Moving to a New State? Be Sure to Update Your Estate Plan

Although you likely won’t need to have an entirely new estate plan prepared for you, upon relocating to another state, you should definitely have your existing plan reviewed by an estate planning lawyer who is familiar with your new home state’s laws. Each state has its own laws governing estate planning, and those laws can differ significantly from one location to another.

Given this, you’ll want to make sure your planning documents all comply with the new state’s laws, and the terms of those documents still work as intended. Here, we’ll discuss how differing state laws can affect common planning documents and the steps you might want to take to ensure your documents are properly updated.

 

Last Will and Testament
The good news is, states will generally accept a will that was executed properly under another state’s laws. However, there could be differences in the new state’s laws that make certain provisions in your will invalid. Here are a few of the things you should pay the most attention to in your will when moving:

 

Your executor: Consider whether or not the executor or administrator you’ve chosen will be able to serve in that role in your new location. Every state will allow an out-of-state executor to serve, but some states have special requirements that those executors must meet, such as requiring them to post a bond before serving. Other states require non-resident executors to appoint an agent who lives within the state to accept legal documents on behalf of the estate.

 

Marital property: If you are married, give special consideration to how your new state treats marital property. While a common-law state might treat the property you own in your name alone as yours, community-property states treat all of your property as owned jointly with your spouse. If your new state treats marital property differently, you might need to draft a new will to ensure your wishes are honored.

 

Interested witnesses: Another important role under your will to consider when moving to a new state is an interested witness. An interested witness is someone who was a witness to your will who also receives a gift from your will. Some states allow interested witnesses to receive the gift, while other states do not allow such gifts. And still other states allow such gifts provided the witness is a family member.

 

Revocable Living Trust

A valid revocable living trust from one state should continue to be valid in your new state. However, you need to make certain that you transfer any new assets or property you acquire, such as your new home, to your trust, so that those assets can avoid the need to go through probate before being distributed to your heirs upon your death.

 

Power of Attorney
A valid power of attorney document, such as a durable power of attorney, medical power of attorney, or financial power of attorney, created in one state is likely to be valid in your new state. However, in some cases, banks, financial institutions, and healthcare facilities in your new state may not accept a power of attorney document if it’s unfamiliar to them. Also, simply as a practical matter, it may be a good idea to have your power of attorney agent live in the same state you do, so keep that in mind as well.

 

Beneficiary Designations
If you have accounts with beneficiary designations, such as 401(k)s, life insurance policies, and payable-on-death bank accounts, these should be valid no matter which state you live in. That said, you should still review these documents when you move to ensure that your address and other personal information is updated.

 

Keep Your Plan Current
As with other major life events, such as births, deaths, marriage and divorce, moving to a new state is the ideal time to have your plan reviewed by a professional.

With people living longer than ever before, more and more seniors require long-term healthcare services in nursing homes and assisted living facilities. However, such care is extremely expensive, especially when it’s needed for extended periods of time.

Traditional healthcare insurance doesn’t cover such services, and though Medicare does pay for some long-term care, it’s quite limited, difficult to qualify for, and requires you to deplete nearly all of your assets before being eligible (though proactive estate planning can help shield your assets). To address this gap in coverage, long-term care insurance was created.

Intensive Care

First introduced as “nursing home insurance” in the 1980s, this type of insurance is designed to cover expenses associated with long-term skilled nursing services delivered in a nursing home, assisted living facility, or other senior care setting, though some of today’s policies cover care delivered in your own home as well.

Such intensive care is required when you are no longer able to care for yourself, often in the later stages of your life. These policies cover the cost of skilled nursing services that support you with basic self-care tasks, such as bathing, feeding, dressing, walking, and using the bathroom. These are known as activities of daily living (ADLs).

Before your coverage kicks in, most policies require that you demonstrate you have lost the ability to engage in at least two or three ADLs. Most policies also have a deductible, or elimination period, which is a set number of days that must elapse between the time you become disabled (eligible for benefits) and the time your coverage kicks in.

