DIY amendment to Trust?

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Luckywon
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DIY amendment to Trust?

Post by Luckywon » Wed May 01, 2019 12:00 pm

I have previously used an attorney to create and amend my revocable living trust. Previous Amendment was to change beneficiaries. I am thinking of drafting another Amendment myself, again to change the beneficiary designations, using the previous Amendment as a template. I am a California resident. Would appreciate hearing thoughts on whether this is a reasonable approach or is a bad idea.

Grt2bOutdoors
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Re: DIY amendment to Trust?

Post by Grt2bOutdoors » Wed May 01, 2019 12:06 pm

Is there anything in the Trust itself and/or the amendment that cross-reference each other? Your modification may be determined to be invalid because it does not satisfy the terms of the trust. I'm not an attorney, but when modifying contracts I prefer to have qualified counsel do the work, they do this for a living and if anything goes wrong you have recourse. You do it yourself, you become deceased and if trust is invalidated, now your heirs have a real pickle on their hands. JMO.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

Topic Author
Luckywon
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Re: DIY amendment to Trust?

Post by Luckywon » Wed May 01, 2019 12:36 pm

Grt2bOutdoors wrote:
Wed May 01, 2019 12:06 pm
Is there anything in the Trust itself and/or the amendment that cross-reference each other? Your modification may be determined to be invalid because it does not satisfy the terms of the trust. I'm not an attorney, but when modifying contracts I prefer to have qualified counsel do the work, they do this for a living and if anything goes wrong you have recourse. You do it yourself, you become deceased and if trust is invalidated, now your heirs have a real pickle on their hands. JMO.
Actually there are already several amendments, some of which modify the beneficiary designations, and indeed there are cross references in each amendment to the prior amendments/Trust. With these amendments as templates it appears straightforward to me to prepare another amendment with the appropriate cross references, but, as you state this may still be wise not to attempt myself. Thanks for your thoughts.

bayview
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Re: DIY amendment to Trust?

Post by bayview » Wed May 01, 2019 2:00 pm

If something is initially done by an attorney, and it seemed worthwhile paying for that, I would leave any amendments to the attorney.

Penny-wise, pound-foolish, I guess.
The continuous execution of a sound strategy gives you the benefit of the strategy. That's what it's all about. --Rick Ferri

Topic Author
Luckywon
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Re: DIY amendment to Trust?

Post by Luckywon » Wed May 01, 2019 2:41 pm

Another wrinkle is that the original attorney is no longer practicing law. I imagine that to have a new attorney draft up the amendment, it would be probably as expensive as creating the trust initially. Seems like a lot of money to pay for a simple Amendment.

fabdog
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Re: DIY amendment to Trust?

Post by fabdog » Wed May 01, 2019 3:09 pm

sounds like you have talked yourself into doing it as a DIY.

I think the opportunity for an unforced error is great, maybe it's as simple as you think, but if it's not, the consequences can be ugly. And you won't be around to sort it out

Maybe a compromise is having it done professionally, and have them do it in a fashion that you can easily change the beneficiaries going forward, by having every reference go to a specific index or codicil, so going forward that's all you have to change

Mike

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Luckywon
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Re: DIY amendment to Trust?

Post by Luckywon » Thu May 02, 2019 1:45 pm

fabdog wrote:
Wed May 01, 2019 3:09 pm
sounds like you have talked yourself into doing it as a DIY.

I think the opportunity for an unforced error is great, maybe it's as simple as you think, but if it's not, the consequences can be ugly. And you won't be around to sort it out

Maybe a compromise is having it done professionally, and have them do it in a fashion that you can easily change the beneficiaries going forward, by having every reference go to a specific index or codicil, so going forward that's all you have to change

Mike
I'm leaning toward DIY but would be very interested in any specific examples of how it could go wrong, and could certainly change my mind based on that. Your suggestion is a very good one though. At some point, I will likely have the Trust restated and at that point I will request that it be restated in a way that beneficiaries changes are as straightforward to do as possible, either by a subsequent attorney or potentially by myself. Thank you!

Katietsu
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Re: DIY amendment to Trust?

Post by Katietsu » Thu May 02, 2019 1:58 pm

Of have done a few minor DIY legal matters and have used a lawyer. Unfortunately, I have usually needed to make corrections to the attorney prepared documents which may make me lean more towards DIY than I otherwise would.

