Estate Planning

Estate Planning, which most people view as primarily including Trusts and Wills, is very important.  However, proper Estate Planning not only includes Trusts and Wills, but as important are other aspects of Estate Planning such as Health Care Directives and Durable Power of Attorney for Assets. 

 

If you are uncertain about whether you need an Estate Plan, consider the following when deciding why you would need Estate Planning:

 

• Control over your personal decisions during your life in the event you are unable to make decisions;

• Control over health care decisions in the event you are unable to make decisions;

• Control over your assets during life in the event you are unable to make decisions;

• Control who is entitled to assets after death;

• Minimize legal fees;

• Minimize taxes; and

• Preserve assets from devastating costs of nursing home care.

 

It is important to note that the State of California has a legal process in which the law determines how a person’s estate is handled in the event a person does not have a proper estate plan upon death.  Any decisions you would have made are not part of that plan.  We are here to help you ensure that your wishes are followed and that you get to decide what happens to your assets and make important life decisions in case you are unable to make those decisions.

 

 

Trusts are not only for the wealthy but are an important part of important life planning for everyone and can provide peace of mind by ensuring your decisions are honored and that the government doesn’t decide how your assets are divided.  

 

A trust is a legal arrangement intended to ensure a person’s assets eventually go to specific beneficiaries. The person creating the trust puts assets in the name of the trust and authorizes a third party to administer those assets for the trust creator and the beneficiaries.

 

The main purpose of a trust is to transfer assets from one person to another. Trusts can hold different kinds of assets. Investment accounts, houses and cars are examples.

One advantage of a trust is that it usually avoids having your assets (and your heirs) go through probate when you die. Probate is a part of the court system tasked with deciding whether your will is valid (if you have a will) and then distributing your assets. That can take several months, and much of it is public record.

Trusts serve far more varied purposes than many people realize, and they aren’t just for the wealthy.

A trust may be right for you if you need to accomplish any of these goals:

• Avoid probate.

• Transfer your business or real estate seamlessly after death.

• Protect assets from creditors and lawsuits.

• Give assets to a minor child.

• Parcel out an inheritance over time.

• Provide for a special-needs child.

• Leave money to charity.

 

A will is a legal document that sets forth your wishes regarding the distribution of your property and the care of any minor children. If you die without a will, those wishes may not be carried out. Further, your heirs may end up spending additional time, money, and emotional energy to settle your affairs after you're gone.

Your last will and testament is just one part of a comprehensive estate plan. If a person dies without a Will they are said to have died “intestate” and state laws will determine how and to whom the person’s assets will be distributed. 

However, it is important to note:

• A will has no legal authority until after death, therefore it will not help manage a person’s affairs when they are incapacitated, whether by illness or injury.

• A will does not avoid probate. 

• A will can provide a place to nominate the guardians (or back-up parents) of your minor children if necessary.  All parents of minor children should document their election.  This likely avoids protracted litigation and having your children end up with those whom you would not have personally chosen.

 

Wills can vary in their effectiveness, depending on the type, though no document will likely resolve every issue that arises after your death. Here's what you need to know about these vital documents.

• A will is a legal document that spells out your wishes regarding the care of your children, as well as the distribution of your assets after your death.

• Failure to prepare a will typically leaves decisions about your estate in the hands of judges or state officials and may also cause family strife.

• You can prepare a valid will yourself, but you should have the document witnessed to decrease the likelihood of successful challenges later.

• To be completely sure everything is in order, consider having your will prepared by a trusts and estates attorney.

 

 

An advance health care directive is a legal document that outlines your health care preferences in the event that you become incapacitated or unable to make medical decisions on your own behalf.  An AHCD is a way to make your healthcare wishes known if you are unable to speak for yourself or prefer someone else to speak for you. An AHCD can serve one or both of these functions:

• Power of Attorney for Healthcare (to appoint an agent)

• Instructions for Health Care (to indicate your wishes)

In this document you appointment someone you trust (your “agent”) to make your medical decisions and provide care if you become incapacitated. The advance health care directive is one of the crucial parts of any estate plan.

There is a common misconception that health care directives are only for older people, but in fact, a person of any age can benefit from having an advance health care directive in place. Even if you’re young and healthy, there’s always a possibility you could suffer an accident or medical issue and be unable to communicate your health care wishes to your doctors and loved ones. This document enables you to clearly state those wishes and protect yourself in a worst-case scenario.

If you are not able to speak for yourself, the doctor and healthcare team will turn to one or more family members or friends. The most appropriate decision maker is the one with a close, caring relationship with you, is aware of your values and beliefs and is willing and able to make the needed decisions.

 

If you become ill or injured and you can't take care of your own finances, someone else must step in to help. With a financial power of attorney, you name a trusted person to pay bills, make bank deposits, watch over investments, collect insurance or government benefits, and handle other money matters on your behalf.  It authorizes a person to stand in your shoes to handle your finances.

 

A power of attorney for finances is a document that appoints a person — or sometimes an institution such as a bank or trust company — to handle someone’s financial affairs. A power of attorney for finances can also be used to make life easier for your parents, for example, or loved ones even though they still make decisions and handle some financial matters themselves. Or it can be used to handle all their financial matters when they’re incapable of doing so themselves.