What will happen to your children if you become incapacitated or die today?  Who will take care of them? How will they be provided for? These aren’t pleasant thoughts to contemplate, but they are important to consider.  Should something happen to you, the last thing you want is your children’s future to be decided by the courts.  

Estate Planning Tips for Parents with Minor Children

California estate planning attorneys are committed to helping families protect their children through proactive, comprehensive estate planning. While each family’s unique needs will guide their estate plan, these five estate planning tips for parents of minor children are a good starting point:

1. Decide on a Guardian

You must decide who you want to raise your children if you aren’t around to do so.  Naming a guardian for your children will safeguard their future well-being and ensure that they will remain with someone of your choosing. If you do not name a guardian, the courts may need to appoint one for them or place them in foster care. 

When choosing someone to act as your child’s guardian, ask yourself these questions:

• Do they live close by, or will they relocate to your children’s community?
• Do they have stable personal relationships?
• Are they financially responsible and secure?
• Will they provide the lifestyle and religious upbringing you would prefer?
• Are they willing to assume the responsibility of raising your children?

2. Update Beneficiaries on Retirement Accounts

Review your retirement and investment accounts and update your beneficiaries. Ask your estate planning attorney about naming beneficiaries and how to ensure that benefits are distributed according to your wishes. 

3. Purchase Life Insurance

Life insurance offers peace of mind that your children will have the funds needed to live comfortably and pursue their goals in the event of your death. 

An estate planning attorney may advise you regarding policy types and amounts suitable to your family’s needs. Factor your estate debts and your children’s short-term and long-term needs when purchasing life insurance policies, including:

• Special medical needs
• Care-taking support
• Standard of living
• Sports and recreation
• College expenses

4. Advance Health Care Directives

Many people think of estate planning exclusively in terms of finances. However, it’s equally important to exeu an advance health care directive. 

A medical directive a will define your preferences regarding medical treatment and decision-makers. A financial power of attorney designates who can access and manage your finances when you can’t. 

These documents are essential to any comprehensive estate plan, establishing clarity and direction for your loved ones in the event you are incapacitated or deceased.

5. Establish a Will and Trust

Decisions regarding your children’s care and the management of your estate need to be recorded in a legal format. A skilled estate planning attorney will prepare all necessary documents and ensure they are legally sound if challenged. 

Trusts are particularly valuable as they allow for specific instructions regarding the trustee’s estate. For instance, many parents instruct that their estate be disbursed incrementally, as a child ages and matures, and for specific purposes, such as funding college or entrepreneurial pursuits. 

Trusts also protect against costly probate and unnecessary court intervention, saving thousands of dollars upon estate distribution.

Protect your Family with the Help of a California Estate Planning Attorney 

Families with young children should be proactive in their approach to the future.  Anything could happen, which might tragically leave minor children at risk of being orphaned. Don’t risk their future to chance.  

Contact our office today and plan ahead with the help of an experienced California estate planning attorney. 

Many children with special needs rely on public funding for their support, like Medicaid for health insurance and Supplemental Security Income (SSI) for monthly income. If your estate plan is not set up correctly, your child could lose eligibility for these programs when he or she needs them the most.  Whether your child with special needs is a minor or an adult, you will need to address unique issues when making your estate plan. 

A California estate planning attorney can help you avoid pitfalls when creating your estate plan. Parents with special needs children typically have these three goals when planning for the future of their children:

• To avoid outcomes that could jeopardize your child’s eligibility for government benefits programs. For example, the assets or income you provide for your child need to be in a category that the government does not consider as “countable” assets for purposes of qualifying for Medicaid, SSI, and other benefits.
• To make assets available to help your child if the public funding programs get canceled or reduced.
• To plan for the management of your child’s money. You need to select someone who will manage your child’s financial matters if you become incapacitated and after you pass away. Choosing the right person to assist with your child’s finances may be one of the most critical decisions you will have to make for your child’s future well-being. 