The one issue that has come up is a change in the law. For instance, one state has changed its requirements for a vaiid POA twice in the last decade or so. Had I just replaced the names and signed with a new date, the POA would not have been valid.

smackboy1
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Re: DIY amendment to Trust?

Post by smackboy1 » Thu May 02, 2019 2:20 pm

Luckywon wrote:
Wed May 01, 2019 12:00 pm
I have previously used an attorney to create and amend my revocable living trust. Previous Amendment was to change beneficiaries. I am thinking of drafting another Amendment myself, again to change the beneficiary designations, using the previous Amendment as a template. I am a California resident. Would appreciate hearing thoughts on whether this is a reasonable approach or is a bad idea.
There is no way of anybody on this forum can make any kind of informed judgment. We have not read the original trust, nor the 1st amendment, nor the proposed 2nd amendment. DIY amendment could turn out OK or could have unintended negative consequences - how much do you and the beneficiaries have to lose? The only reasonable recommendation would be to to show the documents to a qualified lawyer and ask their opinion. BTW, any competent estate planning lawyer can do this kind of work, it doesn't need to be the original lawyer who drafted the documents.
Disclaimer: nothing written here should be taken as legal advice, but I did stay at a Holiday Inn Express last night.

neilpilot
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Re: DIY amendment to Trust?

Post by neilpilot » Thu May 02, 2019 4:08 pm

I DIYed an amendment to our revocable trust for a similar reason; change of Successor Trustee as well as some minor changes. Since this was the first amendment and I had no example to copy, I used a template I found on the internet. After I prepared the amendment I paid a lawyer to review the amendment, and although he said the document I prepared was fine he did suggest a few very minor but inconsequential changes. So in my case a DIY amendment would have worked fine.

Two things, although obvious, that you want to be certain to do. First have the amendment signed by both (all) current Trustees and witnessed by a Notary. Second, be sure that anyone that has your original trust document or trust certification document receives a copy of the amendment. In my case a copy went to my mortgage administrator and my FA.

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Luckywon
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Re: DIY amendment to Trust?

Post by Luckywon » Mon May 13, 2019 10:48 am

neilpilot wrote:
Thu May 02, 2019 4:08 pm
I DIYed an amendment to our revocable trust for a similar reason; change of Successor Trustee as well as some minor changes. Since this was the first amendment and I had no example to copy, I used a template I found on the internet. After I prepared the amendment I paid a lawyer to review the amendment, and although he said the document I prepared was fine he did suggest a few very minor but inconsequential changes. So in my case a DIY amendment would have worked fine.

Two things, although obvious, that you want to be certain to do. First have the amendment signed by both (all) current Trustees and witnessed by a Notary. Second, be sure that anyone that has your original trust document or trust certification document receives a copy of the amendment. In my case a copy went to my mortgage administrator and my FA.
I appreciate your input. I'm still considering how to do this and am leaning toward DIY.

J295
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Re: DIY amendment to Trust?

Post by J295 » Mon May 13, 2019 2:43 pm

Smackboy1 is correct.

And, why so many prior amendments?

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Luckywon
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Re: DIY amendment to Trust?

Post by Luckywon » Mon May 13, 2019 4:03 pm

J295 wrote:
Mon May 13, 2019 2:43 pm

And, why so many prior amendments?
Will not be enumerating why for you as your approval or comments on them are not of interest to me, and I cannot think of any good reason why you would inquire about the reasons for them.

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Sandtrap
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Re: DIY amendment to Trust?

Post by Sandtrap » Mon May 13, 2019 5:14 pm

I have had a number of amendments/addendums to a trust.
It was suggested by legal counsel that I do a "restatement of trust" to consolidate everything and make sure there are no conflicts, etc. I'm strongly considering doing so as it will give me a chance to update things as well.
This may or may not work for you depending on what your legal counsel advises.

That said, there was one time that I had drafted a trust addendum on my own to best clarify exactly what I wanted. Legal counsel reviewed it and there were no corrections. After that it was finalized.

CRTR
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Re: DIY amendment to Trust?

