If you have questions about wills, trusts, and other estate planning documents, then you are in the right place. Below are answers to commonly asked questions about the estate planning process.
An estate plan allows you to put someone you trust in charge to make sure your assets are preserved for the benefit of your family and all your outstanding obligations are met upon the time of your death. Having a trust or will in place allows you to specify exactly how you want your assets to be distributed. This can be especially important for young families. For example, creating an estate plan with a Children’s Trust allows parents to ensure their children have some financial stability and can create incentivizing provisions to continue to guide their children even after they’re gone (i.e. early distribution from the trust if the child graduates from a four year college/completes a certain amount of community service/buys their own house).
Estate planning is also incredibly beneficial for blended families as it can be hard to navigate the complexities of these different relationships and the death of a family member can create even more complicated financial and emotional issues. Having a comprehensive estate plan with experienced attorneys allows you to have more control over how your end-of-life services are carried out, who will be taking the lead of your estate to ensure your wishes are followed, and it will alleviates stress on family members while also avoiding pitfalls that could lead to future in-fighting and litigation (which simply wastes estate assets).
A comprehensive estate plan will include documents naming your trusted agents and giving them direction about how you want them to act on your behalf when you are unable. This includes end of life services, such as whether you want to be buried or cremated.
Estate planning is an opportunity to provide for your friends and family and ensure that your wishes are carried out. The sky’s the limit with estate planning…literally…as Gene Roddenberry, the creator of Star Trek, had his ashes rocketed into space.
There are three basic reasons to create and fund a trust in California.
First, it will help keep your estate from being probated in court (saving time and money).
Second, if you have children or wish to leave your estate to other young family members a Trust allows you to create a plan so the money is not just handed to them when they turn 18. You can plan for funding their education and delay the distribution of their inheritance until they’ve reached an age where they are more likely to spend the money wisely.
Finally, if a trust is administered properly your estate can achieve some significant tax savings – leaving more for your heirs and less for the IRS.
We draft Power of Attorney documents for finances. This document states who you want to be in charge of your finances if you are incapacitated and the scope of authority the person has over your finances.
A guardianship nomination lists who you want to have physical and legal custody of your children if you pass away while they are minors and any additional wishes or requirements you have for your child’s guardian.
Your estate will be administered in a formal court proceeding called “probate”. Probate proceedings are entirely public, needlessly expensive, complicated, and time consuming – it generally takes about a year to complete.
The legal term for dying without an Estate Plan in place is called “intestacy” and if you do that, your next of kin will inherit whatever you leave behind. The rules that govern how your assets are distributed may or may not be in line with your preferences.
For instance, if you leave behind a spouse or registered domestic partner and a child, some of your estate may go directly to your child – probably not what most people have in mind while their spouse or domestic partner is still living. If you have no spouse or domestic partner and no children, your next of kin are your parents, and after them your siblings.
If you live with someone to whom you are not married or registered, that person is not legally entitled to receive any of your estate automatically and must file a lawsuit to enforce any claims they may have. If you create an Estate Plan you get to designate who receives your assets and in the event of a dispute, the law supports your right to make this decision.
A Will and Trust are similar because both allow you to state where your assets should go upon your death. However, there are also many differences. For example, if you have assets that exceed $166,250 in value or real property that exceeds exceeds $55,425, you may need a trust to avoid a court supervised probate proceeding. Probate almost always takes longer and costs more than administering a well drafted Trust.
There are many additional reasons why a Trust may be more beneficial than a Will. Trusts offer greater control over when and how your assets are distributed, they come in multiple forms and types which gives you flexibility for your planning.
When you have a Trust, you will also have a "Pour-Over Will" to ensure that all of your assets are managed under the terms of your Trust. The Pour-Over Will acts as a catch-all and essentially says, any assets I forgot to put into my Trust, I would like put into my Trust upon my death.
There may be situations where the simplicity of a Will is appropriate and a Trust is not needed but you will need to speak to an attorney to determine what’s best for you.
The Advance Health Care Directive is a document that states who you want to be in charge of your healthcare decision if you are incapacitated and how you would like to be treated.
It’s easy to get started with creating your Estate Plan. Simply contact our office for a no cost, no obligation consultation to discuss your specific circumstances with one of our attorneys. During the appointment we will answer any questions you have, go over your options, and help you identify the right Estate Plan for you.
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