​

As you can see, Richard and Cynthia have worked hard in their life and done quite well for themselves.  However, they would not be classified as "mega rich" by most conventional standards.  Nonetheless, their joint estate is worth $775,000 + $500,000 + $645,000 + $60,000 + $20,000 = $2,000,000.  

​

Let's assume that Richard passes away years later and their estate remains at the same value.  Richard's desire has always been to leave his entire estate to Cynthia.  At the time of his death, his estate is worth half of the joint estate, or half of $2,000,000, which is $1,000,000.  In this situation, one of three events will unfold: 

 

Scenario 1: Richard dies without a will.  As such, his estate must be probated and thus Cynthia will be tied up in court for the foreseeable future.  In this scenario, under Oregon law, 1/2 of Richard's estate will go to Cynthia and 1/2 will go to Cheryl.  Mark will receive nothing.  Furthermore, upon Cynthia's death, her family will receive a large tax bill: approximately $100,000.  Not only did Cynthia not receive Richard's entire estate, as he intended, but his family will have to grapple with an unnecessary $100,000 tax bill and approximately $5,000 in probate attorney's fees.  The total cost to his family is $105,000 and a lengthy court process.

​

Scenario 2: Richard dies with a will in which he leaves his entire estate to Cynthia.  In this scenario, Cynthia will be entitled to his entire estate.  However, Cynthia will still be tied up in the courts for the foreseeable future because a will must go through probate. Furthermore, upon Cynthia's death, her family will still have to contend with the $100,000 tax bill mentioned above and the $5,000 in attorney's fees.  The total cost to Richard's family is still $105,000 and a lengthy court process.

​

Scenario 3: Richard sets up a properly executed trust whereby he leaves his entire estate to Cynthia.  Since Richard has set up a trust, his estate will not need to be probated and his family completely avoids the courts.  Within the framework of Oregon trust law, Richard was able to leave his entire estate to Cynthia and she, and her family, will be able to avoid all tax on their inheritance. Furthermore, she does not have to pay any attorney's probate fees.  By setting up a trust, Richard has kept his financial matters private and he has saved Cynthia the grief of probate and taxes. The only cost to Richard is the cost of setting up the trust, which is generally less than the probate attorney's fees.

​

​