he could have access to the checking account to pay bills, etc.

^^^This. My FIL just passed and had the checking account outside the trust with his wife and 2 grown kids as joint owners. Good thing he did because it is taking forever to get the assets in his trust assigned to her trust. If the checking account were in his trust, she wouldn't have anything to live on right now.

We are keeping the checking, savings and vehicles outside the trust.

Oh and do you have to be rich to have a trust? I didn't see that on the application.

Tom

Transferring assets from one trust to another after death is a cumbersome procedure which can take time. The best use of a living trust (in my opinion) is to make it easy for someone to take over money management for you when you become disabled. To that end, you generally name a successor trustee for your trust and this transition should be fairly easy and, I believe, that the type of transaction the OP is contemplating.

[Buffetologist]

Our checking account is a joint-tenancy with right of survivorship (JTWROS) in trust for our living trust. In other words, our trust is the beneficiary if both of us die. This way we avoid probate, but also avoid any complications while both of us live.

[snackdog]

I guess depending on the state in which you reside, if your non-trust assets (such as your checking/savings account) exceed a threshold it will trigger probate.

[FIREchief]

I think a lot of folks (including the lawyers) are overthinking this. Just retitle the checking account to the trust and be done with it. It can't hurt and may only make things simpler for your successor trustees/heirs in the future.

[FIREchief]

Our checking account is a joint-tenancy with right of survivorship (JTWROS) in trust for our living trust. In other words, our trust is the beneficiary if both of us die. This way we avoid probate, but also avoid any complications while both of us live.

Unless you wind up in a situation neither one is alive/capacitated and the bank refuses to honor your DPOA. We hear many reports of this, despite the fact that such refusal typically violates state laws.

[J295]

Just a matter of preference. Many like to keep it simple with
a joint checking account with a POD, and expect to rely upon the power of attorney if needed.

[cchrissyy]

I would put the trust as the beneficiary of the checking account, and i would not be worried about the trustee needing access to it while I'm incapacitated but still alive because there is also power of attorney paperwork which gives the right person the ability to access my accounts in that exact situation.

[JaneyLH]

I would put the trust as the beneficiary of the checking account, and i would not be worried about the trustee needing access to it while I'm incapacitated but still alive because there is also power of attorney paperwork which gives the right person the ability to access my accounts in that exact situation.

You should worry, a lot.

My husband assumed a POA responsibilities for his 97 year-old father in March, 2019. The older brother had been named POA with my husband as secondary in case the older brother could or would not carry out the responsibilities. As soon as FIL developed dementia, older brother renounced. We stepped in and have battled to get my husband’s POA status recognized ever since with 5 different financial institutions. We have spent hundreds of hours, gotten notarizations, gold medallion stamps (at great difficulty and expense), made dozens of phone calls.

We still aren’t done — one bank, which recognized POA for a checking account, is now digging in their heels 8 months later and refusing to act on my husband’s request to cash out two CDs we just found out about. They still insist that the elder brother is the POA for those accounts despite having had all the correct paperwork for nearly a year.

We have been told we have to come into a branch — the nearest one is 1800 miles away. We have been told that the 97-year-old with dementia must sign the bank’s form or call them directly. We can’t get access to accounts unless we know the account numbers. We have had to become amateur detectives to try and track down information.

Meanwhile, FIL is in a nursing home of his choosing that is billing $15,000 a month... and if we run out of money and we can’t gain legal access to his remaining funds, he won’t be eligible for Medicaid because he will still have untapped assets! This is an amazing mess that we have been in for more than a year!

Bottom line, you should understand that banks are not compelled to recognize even legally executed POA documents. If you plan to rely on a your agent being able to access your accounts in the event of your incapacitation, SET THIS UP WITH YOUR FINANCIAL INSTITUTIONS IN ADVANCE! ON THEIR FORMS! Otherwise, your agent might have to pursue a court order to force recognition of the POA.

FYI, Capital One, TD Bank, and Deutsche Bank have been the worst to deal with. Vanguard was the easiest — but they only had one account of $2700.

