ESTATE PLANNING

An estate plan specifies how you want your decisions made during incapacity and how you want your assets distributed, making it easier for your loved ones to handle your affairs during a time of hardship or grief.  Working one-on-one with an experienced attorney can make the process much less daunting.  Allow me to make estate planning easy for you. 

DO I NEED ESTATE PLANNING?

A proper estate plan can help you, but it will mostly help your loved ones.  Additionally, an estate plan can:

• Help avoid the costs, publicity, and delays of probate.

• Identify someone you trust to make decisions for you if you become incapacitated.

• Help minimize estate taxes and other transfer taxes.

• Manage assets for the estate plan owner and for beneficiaries.

• Specify who will care for your minor children if you’re unable to do so. 

AVOIDING PROBATE is by far the most common reason why people seek out the advice of an estate planning attorney. While many have never even dealt with probate, they still know one thing - they want to avoid it at all costs.

Probate is the legal process whereby the Superior Court oversees the administration of a decedent’s estate.  Probate is costly, time-consuming and public.

• Cost: approximately 3% to 6% of the gross value of the assets being probated.

• Time: 6 to 9+ months, longer if there is disagreement.

• Public: Probate takes place in open court, exposing the details of the decedent’s estate to public scrutiny.

MANAGEMENT is another important reason to create an estate plan.  Management is divided into two areas: management for the estate plan owner and management for the beneficiaries.

• Estate Plan Owner: An estate plan will manage an elderly or incapacitated estate plan owner’s assets, income, business decisions, and maintain that person’s accustomed standard of living. (avoiding conservatorship)

• Beneficiaries: There are generally three main reasons why people put together an estate plan in order to protect their beneficiaries: (a) Protecting minor beneficiaries, (b) Protecting disabled beneficiaries and their benefits, and/or (c) Protecting adult beneficiaries from bad decisions, outside influences, creditor problems and divorcing spouses.  Also, Guardians for minor children are nominated in an estate plan.  Without a Guardian nomination, the Court will choose a guardian, and that Guardian may or may not be the person you would have chosen.

WHAT DO I NEED?

Most estate plans include the following tools to ensure these goals are met:

MAIN DOCUMENTS

• Revocable Living Trust
• Pour-Over Will
• Durable Power of Attorney
• Advance Medical Directive

SUPPORTING TOOLS

• Guardian Nomination
• HIPAA Authorization & Waiver
• Final Disposition Instructions
• Personal Property Distribution Instructions

• Certification of Trust
• Transfer Letter for Financial Accounts

• Transfer Documents for Real Estate
• Assessor’s Statement (to avoid tax reassessment)
• Free Questions and Inquiries

ESTATE PLAN MAIN DOCUMENTS

Revocable Living Trust. The Trust is the main document in most estate plans.  It is used to manage and distribute assets absent a conservatorship or a probate.  A trust is an entity in the eyes of the law. Similar to a person or a corporation, the trust can own and manage assets.  The Trust owner (Trustor) determines how the Trust assets are managed, and also when and to whom the assets are eventually distributed by the manager of the trust (Trustee). 

Wills.  One of two different types of wills is commonly used in an estate plan.  Generally, Wills are probated if the assets include California real property and/or if the value of the probate assets exceeds $150,000.

Pour-over Will.  This Will accompanies a Trust, it does not act independently of a Trust.  The Pour-over Will acts as a “safety-net” by leaving all non-Trust assets to the Trust after death should they have been inadvertently left out of the Trust while the Trust owner was alive. 

Last Will and Testament.  This Will nominates and Executor and then directs your Executor to dispose of probate assets in accordance with your written wishes. It is an instrument that can name guardians for your minor children.

Durable Power of Attorney. This document is a formal appointment of an agent to conduct your financial or business affairs on your behalf if you cannot do so yourself. “Durable” means that the Power of Attorney will remain in effect even if you become incapacitated.

Advance Medical Directive. In this document you formally appoint a person to make personal care and health-care decisions for you when you lack the capacity to make them for yourself. The Medical Directive should also include the owner’s instructions on “end-of-life decisions.”

THE ESTATE PLANNING PROCESS

You will be asked to make these decisions in the estate planning process:

• Who should be responsible for managing and distributing your assets?

• Who should manage your financial affairs if you’re incapacitated?

• Who should inherit your assets, when and in what proportions?

• Who should care for your minor children?

• How much is needed for your children’s care and education?

Estate plans usually take three meetings.  1. The initial consultation, 2. Draft review, explanation, questions and answer and mark-up for final version, and 3. Signing, witnessing and notarizing.  More meetings might be needed, there is no additional charge.

RANDALL HEILER, Attorney at Law

• California State Bar Member since 1991.

• Practice limited to estate planning and probate.

• Free Consultation.

• Free House Calls.