Special Needs Trusts

A thoughtfully-drafted Special Needs Trust can help provide disabled beneficiaries with the support they require, without causing them to forfeit their public benefits during their lifetime.  After the beneficiary of a Special Needs Trust passes away, the government may  have the right to claim the assets that remain in the trust as reimbursement for benefits and services received during his or her lifetime. But any funds remaining after that reimbursement can go to the other beneficiaries you name in the trust.Special Needs Trusts can be tricky to set up. If not done correctly, your child will not receive the financial security you wanted him or her to have. Contact us today for a consultation. Our California estate planning attorneys can draft the trust documents and guide you through the process of transferring assets to the trust.

If a California resident dies without a valid will or trust, then California law will control who gets their assets. Without an effective estate plan, your assets may pass to heirs you may not prefer, or even to heirs you’ve never met. An estate plan is the only way to ensure that the people you love will receive the things you want them to have. California intestate succession lawyers can help you execute the documents to protect your loved ones. 

When a person dies without a will or trust, all of their assets may pass through a process called intestate succession. The state will apply a one-size-fits-all formula, regardless of how well you got along with any of the individuals named as your heirs under the law. People you cared about dearly might get cut out entirely. Below is an overview of intestate succession and why you need to care about whether your estate passes to your loved ones through intestacy.

The State of California and Intestacy 

If you die without a will or trust, then your assets may benefit the state more than they would if you did not die intestate. Most trusts, for example, do not have to go through probate court, and so trust beneficiaries can often avoid probate fees and other court costs.

In some cases, the state could even receive 100% of your assets, if you die without a will or trust. If you do not have any natural heirs closely related to you, then everything you own could “escheat” to the state after your death – meaning that the state simply takes over the assets. 

What “Surviving” Means in California for Purposes of Intestacy 

You might think that someone survives you if they are still alive when you die. Unfortunately, that situation is not always the case. The intestacy statutes in California say that someone must live at least 120 hours (five days) longer than you to inherit from you. 

Let’s say that you and a close relative were in a car accident, and you did not have a will or trust. If you died at the scene of the crash and your loved one died three or four days later, the law says that your relative did not survive you. None of your assets will go to that person’s estate or be distributed to their heirs. 

The Pecking Order of Natural Heirs in Intestate Succession

California’s intestacy rules are complex. In general, the assets of a married person who dies without a will or trust will get distributed as follows:

• The surviving spouse will get the decedent’s 1/2 share of the couple’s community property.
• The surviving spouse will also receive all of the decedent’s separate property if the decedent did not have any surviving children, parents, siblings, or children of a deceased sibling. 
• Depending on the facts of the situation, the surviving spouse could receive only 1/2 or 1/3 of the decedent’s separate property. 

These are just a few of the rules California applies to intestate estates. Contact a California elder law attorney to learn more. Our California estate planning lawyers could walk you through the intestacy laws and answer your questions about who would inherit from you if you die without a will or trust.  But more importantly, our attorneys can help you avoid intestacy altogether, to ensure that your wishes are faithfully carried out upon your death. 

As soon as the dust settles after divorce, women need to take care of other paperwork to avoid problems now and down the road. A California estate planning attorney can help you get ready for the next act of your life. Here are a few examples of ways to protect yourself and your loved ones.

Time to Update

Update your estate planning documents, particularly your will and living trust. You do not want to die intestate. Also, you do not want your former spouse to claim the right to serve as the executor of your will or the trustee of your living trust, or to receive assets from your old will or trust.

Have your estate planning lawyer read your divorce documents to see if your estate will have any obligations to your former spouse when you die, like a life insurance policy that will pay out to your ex-spouse. You will need to make sure that you buy and maintain the life insurance policy, update the beneficiary designation on the policy, and mention the life insurance policy in your estate plan, to avoid confusion or disputes down the road. 

