Can You Set Up a Trust Without an Attorney?

Creating a trust is a crucial aspect of estate planning for many Californians. A trust allows you to avoid a long, expensive probate court proceeding, making it extremely attractive in a state where the average probate process lasts 18 months and costs tens of thousands of dollars. Most people consult an estate planning attorney to create a trust, but others may wonder if they can do it themselves to save on legal fees. Can you set up a trust without an attorney? Here’s an overview.

Understanding Trusts

Before we delve into the question of setting up a trust without an attorney, it’s essential to have a basic understanding of what a trust is. A trust is a legal arrangement that allows a trustee to hold and manage assets on behalf of beneficiaries. 

There are various types of trusts which can be used depending on your goal. The most popular type of trust in California is a revocable living trust. There are also many types of irrevocable trusts which can offer benefits like reducing estate taxes and creditor protection. Typically, an experienced estate planning attorney can advise you on the optimum type of trust for your personal circumstances.

Setting Up a Trust Without an Attorney

While it is possible to set up a trust without an attorney, it’s not recommended due to the complexity involved. Here are just a few of the crucial components involved in creating a trust:

Research and Education 

Before creating a trust, you must start by gaining a solid understanding of trusts, their types, and the legal requirements in your state. You would need to take into consideration numerous books, online resources, and state-specific guidelines to navigate the complexities of trust creation.

Choosing the Right Type of Trust

Next, you’d need to select the most suitable type of trust for your needs. Factors such as asset protection, tax implications, creditor protections, and distribution preferences will influence this decision.

Drafting the Trust Document

You would next need to draft your trust agreement. You should tailor the document to your specific situation, including details such as the appointed successor trustee, beneficiaries, and distribution instructions.

Complying with Legal Requirements

You should ensure your trust complies with local laws and regulations. California has specific formalities that must be followed to validate a trust, and failure to meet these requirements could render the trust invalid. You should avoid any language which could be viewed as ambiguous and throw into question your intentions.

Funding the Trust

After executing the trust, you must be careful to fund the trust by transferring any desired assets into your trust. If you’re like most Californians, the most valuable trust asset you own is probably your home. To transfer real estate into a trust, you must draft a trust transfer deed and properly record it with the county recorder to avoid triggering a probate proceeding after your death. 

With so many complex factors to take into account, it’s easy to see why it’s very difficult to correctly create your own trust without the help of a professional estate planner.

Internet Estate Planning Forms

What about websites that offer do-it-yourself estate planning forms, like NOLO and LegalZoom? While seemingly convenient, these websites take no responsibility for their documents if they fail to work when you pass away.

Compare this with a reputable estate planning law firm, which will take full legal responsibility for the documents they draft. If issues arise during the trust administration process, the attorney will be there to help if needed. They can review notes taken while meeting with you, memos that were written documenting your wishes, and testify as to your intentions at the time you created your estate plan.

Pitfalls of Creating Your Own Trust

Attempting to write your own legal documents can create major problems for your family members after your passing. Here are common issues we often see arise with do-it-yourself estate planning:

• An increased probability that your estate will end up in expensive, emotionally straining, and time-consuming litigation after your passing.
• Failing to take advantage of appropriate tax planning.
• Inappropriately giving gifts to family members, such as minor children, beneficiaries with drug problems, or beneficiaries with special needs who could potentially lose their government benefits.

For all of these reasons, setting up a trust without an attorney is not a viable option for individuals who aren’t experienced in navigating legal intricacies. The potential risks and pitfalls associated with the DIY approach are too great. Consulting an experienced estate planning lawyer remains a wise choice to ensure a legally sound trust that aligns with your wishes.

Law Offices of Daniel A. Hunt

The Law Offices of Daniel A. Hunt is a California law firm specializing in Estate Planning; Trust Administration & Litigation; Probate; and Conservatorships. We've helped over 10,000 clients find peace of mind. We serve clients throughout the greater Sacramento region and the state of California.