Many policies offer a 90-day elimination period, but others can be longer, shorter, or even have no elimination period at all. Of course, the shorter the elimination period, the more expensive the premium.

Additionally, long-term care policies typically come with a predetermined benefit period, which is the number of years of care it will pay for. A benefit period of three to five years, for example, is a quite common duration for such policies. Most policies also come with a cap on the dollar amount of coverage that will be paid for care on a daily basis, known as a daily benefit amount.

Getting Covered

Obviously, the younger and healthier you are when you buy the policy, the cheaper the premiums will be, so the sooner you invest in coverage, the better. In fact, most policies exclude certain pre-existing conditions, so if you wait until you become ill, it can be impossible to find coverage.

Increasing Premiums, Decreasing Benefits
With the elderly population booming, there has been a surge in demand for long-term care services, which has led to a marked increase in the cost of such policies. At the same time, many insurers have been cutting back on the benefits their policies offer.

If you are looking to purchase long-term care insurance, you should speak with multiple insurance providers and compare their benefits, care options, and premiums. Different companies may offer the same coverage and benefits, but they can vary dramatically in price. Always ask about the insurance company’s history of rate increases, including the amount of the most recent increase.

Choose Wisely

For the best chances of success when shopping for a policy, get help from a fee-only planner, who is not compensated based on your choice of coverage. When meeting with an insurance provider, you must get answers to following three questions about your policy:

  1. How long is the elimination period before the policy begins paying benefits?
  2. What capacities, or ADLs, must you lose before coverage kicks in?
  3. How many years of care are covered?

Buying long-term care insurance should be a family affair, because you are going to need your family members to advocate for you and file a claim for the policy when you need to use it. Given this, make sure your family knows what kind of policy you have, who your agent is, and how to make a claim.

What’s more, you should pre-authorize the right person to speak to the insurance company on your behalf, and not just rely on a power of attorney. That said, you should definitely have a well-drafted, updated, and regularly reviewed power of attorney on file as well.

Keep Your Policy Updated

Once you are in your 40s, your long-term care policy should be reviewed annually to evaluate new insurance products on the market and update your policy based on your changing needs. And whatever you do, once you have a policy in place, make sure you don’t miss a premium payment, because if you stop paying, even for a short period of time, you’ll lose all of the money you invested and will have no access to the benefits when you need them.

7 QUESTIONS TO ASK BEFORE HIRING A LAWYER – Metro Law and Mediation

Since you’ll be discussing topics like death, incapacity, and other frightening life events, hiring an estate planning lawyer may feel intimidating or even morbid. But it doesn’t have to be that way.
Instead, it can be the most empowering decision you ever make for yourself and your loved ones. The key to transforming the experience of hiring a lawyer from one that you dread into one that empowers you is to educate yourself first. This is the person who is going to be there for your family when you can’t be, so you want to really understand who the lawyer is as a human, not just an attorney. Of course, you’ll also want to find out the kind of services your potential lawyer offers and how they run their business.
To this end, here are five questions to ask to ensure you don’t end up paying for legal services that you don’t need, expect, or want. Once you know exactly what you should be looking for when choosing a planning professional, you’ll be much better positioned to hire an attorney who will provide the kind of love, attention, care, and trust your family deserves.

   1. How do you bill for your services?

There’s no reason you should be afraid to ask a lawyer how he or she bills for the work they do on your behalf. In fact, questions about billing and payment should be thoroughly discussed before you engage any lawyer to represent you. No one wants surprises, especially when it comes to legal fees.

Find an estate planning lawyer who bills for their services on a flat-fee, no surprises, basis—and not on an hourly basis—unless it’s required for limited purposes. And ideally, you want a lawyer who will guide you through a process of discovery in which they learn about your family dynamics, your assets, and they educate you about what would happen for your family and to your assets if and when something happens to you, and then support you in choosing the right plan for you that meets your budget and your desired outcomes.