[nesdog]

Also -- it is NOT necessary for the face of the check to reflect that it is a trust account. Only your bank need know. Your checks can simply be imprinted with both your names, just as if it were an ordinary joint account.
[/quote]

This. We put ours in the trust. Only our statement reflect that info. The checks remained the same as always.

[RetiredAL]

You should worry, a lot.

My husband assumed a POA responsibilities for his 97 year-old father in March, 2019. The older brother had been named POA with my husband as secondary in case the older brother could or would not carry out the responsibilities. As soon as FIL developed dementia, older brother renounced. We stepped in and have battled to get my husband’s POA status recognized ever since with 5 different financial institutions. We have spent hundreds of hours, gotten notarizations, gold medallion stamps (at great difficulty and expense), made dozens of phone calls.

We still aren’t done — one bank, which recognized POA for a checking account, is now digging in their heels 8 months later and refusing to act on my husband’s request to cash out two CDs we just found out about. They still insist that the elder brother is the POA for those accounts despite having had all the correct paperwork for nearly a year.

We have been told we have to come into a branch — the nearest one is 1800 miles away. We have been told that the 97-year-old with dementia must sign the bank’s form or call them directly. We can’t get access to accounts unless we know the account numbers. We have had to become amateur detectives to try and track down information.

Meanwhile, FIL is in a nursing home of his choosing that is billing $15,000 a month... and if we run out of money and we can’t gain legal access to his remaining funds, he won’t be eligible for Medicaid because he will still have untapped assets! This is an amazing mess that we have been in for more than a year!

Bottom line, you should understand that banks are not compelled to recognize even legally executed POA documents. If you plan to rely on a your agent being able to access your accounts in the event of your incapacitation, SET THIS UP WITH YOUR FINANCIAL INSTITUTIONS IN ADVANCE! ON THEIR FORMS! Otherwise, your agent might have to pursue a court order to force recognition of the POA.

FYI, Capital One, TD Bank, and Deutsche Bank have been the worst to deal with. Vanguard was the easiest — but they only had one account of $2700.

I'd add Wells Fargo to the worst list. I've recently had issues getting them to accept their own forms for adding my son as agent to the Checking/Saving accounts that is joint between me and my elderly Dad.

[MathIsMyWayr]

When my wife and I funded our revocable trust, our lawyer firmly told us NOT to include the checking account. The reason was that access to the checking account by the survivor may not be immediately possible at our individual death. He suggested that we keep that as a joint account. All other assets are titled to the trust.
He also suggested that we add our successor trustee's (in our case, a son) signature be added to that checking account so that, if we both pass together, or soon after, or otherwise be incapacitated, he could have access to the checking account to pay bills, etc.

Against what I learned from a trust seminar by a CA lawyer. According to him, a joint account will be frozen the moment a spouse is incapacitated or dies. On the other hand, such an event has no effect on a trust.

[MathIsMyWayr]

Also -- it is NOT necessary for the face of the check to reflect that it is a trust account. Only your bank need know. Your checks can simply be imprinted with both your names, just as if it were an ordinary joint account.

This. We put ours in the trust. Only our statement reflect that info. The checks remained the same as always.
[/quote]
Same in our bank accounts.

[phxjcc]

You should worry, a lot.

My husband assumed a POA responsibilities for his 97 year-old father in March, 2019. The older brother had been named POA with my husband as secondary in case the older brother could or would not carry out the responsibilities. As soon as FIL developed dementia, older brother renounced. We stepped in and have battled to get my husband’s POA status recognized ever since with 5 different financial institutions. We have spent hundreds of hours, gotten notarizations, gold medallion stamps (at great difficulty and expense), made dozens of phone calls.

We still aren’t done — one bank, which recognized POA for a checking account, is now digging in their heels 8 months later and refusing to act on my husband’s request to cash out two CDs we just found out about. They still insist that the elder brother is the POA for those accounts despite having had all the correct paperwork for nearly a year.

