Estate Planning FAQ
At Bay Legal, PC, we believe informed clients make the best decisions about their estate plans. That’s why we want to break down complex terms and clarify confusing principles so that you make the right choices for your estate, too. Contact our office either online or at 650-374-7900 for a Consultation to get specific legal advice for your estate plan. In the meantime, here are responses to some of the most frequently asked questions we get when new clients come to our office in California.
What is Estate Planning?
Estate planning is a process allowing you to arrange how you want your assets to be managed and distributed upon your death. Sometimes, if you have limited assets, limited beneficiaries, and limited instructions on how to distribute your assets to the beneficiaries, planning is pretty straightforward. On the other hand, the more assets, the more beneficiaries, and the more instructions may require an estate plan that is more complex and varied. Additionally, it’s essential to stay informed about the various legal requirements and tax implications that can affect your estate. Failing to properly execute your estate plan can lead to complications and disputes among beneficiaries. To ensure a smoother process, it’s crucial to be aware of common estate planning errors to avoid, such as not updating your documents regularly or neglecting to account for all assets.
Generally, there are two components of estate planning with one involving the legal aspects of it and the other involving the non-legal aspects of the plan. Your estate planning attorney can help with both. Legally speaking, your lawyer will review your personal and financial situation and create documents that address the latter. Non-legally speaking, your lawyer will develop an investment strategy for retirement purposes.
What goes into an estate plan in California?
An estate plan will include the documents that accommodate your specific needs. It may involve some or all of the following:
- Last will and testament
- Living trust
- Irrevocable trusts (e.g., life insurance trusts, gift trusts, special needs trust, charitable trust)
- Conservatorship
- Guardianships
- Asset protection from divorce, creditors, others
- Health care directives, including medical powers of attorney, living wills, health care proxy, do not resuscitate (DNR) or do not intubate (DNI) orders
- Succession plan for business
- Charitable planning
What is estate planning?
Estate planning is a process allowing you to arrange how you want your assets to be managed and distributed upon your death. Sometimes, if you have limited assets, limited beneficiaries, and limited instructions on how to distribute your assets to the beneficiaries, planning is pretty straightforward. On the other hand, the more assets, the more beneficiaries, and the more instructions may require an estate plan that is more complex and varied.
Generally, there are two components of estate planning with one involving the legal aspects of it and the other involving the non-legal aspects of the plan. Your estate planning attorney can help with both. Legally speaking, your lawyer will review your personal and financial situation and create documents that address the latter. Non-legally speaking, your lawyer will develop an investment strategy for retirement purposes.
What goes into an estate plan in California?
An estate plan will include the documents that accommodate your specific needs. It may involve some or all of the following:
- Last will and testament
- Living trust
- Irrevocable trusts (e.g., life insurance trusts, gift trusts, special needs trust, charitable trust)
- Conservatorship
- Guardianships
- Asset protection from divorce, creditors, others
- Health care directives, including medical powers of attorney, living wills, health care proxy, do not resuscitate (DNR) or do not intubate (DNI) orders
- Succession plan for business
- Charitable planning
What is probate?
Probate is the legal process of transferring the property from a deceased person’s estate to their heirs or beneficiaries. It is overseen by the local probate court.
What happens if I die without a will in California?
If you die without a will in California, you die “intestate.” Your assets will be distributed according to California’s intestacy laws, which dictate how property is passed to heirs based on their relationship to you. These laws may not align with your personal wishes, which is why having a will is crucial.
What happens to my will if I move to a new state?
If you move to a new state, your will is generally still valid, but state laws vary, and differences in property and inheritance laws could impact your estate plan. For example, states have different rules about community property and spousal rights. It’s advisable to have your will reviewed by an attorney in your new state to ensure it reflects your current wishes and complies with local laws.
Do I need a lawyer to write my will?
While it is not legally required to hire a lawyer to write a will in California, doing so can significantly reduce the risk of errors or challenges. A will that is not properly drafted or executed may be contested in court, leading to confusion, delays, or unintended outcomes. An experienced estate planning attorney can help ensure your will is clear, legally valid, and fully reflective of your wishes.
Can you write a will if you have Alzheimer’s or dementia?
In California, to create a valid will, you must have “testamentary capacity,” which means you understand the nature of your property, the identity of your beneficiaries, and the implications of your decisions. If you have Alzheimer’s or dementia, it may be challenging to meet this standard. However, it’s still possible to create a will if you have lucid moments or are in the early stages of the disease. Consulting with an attorney is essential to ensure the will’s validity.