Post by CRTR » Mon May 13, 2019 5:28 pm

Luckywon wrote:
Wed May 01, 2019 12:00 pm
I have previously used an attorney to create and amend my revocable living trust. Previous Amendment was to change beneficiaries. I am thinking of drafting another Amendment myself, again to change the beneficiary designations, using the previous Amendment as a template. I am a California resident. Would appreciate hearing thoughts on whether this is a reasonable approach or is a bad idea.
My father did the same thing (template) and wrote his own amendments. We had no problems with the trust even though it was contested by my half-sister. His changes withstood the assault. That being said, I was VERY nervous going through the process because I shared many of the concerns mentioned above but he got away with it . . . the nicer thing for you to do for your heirs would be to pay a lawyer

J295
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Re: DIY amendment to Trust?

Post by J295 » Mon May 13, 2019 10:16 pm

Luckywon » Mon May 13, 2019 3:03 pm

J295 wrote: ↑Mon May 13, 2019 1:43 pm

And, why so many prior amendments?
Will not be enumerating why for you as your approval or comments on them are not of interest to me, and I cannot think of any good reason why you would inquire about the reasons for them.
I was not looking to approve or comment on them, but recognize that facts are important and these facts might (or might not) be pertinent to your initial question. I'm fine not knowing; and signing off.

littlebird
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Re: DIY amendment to Trust?

Post by littlebird » Mon May 13, 2019 11:18 pm

One of my neighbors had a Revocable Trust where the top sheet was headed: “ I wish to make the following changes”. There were lines below. I helped her write “I want to substitute my grandson Joseph Jones as my co-trustee of this Trust, in place of my son, Harry Jones”. A neighbor notarized it. She took the entire document to her bank and they changed the name of her co-trustee on her accounts, in accord with the written direction, with no problem at all. This was an eye-opener for me.

Topic Author
Luckywon
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Re: DIY amendment to Trust?

Post by Luckywon » Wed May 15, 2019 12:13 pm

Katietsu wrote:
Thu May 02, 2019 1:58 pm
Of have done a few minor DIY legal matters and have used a lawyer. Unfortunately, I have usually needed to make corrections to the attorney prepared documents which may make me lean more towards DIY than I otherwise would.
I've had the same experience. On a few occasions, information I found online (including here at BH) has provided huge added value that I would have thought the attorney would offer without my own research.
Katietsu wrote:
Thu May 02, 2019 1:58 pm
The one issue that has come up is a change in the law. For instance, one state has changed its requirements for a vaiid POA twice in the last decade or so. Had I just replaced the names and signed with a new date, the POA would not have been valid.
Good to keep in mind. Thanks for your input.
Sandtrap wrote:
Mon May 13, 2019 5:14 pm
I have had a number of amendments/addendums to a trust.
It was suggested by legal counsel that I do a "restatement of trust" to consolidate everything and make sure there are no conflicts, etc. I'm strongly considering doing so as it will give me a chance to update things as well.
This may or may not work for you depending on what your legal counsel advises.
A restatement may indeed be appropriate at some point. Will have to think about that. Thanks Sandtrap.
CRTR wrote:
Mon May 13, 2019 5:28 pm
My father did the same thing (template) and wrote his own amendments. We had no problems with the trust even though it was contested by my half-sister. His changes withstood the assault. That being said, I was VERY nervous going through the process because I shared many of the concerns mentioned above but he got away with it . . . the nicer thing for you to do for your heirs would be to pay a lawyer
Thanks very much for posting about this experience. If you feel comfortable telling more, I'd be interested whether the challenge was based on the fact the amendment was DIY? If the amendment was done by an attorney do you think there would have been no issue?
littlebird wrote:
Mon May 13, 2019 11:18 pm
One of my neighbors had a Revocable Trust where the top sheet was headed: “ I wish to make the following changes”. There were lines below. I helped her write “I want to substitute my grandson Joseph Jones as my co-trustee of this Trust, in place of my son, Harry Jones”. A neighbor notarized it. She took the entire document to her bank and they changed the name of her co-trustee on her accounts, in accord with the written direction, with no problem at all. This was an eye-opener for me.
Very interesting, thanks!

MrsBDG
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Re: DIY amendment to Trust?