We have been told we have to come into a branch — the nearest one is 1800 miles away. We have been told that the 97-year-old with dementia must sign the bank’s form or call them directly. We can’t get access to accounts unless we know the account numbers. We have had to become amateur detectives to try and track down information.

Meanwhile, FIL is in a nursing home of his choosing that is billing $15,000 a month... and if we run out of money and we can’t gain legal access to his remaining funds, he won’t be eligible for Medicaid because he will still have untapped assets! This is an amazing mess that we have been in for more than a year!

Bottom line, you should understand that banks are not compelled to recognize even legally executed POA documents. If you plan to rely on a your agent being able to access your accounts in the event of your incapacitation, SET THIS UP WITH YOUR FINANCIAL INSTITUTIONS IN ADVANCE! ON THEIR FORMS! Otherwise, your agent might have to pursue a court order to force recognition of the POA.

FYI, Capital One, TD Bank, and Deutsche Bank have been the worst to deal with. Vanguard was the easiest — but they only had one account of $2700.

I'd add Wells Fargo to the worst list. I've recently had issues getting them to accept their own forms for adding my son as agent to the Checking/Saving accounts that is joint between me and my elderly Dad.

Add US BANK to the list. Not a big deal...unless mom/dad had an account at the old HOME SAVINGS and LOAN, then good luck.

And most certainly do NOT add checking to the trust. I hasten to add get your relatives to open a checking account with a nice little bank. The nationals are a PITA to work with.

[FIREchief]

Many like to keep it simple with a joint checking account with a POD, and expect to rely upon the power of attorney if needed.

Why is that any simpler than just retitling the checking account to the trust? I think it took us about ten minutes at the local branch.

Also, see the countless posts about banks refusing to honor properly executed DPOAs. That certainly doesn't sound "simple."

[Planner01]

So if you exclude your checking and retirement accounts and vehicles from the trust, then that only leaves the house, savings and taxable accounts to add to the trust. Why bother setting up a trust then if so much should be excluded?

[MathIsMyWayr]

Also, do you really want everyone who receives a check to know that you are a "rich trust fund person"? Yeah, checks are becoming less and less used and we Bogleheads understand that you don't have to be Warren Buffett to benefit from a trust. But to the average Joe, it can send the wrong message.

There is a similar concern about putting vehicles into a trust. Do you want the officer that stops you for a traffic offense to know that you are "a rich trust fund person"? You might not get much sympathy or leeway from that officer if he/she is a jealous type of person.

Time to learn about what a living trust is.

[FIREchief]

Also, do you really want everyone who receives a check to know that you are a "rich trust fund person"? Yeah, checks are becoming less and less used and we Bogleheads understand that you don't have to be Warren Buffett to benefit from a trust. But to the average Joe, it can send the wrong message.

There is a similar concern about putting vehicles into a trust. Do you want the officer that stops you for a traffic offense to know that you are "a rich trust fund person"? You might not get much sympathy or leeway from that officer if he/she is a jealous type of person.

Time to learn about what a living trust is.

I recommend that you ignore comments such as the ones you responded to. Having a living trust shouldn't convey the image of great wealth to anyone. They are very common, and I highly doubt that a traffic officer would have any interest whatsoever. I think this is just something made up on the internet. In our country today, in many scenarios, if you actually have current registration and insurance, it likely suggests that you have a decent income.

[sport]

Also, do you really want everyone who receives a check to know that you are a "rich trust fund person"? Yeah, checks are becoming less and less used and we Bogleheads understand that you don't have to be Warren Buffett to benefit from a trust. But to the average Joe, it can send the wrong message.

There is a similar concern about putting vehicles into a trust. Do you want the officer that stops you for a traffic offense to know that you are "a rich trust fund person"? You might not get much sympathy or leeway from that officer if he/she is a jealous type of person.

Time to learn about what a living trust is.

