Estate planning helps anyone with assets to prepare for the future. It safeguards your assets by ensuring you know where they will be distributed and safeguards your loved ones by providing them with financial security. Estate plans can also safeguard your personal interests and health when created with a California estate planning lawyer to ensure they meet legal requirements.
By understanding the basic requirements of an estate plan, you can more effectively begin gathering information and determine your wishes for your estate and your future. It can be useful to work with an estate planning attorney, as they can help you decide which documents are helpful for your needs and how to make your wishes straightforward and enforceable.
What Is the Basic Estate Planning System in California?
A comprehensive estate plan will be tailored to the unique needs of each individual, but there are certain documents that are commonly found in most estate plans. These include:
A last will and testament is the most basic estate planning document, which lists your last wishes for assets distribution and names an executor to handle your estate. Your executor will be responsible for inventorying the estate, paying creditors, and distributing assets to their named beneficiaries. A will can also name a guardian for any minor children you have. Wills may be included in basic or comprehensive estate plans.
A comprehensive estate plan may have one or multiple trusts. Trusts may be irrevocable or revocable, but revocable trusts are far more common and are flexible estate planning tools. When you place your estate into one or more trusts, you keep the estate from entering probate court after your death.Instead, the assets pass to the ownership of the trustee you named. The trustee is responsible for the care and maintenance of the trust and distributing it to the beneficiaries according to your wishes.Trusts are also capable of providing specific requirements for the transfer of assets. You may only want a minor beneficiary to obtain certain assets when they have turned 18 or graduated high school. A trust can outline these specifications.
- Financial and Durable Powers of Attorney
Financial and durable powers of attorney are documents that name a person to handle your financial or legal matters. This allows the person to pay bills, collect mail, and make important decisions on your behalf. These powers are granted if you become incapacitated, incapable, and unable to make financial or legal decisions yourself. This may happen as you near the end of your life, or an accident may cause it to happen at any time in your life.Although few people like to think about such a situation, setting powers of attorney ensures that you know you will be taken care of. Your family members will have to petition the court for the legal authority without these documents.
- Advance Healthcare Directives
Your advance healthcare directives typically include a living will and a medical power of attorney. A living will presents your wishes for medical care if you are incapable of making decisions about your care. It may list the facility you want to receive care, what procedures you will and will not consent to, and how you want your end-of-life care to be managed.The person you name as medical power of attorney has the authority to make medical decisions on your behalf. If you have a living will, the medical power of attorney will follow the guidelines you set.
- HIPAA Authorization
The Health Insurance Portability and Accountability Act (HIPAA) authorization provides specific individuals with access to your healthcare information and medical history.
Q: What Are the 7 Steps in the Estate Planning Process?
A: Important steps in the estate planning process include:
- Inventory your real and personal property, as well as debts and liabilities.
- Determine your family’s needs after your death, including financial requirements and unique needs.
- Determine your beneficiaries and review the beneficiaries on your accounts.
- Use essential estate planning documents to decide your directives and divide your estate.
- Understand your state’s taxes, the state taxes where you own property, and the implications for your estate plan.
- Work with an estate planning attorney to make your estate plan more effective and enforceable.
- Prepare to update and review your plan regularly to reflect changes in life and your needs.
Q: What Is the Average Cost for Estate Planning in California?
A: The cost of creating an estate plan in California with an attorney can range anywhere from $300 to $1,000, or as much as $5,000 or greater for a complex and comprehensive estate plan. An attorney may charge a flat fee or an hourly fee, depending on the complexity of your estate plan and how much time is expected to draft and review the estate plan.
The more documents, assets, or beneficiaries in an estate plan, the more expensive it is likely to be. An attorney’s fees also depend on their experience and location.
Q: What Is Estate Planning in California?
A: Basic documents in an estate plan in California determine where the assets in your estate are transferred after your death. An estate plan helps you determine your plans for the future and allows you to name an executor for your estate and who you want to benefit from your assets.
You can also keep the majority of your estate out of probate court by using trusts, saving your family time and money. Documents in an estate plan can also provide you with legal protections if you become incapacitated.
Q: Is a Trust Better than a Will in California?
A: Wills and trusts in California complete some similar things in an estate plan, including naming beneficiaries or heirs to assets in your estate. However, a trust can do several things a will can’t, including keeping the assets out of probate court.
By placing assets into a living trust, you maintain control over them in your lifetime, but they are not under the state’s power when you die. Instead, they pass to the trustee, which means your family members can more quickly receive the benefits. Trusts can also have terms that must be met before a beneficiary can receive assets, such as reaching a certain age or not spending the assets on certain items.
Contact Robert G. Petrovich, Attorney at Law
When you begin crafting an estate plan, you need to work with an attorney who knows how to provide insightful information and legal guidance. Robert G. Petrovich, Attorney at Law, is dedicated to helping you understand the intricacies of estate planning and enabling you to make informed decisions about your future. Contact us for more information.