Speaking of life insurance, make sure that you review the beneficiaries of all of your life insurance policies and retirement accounts. Update these designations to reflect the people you now want to receive these funds in the event of your death.  If you mistakenly leave your ex-spouse on the account as beneficiary, or fail to name a new beneficiary, your desired beneficiaries may be unable to receive your assets as you intend them to.

Try to think of all the possible payouts to others when you die, and make sure you change the named beneficiaries as necessary. For example, you might have an accidental death benefit through your automobile insurance or credit cards. You will want to update these beneficiary designations so that your former spouse does not receive these funds by default.

Update your durable power of attorney for financial matters and your power of attorney for medical decisions. If you are severely injured or become ill and cannot make medical or financial decisions for yourself, you do not want your former spouse handling those matters while you are incapacitated. 

Protect Your Children

You might consider setting up a trust for your minor children, naming someone else (not your former spouse) as the trustee until the children turn 18 or older. Also, if your children are under the age of 18, consider the issue of guardianship. 

Your former spouse is likely to get custody of the children if you do not survive until the children reach the majority age.  But you can still nominate someone else as a back-up guardian, just in case, and state the reason for those wishes in your will or trust.  For example, a parent with significant issues like addiction or economic problems might want an excuse to avoid the responsibility of parenting. The former spouse can say that letting the third party raise the children was done to honor your wishes.

Wrapping Up Details

If you receive a life estate in the family residence as part of the marital settlement, and the property reverts to your former spouse when you pass on, you need to make arrangements for what will happen to your personal property in the house at that time. You will also need to make sure that your will or living trust does not grant the house to someone else, if this gift contradicts the terms of the marital settlement. 

You might want to inform your close loved ones about the general terms of the divorce, to avoid surprises in the event of your death. Contact us today for a consultation. It is often worthwhile to meet with a California estate planning attorney to go over your divorce documents and create a strategy that protects you and your loved ones going forward.

Estate planning is essential for all parents. However, single fathers face additional challenges and issues when preparing their estate, especially if their child’s other parent has passed away or cannot care for the child. Our California estate planning attorneys can help you address common estate planning issues for single parents. Creating an estate plan gives you the peace of mind of knowing that your child will be cared for if you become incapacitated or die suddenly.

Four Estate Planning Tips for Single Fathers

1.  Prepare a Will Immediately

A will allows you to choose a guardian for your child. The choice of a guardian is one of the most important aspects of estate planning as a single parent because the guardian will be responsible for caring for your child if you die or are incapacited. If you do not have a will and your child’s other parent cannot care for your child, the state decides who your child lives with after your death or upon your incapacity.

2.  Create a Trust for Your Child’s Inheritance

You should also consider executing a revocable living trust. A trust can provide that your child will receive his or her full inheritance only when reaching adulthood.  Until that time, a trustee will maintain the assets for the child’s benefit, and make distributions for the child’s health, education, maintenance and support.  A sophisticated trust may also provide that the child may receive shares of the inheritance outright in stages, such as in one-third shares when the child reaches the age of 25, 30, and 35.  There are a variety of trust agreements available. The type of trust you choose depends on your unique financial situation and your goals for protecting and managing your child’s inheritance.

3.  Include Incapacity Planning in Your Estate Plan

A comprehensive estate plan includes documents that protect your right to make health care decisions and financial decisions for yourself, even though you may become incapacitated. Your estate plan should include a financial power of attorney that gives someone you trust the power to make financial decisions for you if you are unable to do so.

Also, you should consider including medical directives that appoint an agent to make healthcare decisions for you if you are in an accident or become ill. Health care directives may also include instructions for end-of-life care or life-sustaining treatments, such as feeding tubes or respirators.

4.  Check Beneficiary Designations 

Some property passes directly to a beneficiary outside of your probate estate. In other words, the property is transferred upon your death to a specific person. Examples of assets that pass directly to a beneficiary upon your death may include retirement accounts, POD (pay-on-death) accounts, TOD (transfer-on-death) accounts, life insurance policies, annuities, and some investments. 

You will want to make sure that your beneficiary designations coordinate with your estate plan so that your child receives the property, if possible, without court interference. 