I recommend that you ignore comments such as the ones you responded to. Having a living trust shouldn't convey the image of great wealth to anyone. They are very common, and I highly doubt that a traffic officer would have any interest whatsoever. I think this is just something made up on the internet. In our country today, in many scenarios, if you actually have current registration and insurance, it likely suggests that you have a decent income.

Well, I wrote that 5 years ago, and I still feel it is a valid concern. There is a big difference between having "a decent income" and having assets so substantial that you would put them in a trust. BTW, that is my own thought, not something I read "on the internet".

[Nowizard]

We have put Successor Trustees on bank accounts and anything else that represents available funds such as brokerage accounts. That means they will have immediate access to funds to pay final expenses and others without using their funds. We might have done otherwise is the Successor Trustees were not trusted sources, our two sons. Our Trust was established after seeing how easy it made settling the very small estate of a parent, not due to common perceptions of only the wealthy having one. It is sometimes cringeworthy when mail or other notifications arrive with the address including the word "Trust" since we are not wealthy by many standards.

Tim

[FIREchief]

We have put Successor Trustees on bank accounts and anything else that represents available funds such as brokerage accounts.

Are those accounts owned by your trust or by you individually?

[MathIsMyWayr]

Also, do you really want everyone who receives a check to know that you are a "rich trust fund person"? Yeah, checks are becoming less and less used and we Bogleheads understand that you don't have to be Warren Buffett to benefit from a trust. But to the average Joe, it can send the wrong message.

There is a similar concern about putting vehicles into a trust. Do you want the officer that stops you for a traffic offense to know that you are "a rich trust fund person"? You might not get much sympathy or leeway from that officer if he/she is a jealous type of person.

Time to learn about what a living trust is.

I recommend that you ignore comments such as the ones you responded to. Having a living trust shouldn't convey the image of great wealth to anyone. They are very common, and I highly doubt that a traffic officer would have any interest whatsoever. I think this is just something made up on the internet. In our country today, in many scenarios, if you actually have current registration and insurance, it likely suggests that you have a decent income.

Well, I wrote that 5 years ago, and I still feel it is a valid concern. There is a big difference between having "a decent income" and having assets so substantial that you would put them in a trust. BTW, that is my own thought, not something I read "on the internet".

According to my takeaway from attending trust seminars, one of the main reasons of setting up a living trust is to avoid a probate court. In California, your estate ends up in court if your residence is more than $100k (not sure about the exact figure), not $100k equity. I don't know whether you may be to find a home under $100k in California. It may be a nice pitch for a living trust.

[sport]

There is a similar concern about putting vehicles into a trust. Do you want the officer that stops you for a traffic offense to know that you are "a rich trust fund person"? You might not get much sympathy or leeway from that officer if he/she is a jealous type of person.

Time to learn about what a living trust is.

I recommend that you ignore comments such as the ones you responded to. Having a living trust shouldn't convey the image of great wealth to anyone. They are very common, and I highly doubt that a traffic officer would have any interest whatsoever. I think this is just something made up on the internet. In our country today, in many scenarios, if you actually have current registration and insurance, it likely suggests that you have a decent income.

Well, I wrote that 5 years ago, and I still feel it is a valid concern. There is a big difference between having "a decent income" and having assets so substantial that you would put them in a trust. BTW, that is my own thought, not something I read "on the internet".

According to my takeaway from attending trust seminars, one of the main reasons of setting up a living trust is to avoid a probate court. In California, your estate ends up in court if your residence is more than $100k (not sure about the exact figure), not $100k equity. I don't know whether you may be to find a home under $100k in California. It may be a nice pitch for a living trust.

Thanks for the information. However, my remark was about putting a vehicle in a living trust. In my state we can designate a beneficiary on the car title.

[FIREchief]

Time to learn about what a living trust is.

I recommend that you ignore comments such as the ones you responded to. Having a living trust shouldn't convey the image of great wealth to anyone. They are very common, and I highly doubt that a traffic officer would have any interest whatsoever. I think this is just something made up on the internet. In our country today, in many scenarios, if you actually have current registration and insurance, it likely suggests that you have a decent income.