  1. How will you respond to my needs on an ongoing basis?

One of the biggest complaints people have about working with lawyers is that they are notoriously unresponsive. Indeed, I’ve heard of cases in which clients went weeks without getting a call back from their lawyer. This is all too common, but totally unacceptable, especially when you’re paying them big bucks.

That said, in most cases, these lawyers aren’t blowing you off—they simply don’t have enough support or the systems in place to be able to be responsive. Far too many lawyers believe they can take care of everything themselves. From paperwork and client meetings to scheduling and returning phone calls to connecting their clients with other advisors, there are just too many responsibilities for one person to manage all on their own.

Ask them how quickly calls are typically returned in their office, ask them if there will be someone on-hand to answer quick questions, and ask them how they will support you to keep your plan up to date on an ongoing basis and be there for your loved one’s when you can’t be.

A great way to test this is to call your prospective lawyer’s office and ask for him or her. If you get put through right away—or even worse, your call gets sent to a full voicemail—think twice about hiring this lawyer. This means they don’t have effective systems in place for managing and responding to calls or answering quick questions.

Instead, what you want is for the person who answers the phone—or another team member—to offer to help you. And if that individual cannot help you, then he or she should schedule a call for you to talk with your lawyer at a future date and time. Ideally, all calls with your lawyer should be pre-scheduled with a clear agenda, so you both can be ready to focus on your specific needs.

Next week in part two, we’ll talk more about the ways in which your attorney should communicate with you and list the remaining three questions to ask before hiring your estate planning lawyer.

Don't Think of Remarrying Until You Read This - MM #108 - Marriage Missions International

Today, we’re seeing more and more people getting divorced in middle age and beyond. In fact, roughly one in four divorces involve those over 50, and divorce rates for this demographic have doubled in the past 30 years, according to the study Gray Divorce Revolution. For those over age 65, divorce rates have tripled.

With divorce coming so late in life, the financial fallout can be quite devastating. Indeed, Bloomberg.com found that the standard of living for women who divorce after age 50 drops by some 45%, while it falls roughly 21% for men. Given the significant decrease in income and the fact people are living longer than ever, it’s no surprise that many of these folks also choose to get remarried.

And those who do get remarried frequently bring one or more children from previous marriages into the new union, which gives rise to an increasing number of blended families. Regardless of age or marital status, all adults over age 18 should have some basic estate planning in place, but for those with blended families, estate planning is particularly vital.

Here, we’ll use three different hypothetical scenarios to discuss how a failure to update your estate plan after a midlife remarriage has the potential to accidently disinherit your closest family members, as well as deplete your assets down to virtually nothing. From there, we’ll look at how these negative outcomes can be easily avoided using a variety of different planning solutions.

Scenario #1: Accidentally disinheriting your children from a previous marriage

John has two adult children, David and Alexis, from a prior marriage. He marries Moira, who has one adult child, Patrick. The blended family gets along well, and because he trusts Moira will take care of his children in the event of his death, John’s estate plan leaves everything to Moira.

After just two years being married, John dies suddenly of a heart attack, and his nearly $1.4 million in assets go to Moira. Moira is extremely distraught following John’s death, and although she wants to update her plan to include David and Alexis, she never gets around to it, and dies just a year after John. Upon her death, all of the assets she brought into the marriage, along with all of John’s assets, pass to Moira’s son Patrick, while David and Alexis receive nothing.

There are several planning options John could’ve used to avoid this outcome. He could have created a revocable living trust that named an independent successor trustee to manage the distribution of his assets upon his death to ensure a more equitable division of his estate between his spouse and children. Or, he could have created two separate trusts, one for Moira and one for his children, in which John specified exactly what assets each individual received. He might have also taken advantage of tax-free gifts to his two children during his lifetime.