Contact Our California Estate Planning Attorneys for More Information 

It is hard to think about your child growing up without you. Contact us today for a consultation. Our California estate planning attorneys can help you protect your child’s inheritance and welfare in the event the unthinkable happens.

Congratulations – You took the first step and set up an estate plan. You’ve made the right decision to protect your family in case something happens to you.  But before you stick the papers in a drawer, you need to think about when you should plan on taking another look at the documents. 

Even the best estate plans can become less effective when certain things happen in life. You should talk with a California estate planning attorney when any of these 10 life events occur:

10 Events That Should Trigger an Estate Plan Review

1. You get married. 

Once you get married, or enter into a domestic partnership, your spouse may have rights of inheritance. Getting married can therefore make your previous will or trust invalid. Even if you have a prenuptial agreement that waives your inheritance rights from each other, you should update your will or trust to make sure it clearly states your intentions. If you do not make a new will or trust, your current documents may become unclear or ineffective.   Your executor or trustee may be forced to go to court unnecessarily, and the judge may rule that the documents apply differently from what you intended, or that they don’t apply at all. In short, family law and probate law principles may be inconsistent. But a well-drafted, updated estate plan can often resolve any inconsistencies.

2. You get divorced. 

You might assume that your work is done when your divorce case finally makes its way through court.  But you will need to take care of many more details after the smoke clears. One of these items is making a new estate plan. A divorce can invalidate your will or trust, and you do not want to die intestate or with a plan that doesn’t accurately carry out your wishes.  Again, a well-drafted, updated estate plan will reflect and acknowledge any changes that arise due to your divorce or separation from your spouse.

3. A child or grandchild is born or adopted.

One of the most common reasons that your surviving heirs may contest your will or trust is when your instruments do not mention all of the children or grandchildren. Your documents might include the term “afterborns,” to refer to children born or adopted after you signed your will or trust, or “issue,” to refer to any of your descendants.  But to help prevent problems with your estate or trust administration after you’re gone, it is best to update your papers to reflect your current family members. You should also review your documents if you or one of your beneficiaries adopt a stepchild.

4. Your child marries. 

Whether you love or hate the person your child marries, you might want to have a discussion with your estate planning lawyer when your child marries to ensure your estate plan remains effective as you intend. Depending on the circumstances, you might consult with your estate planning attorney to name your new in-law in your papers — either to make sure they receive a benefit, or, to the contrary,  or get advice on how to protect your child’s inheritance from a potential gold-digger.

5. Your child divorces. 

Many things change when your child divorces. Your relationship with your child’s former spouse is seldom the same as before. Your estate planning lawyer can advise you on any updates that might be appropriate in your situation.

6. Your spouse dies. 

When your spouse dies, you have a mountain of decisions to make and steps to take while dealing with your grief and loss. You should immediately seek out a estate and trust administration attorney to ensure you take all actions necessary or advisable to administer your spouse’s estate or trust.  When the initial crisis is behind you, it can be a good idea to review and update your will or trust. Most people leave a significant portion of their estate to their spouse. You will need to think about who will get the assets that your spouse would have received.

7. Your child, son or daughter-in-law, or grandchild dies. 

You likely mentioned your child, your child’s spouse, and your grandchildren in your will or trust. If any of these people predecease you, it is appropriate to update your documents so that there will be clarity about the distribution of your assets.

8. You get a windfall. 

When you initially set up your estate plan, you of course considered your financial condition at that time. If you suddenly receive a windfall, like a significant inheritance, a winning lottery ticket, or proceeds from a personal injury lawsuit, you might want to reconsider your future beneficiaries. You may be able to help charities, for example, that you could not have given money to before.

9. You have a drastic change in your financial condition. 

While a windfall is a happy reason to update your will or trust, you should also take another look at your will or trust if you experience an economic downturn. You might not be able to make some of the bequests you included in your estate plan, and you may need to rethink some of those future gifts.