Well, I wrote that 5 years ago, and I still feel it is a valid concern. There is a big difference between having "a decent income" and having assets so substantial that you would put them in a trust. BTW, that is my own thought, not something I read "on the internet".

According to my takeaway from attending trust seminars, one of the main reasons of setting up a living trust is to avoid a probate court. In California, your estate ends up in court if your residence is more than $100k (not sure about the exact figure), not $100k equity. I don't know whether you may be to find a home under $100k in California. It may be a nice pitch for a living trust.

Thanks for the information. However, my remark was about putting a vehicle in a living trust. In my state we can designate a beneficiary on the car title.

My state only allows that if the title is in the name of a single individual. It can be co-owned by husband, wife and trust; with any of those able to sell or retitle. Trust has an ownership interest on insurance. Seems the most flexible, as successor trustee can take out insurance or easily sell.

[afan]

I took over affairs for an elderly person. They had put almost all of their assets into their living trust with me as co trustee. This was set up before I was needed. The checking account was in the trust. It was seamless. I started paying bills from the checking account with no problems.

The small amounts that were no in trust were major hassles. Same story with companies refusing to accept the DPOA. Fortunately, the person was still able to close accounts and transfer assets to the trust. Until we hit in that solution, we went through the same thing with being told to go to individual bank branches. The DPOA probably would have been useful for something but I never found any institution that would accept it.

We don't have our checking account in the trust but we don't have much money in there either.

[ChrisC]

As an elderly couple, we have all of our checking, savings and CD accounts titled in our revocable living trusts. These are all joint accounts, anyway, and the checking accounts still bear our names, not the trust, on issued checks. We also have POAs; we titled these bank accounts in the trust simply to make it easier for our successor trustees, our children, to navigate our financial affairs when the last one of us standing departed from the scene.

Both financial institutions, Navy Federal CU and Wells Fargo, re-titled them for us with a modest level of paperwork -- though I think a lot of this depends on the customer service representative's skill level and knowledge of internal banking procedures, for instance, one branch level staffer at Wells Fargo told us we couldn't do this -- another one a few months later handled the entire process within 30 minutes, as well as POAs for another matter involving my BIL!

Each banking institution, as well as its retail customer service representatives, has its own quirky procedures. With PNC, one POA we had was good for them, whereas the same POA was considered deficient for Wells Fargo. Navy Federal advised us that successor trustees had to be members of Navy Federal to keep the accounts in the trust once we were gone or else they would close them out and distribute funds in the name of the trust. Wells Fargo did not care about the successor trustee. For a banking account we established for an Irrevocable Trust, Fifth Third Bank required a copy of the EIN letter from the IRS and specific trust documents designating the successor trustees.

I believe there are good reasons to re-title assets, even those initially jointly held by a couple, in revocable living trusts to make it easy for successor trustees, if that is one of your goals.

[unclescrooge]

I was the successor trustee for the inlaws. They had the checking account listed under the trust so I don't know how it would have been handled if it wasn't. At any rate, the m/l passed first and later the f/l was incapacitated by alzhiemers. I just had to furnish death certificate for m/l and two doctor's letters verifying that the f/l was incapacitated and could no longer handle his financial accounts. The banks accounts were then put in my name as the trustee and I had full control. It wasn't too difficult.

What sort of doctor does it need to be? Any type, or a psychiatrist? How does one go about long for such a doctor?

[Seasonal]

When my wife and I funded our revocable trust, our lawyer firmly told us NOT to include the checking account. The reason was that access to the checking account by the survivor may not be immediately possible at our individual death. He suggested that we keep that as a joint account. All other assets are titled to the trust.
He also suggested that we add our successor trustee's (in our case, a son) signature be added to that checking account so that, if we both pass together, or soon after, or otherwise be incapacitated, he could have access to the checking account to pay bills, etc.

Against what I learned from a trust seminar by a CA lawyer. According to him, a joint account will be frozen the moment a spouse is incapacitated or dies. On the other hand, such an event has no effect on a trust.