Scenario #2: Accidentally disinheriting your spouse

Mark was married to Gwen for 30 years, and they had three children together, all of whom are now adults. When their kids were young, Mark and Gwen both created wills, in which they named each other as their sole beneficiaries. When they were both in their 50s, and their kids had grown, Bob and Gwen divorced.

Several years later, at age 60, Bob married Veronica, a widow with no children of her own. Bob was very healthy, so he didn’t make updating his estate plan a priority. But within a year of his new marriage, Bob died in a car accident.

Bob’s estate plan, written several decades ago, leaves all of his assets to ex-wife Gwen, or, if she is not living at the time of his death, to his children. State law presumes that Gwen has predeceased Bob because they divorced after the will was enacted. Thus, all of Bob’s assets, including the house he and Veronica were living in, pass to his children. Veronica receives nothing, and is forced out of her home when Bob’s children sell it.

By failing to update his estate plan to reflect his current situation, Bob unintentionally disinherited Veronica and forced her into a precarious financial position just as she was entering retirement. If Bob had worked with an estate planning attorney to create a living trust, he could have arranged his assets so they would go to, and work for, exactly the people he wanted them to benefit.

Scenario #3: Allowing Assets to Become Depleted

Steve is a divorcee in his early 60s with two adult children when he marries Susan. Steve has an estate valued at around $850,000, and he has told his kids that after he passes away, he hopes they will use the money that’s left to fund college accounts for their own children. But he also wants to ensure Susan is cared for, so he establishes a living trust in which he leaves all his assets to Susan, and upon her death, the remainder to his two children.

Yet, soon after Steve dies, Susan suffers a debilitating stroke. She requires round-the-clock in-home care for several decades, which is paid for by Steve’s trust. When she does pass away, the trust has been almost totally depleted, and Steve’s children inherit virtually nothing.

An experienced estate planning attorney could have helped Steve avoid this unfortunate outcome. Steve could have stipulated in his living trust that a certain portion of his assets must go to his children upon his death, while the remainder passed to Susan.

Bringing families together
Along with other major life events like births, deaths, and divorce, entering into a second (or more) marriage requires you to review and rework your estate plan. And updating your plan is exponentially more important when there are children involved.

 

Writing a Will: Avoid these 8 mistakes while writing a will to ensure your assets are passed onto your heirs

 

A will is one of the most basic estate planning tools. While relying solely on a will is not a suitable option for most people, just about every estate plan includes this key document in one form or another.

A will is used to designate how you want your assets distributed to your surviving loved ones upon your death. If you die without a will, state law governs how your assets are distributed, which may or may not be in line with your wishes.

That said, not all assets can (or should) be included in your will. For this reason, it’s important to understand which assets you should put in your will and which assets you should include in other planning documents like trusts.

While you should always consult with an experienced planning professional when creating your will, here are a few of the different types of assets that should not be included in your will.

      1. Assets with a right of survivorship: A will only covers assets solely owned in your name. Therefore, property held in joint tenancy, tenancy by the entirety, and community property with the right of survivorship, bypass your will. These types of assets                 automatically pass to the surviving co-owner(s) when you die, so leaving your share to someone else in your will would have no effect. If you want someone other than your co-owner to receive your share of the asset upon your death, you will need to change             title to the asset as part of your estate planning process.

  1. Assets held in a trust: Assets held by a trust automatically pass to the named beneficiary upon your death or incapacity and cannot be passed through your will. This includes assets held by both revocable “living” trusts and irrevocable trusts.In contrast, assets included in a will must first pass through the court process known as probate before they can be transferred to the intended beneficiaries. To avoid the time, expense, and potential conflict associated with probate, trusts are typically a more effective way to pass assets to your loved ones compared to wills.

However, because it can be difficult to transfer all of your assets into a trust before your death, even if your plan includes a trust, you’ll still need to create what’s known as a “pour-over” will. With a pour-over will in place, all assets not held by the trust upon your death are transferred, or “poured,” into your trust through the probate process.