Post by MrsBDG » Wed May 15, 2019 8:03 pm

We've DIYed trust amendments numerous times, for several different trusts. Never had a problem, but the issue is that you don't know you will have a problem until you do. I often find the companies don't know as much as we think they do, I can't tell you how many times a person (title company, insurance company, bank) insists that they must have possession of the entire trust. Nope, no you do not; you get the abstract and the sig pages and the amendments, etc. One thing people like about trusts is that the details can remain confidential.

Think about who is going to be seeing and reviewing the amendment, do you see any reason they would refuse it? I personally think they just tick the box. Funny, though, we had one situation where a trust document, prepared by an attorney, was submitted to three different companies, only one company found a legit typo that actually changed the meaning of that paragraph.

Think about where you will use that amendment and think about the risks of some error on your part & decide if you want to take your chances.

bsteiner
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Re: DIY amendment to Trust?

Post by bsteiner » Wed May 15, 2019 9:13 pm

MrsBDG wrote:
Wed May 15, 2019 8:03 pm
... I can't tell you how many times a person (title company, insurance company, bank) insists that they must have possession of the entire trust. ...
If the trustees are the sellers, the title company wants to see the trust to make sure there's nothing in it that would prevent the trustees from selling the property. For example, the trust might say that the trustees may not sell the property without the consent of X.

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Luckywon
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Re: DIY amendment to Trust?

Post by Luckywon » Wed May 15, 2019 10:53 pm

bsteiner wrote:
Wed May 15, 2019 9:13 pm
MrsBDG wrote:
Wed May 15, 2019 8:03 pm
... I can't tell you how many times a person (title company, insurance company, bank) insists that they must have possession of the entire trust. ...
If the trustees are the sellers, the title company wants to see the trust to make sure there's nothing in it that would prevent the trustees from selling the property. For example, the trust might say that the trustees may not sell the property without the consent of X.
bsteiner, have you seen cases where DIY amendments caused problems? Is this a very bad idea? I'm a California resident considering amending my Trust to change the beneficiaries using a previous amendment which changed the beneficiaries as a template.

bsteiner
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Re: DIY amendment to Trust?

Post by bsteiner » Thu May 16, 2019 10:38 am

Luckywon wrote:
Wed May 15, 2019 10:53 pm
...
bsteiner, have you seen cases where DIY amendments caused problems? Is this a very bad idea? I'm a California resident considering amending my Trust to change the beneficiaries using a previous amendment which changed the beneficiaries as a template.
We don't see very many Wills or trusts that testators or grantors prepared themselves.

We sometimes see Wills and trusts prepared by lawyers who aren't trusts and estates lawyers that aren't clear as to who gets what. That often causes problems. Similarly, we sometimes see separation agreements that tax/estates lawyers didn't review, or prenuptial agreements that tax/estates lawyers neither prepared nor reviewed that aren't clear as to who gets what.

More often we see Wills and trusts prepared by lawyers who aren't trusts and estates lawyers that aren't tax-efficient or that don't provide as much asset protection for the beneficiaries as they might have. Sometimes we can fix it post-mortem by disclaimers or by decanting.

Topic Author
Luckywon
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Re: DIY amendment to Trust?

Post by Luckywon » Thu May 16, 2019 9:10 pm

bsteiner wrote:
Thu May 16, 2019 10:38 am
Luckywon wrote:
Wed May 15, 2019 10:53 pm
...
bsteiner, have you seen cases where DIY amendments caused problems? Is this a very bad idea? I'm a California resident considering amending my Trust to change the beneficiaries using a previous amendment which changed the beneficiaries as a template.
We don't see very many Wills or trusts that testators or grantors prepared themselves.

We sometimes see Wills and trusts prepared by lawyers who aren't trusts and estates lawyers that aren't clear as to who gets what. That often causes problems. Similarly, we sometimes see separation agreements that tax/estates lawyers didn't review, or prenuptial agreements that tax/estates lawyers neither prepared nor reviewed that aren't clear as to who gets what.

More often we see Wills and trusts prepared by lawyers who aren't trusts and estates lawyers that aren't tax-efficient or that don't provide as much asset protection for the beneficiaries as they might have. Sometimes we can fix it post-mortem by disclaimers or by decanting.
Thanks bsteiner. My trust and amendments so far were prepared by an attorney. It is another amendment I was thinking of preparing myself. What you say above is very helpful though and thanks so much as always for your wisdom.

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