This doesn't make sense to me. The idea of a Joint Tenant With Right of Survivorship account is that it passes to the survivor upon the death of the other person.

I did a quick google search to see if there was anything odd about CA law. "What is the right of survivorship? When a joint tenant dies, his or her interest in the asset vests in the surviving joint tenant or joint tenants. In other words, if two people own real estate in joint tenancy, and one of them dies, the surviving joint tenant then owns 100 percent of the property." https://www.ca-trusts.com/jointtenancy.html

Since that is exactly how I thought things would work, I didn't look further.

[RudyS]

When my wife and I funded our revocable trust, our lawyer firmly told us NOT to include the checking account. The reason was that access to the checking account by the survivor may not be immediately possible at our individual death. He suggested that we keep that as a joint account. All other assets are titled to the trust.
He also suggested that we add our successor trustee's (in our case, a son) signature be added to that checking account so that, if we both pass together, or soon after, or otherwise be incapacitated, he could have access to the checking account to pay bills, etc.

Against what I learned from a trust seminar by a CA lawyer. According to him, a joint account will be frozen the moment a spouse is incapacitated or dies. On the other hand, such an event has no effect on a trust.

This doesn't make sense to me. The idea of a Joint Tenant With Right of Survivorship account is that it passes to the survivor upon the death of the other person.

I did a quick google search to see if there was anything odd about CA law. "What is the right of survivorship? When a joint tenant dies, his or her interest in the asset vests in the surviving joint tenant or joint tenants. In other words, if two people own real estate in joint tenancy, and one of them dies, the surviving joint tenant then owns 100 percent of the property." https://www.ca-trusts.com/jointtenancy.html

Since that is exactly how I thought things would work, I didn't look further.

The interesting thing is that this was presented at a seminar intended to sell TRUSTS! (Bold type above is mine).

[Seasonal]

When my wife and I funded our revocable trust, our lawyer firmly told us NOT to include the checking account. The reason was that access to the checking account by the survivor may not be immediately possible at our individual death. He suggested that we keep that as a joint account. All other assets are titled to the trust.
He also suggested that we add our successor trustee's (in our case, a son) signature be added to that checking account so that, if we both pass together, or soon after, or otherwise be incapacitated, he could have access to the checking account to pay bills, etc.

Against what I learned from a trust seminar by a CA lawyer. According to him, a joint account will be frozen the moment a spouse is incapacitated or dies. On the other hand, such an event has no effect on a trust.

This doesn't make sense to me. The idea of a Joint Tenant With Right of Survivorship account is that it passes to the survivor upon the death of the other person.

I did a quick google search to see if there was anything odd about CA law. "What is the right of survivorship? When a joint tenant dies, his or her interest in the asset vests in the surviving joint tenant or joint tenants. In other words, if two people own real estate in joint tenancy, and one of them dies, the surviving joint tenant then owns 100 percent of the property." https://www.ca-trusts.com/jointtenancy.html

Since that is exactly how I thought things would work, I didn't look further.

The interesting thing is that this was presented at a seminar intended to sell TRUSTS! (Bold type above is mine).

Yes, I noticed that. Even though the site I linked is a trusts site, it at least accurately reports how a JTWROS works. Only if both joint tenants die will the account be frozen, and even then the bank would have to know of the deaths.

[rixer]

I was the successor trustee for the inlaws. They had the checking account listed under the trust so I don't know how it would have been handled if it wasn't. At any rate, the m/l passed first and later the f/l was incapacitated by alzhiemers. I just had to furnish death certificate for m/l and two doctor's letters verifying that the f/l was incapacitated and could no longer handle his financial accounts. The banks accounts were then put in my name as the trustee and I had full control. It wasn't too difficult.

What sort of doctor does it need to be? Any type, or a psychiatrist? How does one go about long for such a doctor?

We just made an appointment with his regular doctor. Then, he referred us to a neurologist and they did a brain scan which can show areas of dementia.