Do I need a Will if I have no children?
Yes, even if you have no children, a will is important to ensure that your assets are distributed according to your wishes. Without a will, your estate will be distributed according to California’s intestacy laws, which may pass your assets to distant relatives or, in the absence of heirs, to the state. A will allows you to direct your assets to people, organizations, or causes that matter most to you.
Does my will automatically change if I divorce?
In California, divorce does not automatically revoke your will. However, unless your will specifically states otherwise, any provisions that benefit your former spouse are likely to be revoked upon divorce. It is important to update your will and other estate planning documents after a divorce to ensure your current wishes are properly reflected.
Does my will automatically change if I have a child?
In California, whether your will needs to be updated after having a child depends on the language used in your existing will. If your will includes provisions for “all children,” then your new child may be covered. However, it’s still advisable to review and possibly update your will to ensure that it fully reflects your intentions for all your children.
What is the difference between a will and a living will?
A will, or last will and testament, outlines how your assets should be distributed after your death and appoints an executor to manage your estate. A living will, also known as an advance health care directive in California, specifies your wishes for medical treatment if you become incapacitated and are unable to communicate your preferences.
What is a trust?
A trust is a legal arrangement where one party (the trustee) holds and manages assets for the benefit of another party (the beneficiary). Trusts can be an effective way to manage and protect assets, avoid probate, and provide for loved ones.
What is the purpose of a trust in California?
In California, trusts are often used to manage assets, avoid probate, and provide for beneficiaries according to specific terms. A trust can be especially useful for minor children, individuals with special needs, or beneficiaries who may need assistance managing their inheritance. Trusts also offer privacy, as they are not subject to the public probate process.
Can I have both a will and a trust in California?
Yes, it’s common to have both a will and a trust as part of a comprehensive estate plan. Many people use a trust to manage specific assets and a will to cover any assets not included in the trust. Additionally, a will can create a testamentary trust that goes into effect after your death.
Are Trusts Only for Wealthy Individuals in California?
No, trusts can benefit anyone who wants to manage how their assets are distributed, particularly when there are concerns about beneficiaries’ ability to manage assets themselves or when avoiding probate is a priority. Trusts are also useful for parents of minor children or individuals with special needs.
What happens to jointly owned property when one spouse dies?
In California, jointly owned property (such as property held as joint tenants or community property with right of survivorship) automatically passes to the surviving spouse upon the death of the other spouse, bypassing probate.
What is a guardian?
A guardian is a person legally appointed to care for and make decisions on behalf of another person, typically a minor or someone who is incapacitated. In California, you can designate a guardian for your minor children or adult dependents in your will.
How can I designate a guardian for my children?
In California, you can designate a guardian for your minor children in your will. This ensures that your children are cared for by someone you trust if you pass away. Without a designated guardian, the court will appoint one, which may not align with your wishes.
How Can We Ensure Our Special Needs Child is Cared for After We Die?
To ensure your special needs child is cared for after your death, you can establish a special needs trust, which provides financial support without jeopardizing eligibility for government benefits. Additionally, you can appoint a guardian to manage their personal and financial affairs.
How can I make sure my pet is cared for after I die?
In California, you can ensure your pet is cared for by naming a caretaker in your will and creating a pet trust, which sets aside funds for their care.
When do I need a power of attorney in California?
A power of attorney is crucial if you become unable to make medical or financial decisions for yourself due to incapacity. California recognizes several types of powers of attorney, each with a specific purpose:
- Durable Power of Attorney: Remains in effect if you become incapacitated, allowing your agent to manage your financial affairs.
- Medical Power of Attorney (Advance Health Care Directive): Allows you to designate someone to make healthcare decisions on your behalf if you are unable to do so.
- General Power of Attorney: Authorizes your agent to act on your behalf in a broad range of matters but becomes invalid if you become incapacitated.
- Limited (Special) Power of Attorney: Grants your agent authority to act in specific situations or for a limited period.
- Springing Power of Attorney: Only takes effect under certain conditions, such as your incapacitation.
Contact an Estate Planning Lawyer in California Today
At Bay Legal, PC, we know you have lots of questions about estate planning. Our estate planning lawyer in California is here to answer your specific questions. Contact us either by using our online form or calling us directly at 650-374-7900 to schedule a Consultation.
Schedule a Consultation Today
Don’t wait until it’s too late. Get peace of mind knowing that your wishes are secured. Contact Bay Legal, PC today to schedule your consultation with an experienced California estate planning attorney.
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