10. The passage of time. 

Sometimes your estate plan could use a few tweaks because of an accumulation of many small events instead of one substantial change of circumstance. State and federal laws change every year, potentially affecting issues like estate taxes and other taxes. Most legal and financial advisors recommend that you talk with an estate planning lawyer once every four or five years to keep your papers current.

Contact us today for a consultation. Our attorneys, including Certified Specialists in Estate Planning and Probate, can guide you through the estate planning process and provide suggestions for how to accomplish your goals and desires for your loved ones.

A revocable living trust is an essential estate planning tool. You can accomplish many things with a trust that you cannot do with a will. However, you can lose many of the advantages of a living trust if you do not complete the necessary steps. A California estate planning attorney can draft the trust document and give you advice on the rules that govern these instruments. 

Here are three things you should know about revocable living trusts.

What Do These Words Mean? Terminology Used in Trust Documents

Trust documents use terminology that you do not hear in everyday conversation. It can be a challenge to understand who the parties are without an explanation. Here are some of the common legal words used in trusts:

• Settlor. The settlor (sometimes called a grantor or trustor) is the person who sets up and funds the trust. If you set up a living trust to distribute your assets, you are the settlor.
• Trustee. The trustee is the person who manages the assets of the trust. Often, the settlor is the initial trustee during his or her lifetime. A successor trustee steps in when the settlor dies or becomes incapacitated, or sometimes if the settlor does not wish to serve as an initial trustee at all.   The settlor may name another person to serve as initial or successor trustee, such as a friend or relative, or a professional, like an accountant, financial planner, lawyer, or private professional fiduciary. For large trusts, the settlor may name a professional entity, such as the trust department of a bank, to serve as the initial trustee or the successor trustee.
• Beneficiary. The person who receives the benefit of the trust assets is the beneficiary. For example, while you’re living, you may be the beneficiary of your living trust.  If your trust will one day distribute your assets to your child, your child is a successor beneficiary of your trust.

When Can You Change Your Revocable Living Trust, and When Can it Not Be Changed?

You can change the terms of your revocable living trust or revoke it entirely at any time before you die unless you become incapacitated. A well-drafted trust should specify when you are incapable of managing or changing your trust, such as when two physicians sign letters affirming that you lack the capacity to manage your financial affairs. You are generally incapable of serving as trustee or of changing your trust if you cannot make decisions for yourself or communicate your decisions to others. 

Incapacity is often permanent, but it can also be temporary.  For example, you might suffer from a serious physical injury or illness, or from mental illness or substance abuse issues, that cause you to be temporarily unable to handle your affairs. if you regain the ability to make decisions for yourself and communicate them to others then you may have legal capacity once again.  A well-drafted trust can ensure that your affairs are attended to for as long as you remain incapacitated.

What Are Some Reasons Why People Set Up Revocable Living Trusts?

A revocable living trust provides you with many more options for distribution than a will. With a will, the assets typically get distributed within a year or two of your death, and the estate gets fully distributed and closed at that time. With a trust, you have more flexibility, and you can spread out the distribution of assets over many years.  For example, instead of receiving an inheritance all at once, your child may receive a share of the assets when he or she turns 25, 30, and 35. 

You can provide for other unique circumstances with a trust as well.  For example, if you have a relative with special needs, or a beneficiary who does not handle money well, or a beneficiary who is planning to qualify for Medicaid for nursing home expenses, the trustee can retain discretion to limit the distributions where appropriate. Some trusts can also help you reduce the taxes on your income and assets. 

Finally, unlike a will, a trust can often be administered without the need to go through the probate court. As a result, a trust can provide more privacy. A trust may also allow the trustee to distribute assets more quickly to beneficiaries and with fewer administrative costs than a will that goes through the probate process.

These are only a few examples of the many advantages of living trusts. Talk with our California estate planning attorneys today. Our lawyers can explain additional aspects of these important legal documents and work with you to draft a living trust that meets your needs and goals.