[Leesbro63]

I was the successor trustee for the inlaws. They had the checking account listed under the trust so I don't know how it would have been handled if it wasn't. At any rate, the m/l passed first and later the f/l was incapacitated by alzhiemers. I just had to furnish death certificate for m/l and two doctor's letters verifying that the f/l was incapacitated and could no longer handle his financial accounts. The banks accounts were then put in my name as the trustee and I had full control. It wasn't too difficult.

What sort of doctor does it need to be? Any type, or a psychiatrist? How does one go about long for such a doctor?

We just made an appointment with his regular doctor. Then, he referred us to a neurologist and they did a brain scan which can show areas of dementia.

I thought dementia can’t be diagnosed by imaging?

[Seasonal]

I was the successor trustee for the inlaws. They had the checking account listed under the trust so I don't know how it would have been handled if it wasn't. At any rate, the m/l passed first and later the f/l was incapacitated by alzhiemers. I just had to furnish death certificate for m/l and two doctor's letters verifying that the f/l was incapacitated and could no longer handle his financial accounts. The banks accounts were then put in my name as the trustee and I had full control. It wasn't too difficult.

What sort of doctor does it need to be? Any type, or a psychiatrist? How does one go about long for such a doctor?

We just made an appointment with his regular doctor. Then, he referred us to a neurologist and they did a brain scan which can show areas of dementia.

I thought dementia can’t be diagnosed by imaging?

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3937983/

https://stanfordhealthcare.org/medical- ... scans.html

[afan]

Far better to appoint a co trustee than a successor. With a successor, they would need to prove that the thing that triggers their status to trustee has occurred. You may or may not be able to get a doctor to go along.
With a co trustee you bypass this problem.
While you are healthy and managing your own affairs there is nothing for the co trustee to do. Once you become incapacitated, the co trustee can act without needing to prove anything to the the financial institutions.

[Luckywon]

Far better to appoint a co trustee than a successor. With a successor, they would need to prove that the thing that triggers their status to trustee has occurred. You may or may not be able to get a doctor to go along.
With a co trustee you bypass this problem.
While you are healthy and managing your own affairs there is nothing for the co trustee to do. Once you become incapacitated, the co trustee can act without needing to prove anything to the the financial institutions.

Agree with this and another option is to make it reasonably easy for your successor trustees to assume powers. The default for many Trusts is two physician attestation. This could be changed to one physician. Or the successor trustee could determine incapacity fo the predecessor and state so in a sworn affidavit. Or a third party, i.e. trust protector could be given the the power to determine incapacity of the trust settlor.

[LeftCoast]

Our checking account has been in the name of our living trust for the last 25 years. We've never had a problem. We expect that our structure will avoid probate and function well in the event one or both of us becomes disabled.

You should never rely upon a bank to honor a Power of Attorney to take control of a checking account. Banks are justifiably concerned about fraud, forgery, coercion and elder abuse, and may simply refuse to act upon a Power of Attorney that isn't on their form and signed in front of them.

[littlebird]

Also, do you really want everyone who receives a check to know that you are a "rich trust fund person"? Yeah, checks are becoming less and less used and we Bogleheads understand that you don't have to be Warren Buffett to benefit from a trust. But to the average Joe, it can send the wrong message.

There is a similar concern about putting vehicles into a trust. Do you want the officer that stops you for a traffic offense to know that you are "a rich trust fund person"? You might not get much sympathy or leeway from that officer if he/she is a jealous type of person.

I’ve never had the word “trust” on my Trust checks. Just my and spouse’s name when he was alive, now my and co-trustee daughter‘s name. Looks just like checks from a joint account. Bank doesn’t care.

Since my purpose for having a revocable trust was to enable my daughter to step in when I became unable or unwilling to manage my money, it would make no sense not to have the checking account titled the exact same way as brokerage and other financial accounts. Especially since I ran into a problem with V. when spouse’s IRA was, by definition, not in our trust name, and they therefore refused to allow me to deposit his RMDs into the trust using their own POA.