Components of an Estate Plan

Our law firm does not take a "one size fits all" approach when it comes to Estate Planning-- we want to yield a plan that works well for you and your family.

 

Our process starts with a one-on-one planning consultation with Ernie, in which he takes the time to get to know you and understand your needs. We want to create a trustworthy, long term relationship rather than simply hand you a stack of documents to sign. our goal is to ensure that you have the knowledge to fund and operate your trust-- now and in the future. We want you to feel confident in the fact that your documents are complete and fully care for your loved ones.

These are the components of an estate plan, however the quality of what is written in these documents is important and can be unique to a family or individual's current situation. 

A Will. 

A will is a legally-binding statement directing who will receive your property at your death. However, a will, standing alone, will not protect your estate from probate. A pour-over-will combined by a trust will ensure that your heirs receive their inheritance without having to go through the laborious probate process. This pour-over-will appoints a legal representative (called an executor or a personal representative) to carry out your wishes. It will also name guardians for minor children or dependents, and set up burial or funeral arrangements. If you do not have a will, the state will determine how your property is distributed.

A Revocable Trust (Living Trust)

At the most basic level, a trust is an agreement whereby a person or persons, as trustee, hold legal title to an asset and manages it for the benefit of someone else, the trust beneficiary or beneficiaries. The most important reason to have a revocable living trust in California is that it shields your estate from probate. If you establish a revocable living trust that terminates when you die, any property in the trust passes immediately to the beneficiaries, ultimately saving them both time and money. A trust is also an important way to avoid conservatorship proceedings if you should become physically or mentally incompetent before death.

A Durable Power of Attorney for Financial Management

A power of attorney allows a person you appoint -- your “attorney-in-fact” -- to act in your place for financial purposes when and if you ever become incapacitated. In that case, the person you choose will be able to step in and take care of your financial affairs. Without a durable power of attorney, no one can represent you unless a court appoints a conservator or guardian. That court process takes time, costs money, and the judge may not choose the person you would prefer. In addition, under a guardianship or conservatorship, your representative may have to seek court permission to take planning steps that he/she could implement immediately under a simple durable power of attorney. 

An Advance Health Care Directive

 

An “advance health care directive” lets your physician, family and friends know your health care preferences, including the types of special treatment you want or don’t want at the end of life, your desire for diagnostic testing, surgical procedures, cardiopulmonary resuscitation and organ donation. By considering your options early, you can ensure the quality of life that is important to you and avoid having your family “guess” your wishes or having to make critical medical care decisions for you under stress or in emotional turmoil. 

A Nomination of Guardian

Deciding who will become legally responsible for raising one’s minor children in the event of the parent’s death is probably the most important component of an estate plan. By law, only the court can appoint who will actually become a guardian. The court is bound by family law provisions that are based upon the best interest of the child. All parents should be thoughtful and nominate a first, second, and third choice of who would, in their opinion, provide the best care, custody, control, and education for their minor children after their death. 

Beneficiary Designations

At the same time you create an estate plan, you should make sure your retirement plan beneficiary designations are up to date. If you don’t name a beneficiary, the distribution of benefits may be controlled by state or federal law or according to your particular retirement plan. Some plans automatically distribute money to a spouse or children. Although others may leave it to the retirement plan holder’s estate, this could have negative tax consequences. The only way to control where the money goes is to name a beneficiary.  

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