 

  1. Assets with a designated beneficiary: Several different types of assets allow you to name a beneficiary to inherit the asset upon your death. In these cases, when you die, the asset passes directly to the individual, organization, or institution you designated as beneficiary, without the need for any additional planning.The following are some of the most common assets with beneficiary designations, and therefore, such assets should not be included in your will:
  • Retirement accounts, IRAs, 401(k)s, and pensions
  • Life insurance or annuity proceeds
  • Payable-on-death bank accounts
  • Transfer-on-death property, such as bonds, stocks, vehicles, and real estate
  1. Certain types of digital assets: Given the unique nature of digital assets, you’ll need to make special plans for your digital assets outside of your will. Indeed, a will may not be the best option for passing certain digital assets to your heirs. And in some cases—including Kindle e-books and iTunes music files—it may not even be legally possible to transfer the asset via a will, because you never actually owned the asset in the first place—you merely owned a license to use it.What’s more, some types of social media, such as Facebook and Instagram, have special functions that allow you to grant certain individuals access and/or control of your account upon your death, so a will wouldn’t be of any use. Always check the terms of service for the company’s specific guidelines for managing your account upon your death.

Regardless of the type of digital asset involved, NEVER include the account numbers, logins, or passwords in your will, which becomes public record upon your death and can be easily read by others. Instead, keep this information in a separate, secure location, and provide your fiduciary with instructions about how to access it.

       5. Your pet and money for its care: Because animals are considered personal property under the law, you cannot name a pet as a beneficiary in your will. If you do, whatever money you leave it would go to your residuary beneficiary (the individual who                   gets everything not specifically left to your other named beneficiaries), who would have no obligation to care for your pet.

It’s also not a good idea to use your will to leave your pet and money for its care to a future caregiver. That’s because the person you name as beneficiary would have no legal obligation to use the funds to care for your pet. In fact, your pet’s new owner could legally keep all of the money and drop off your furry friend at the local shelter.

The best way to ensure your pet gets the love and attention it deserves following your death or incapacity is by creating a pet trust. A good estate planning attorney can help you set up, fund, and maintain such a trust, so your furry family member will be properly cared for when you’re gone.

  1. Money for the care of a person with special needs: There are a number of unique considerations that must be taken into account when planning for the care of an individual with special needs. In fact, you can easily disqualify someone with special needs for much-needed government benefits if you don’t use the proper planning strategies. To this end, a will is not a suitable way to pass on money for the care of a person with special needs.If you want to provide for the care of your child or another loved one with special needs, you must create a special needs trust. Given these are extremely technical, you should always work with an experienced planning lawyer to create a special needs trust.

Don’t take any chances
Although creating a will may seem fairly simple, it’s always best to consult with an experienced planning professional to ensure the document is properly created, executed, and maintained. And as we’ve seen here, there are also many scenarios in which a will won’t be the right planning option, nor would a will keep your family and assets out of court

 

How 'Gray Divorce' Complicates Estate Planning | ThinkAdvisor

Last week in part one [https://www.calilaw.com/getting-divorced-dont-overlook-these-4-updates-to-your-estate-plan-part-1/], we discussed the first two changes you should make to your plan if you’re getting divorced: updating your beneficiary designations and power of attorney documents. Here in part two, we’ll cover the final updates to consider.

  1. Create a new will
    Creating a new will is not something that can wait until after your divorce. In fact, you should create a new will as soon as you decide to get divorced, since once divorce papers are filed, you may not be able to change your will. And because most married couples name each other as their executor and the beneficiary of their estate, it’s important to name a new person to fill these roles as well.

    When creating a new will, rethink how you want your assets divided upon your death. This most likely means naming new beneficiaries for any assets that you’d previously left to your future ex and his or her family. Keep in mind that California has community-property laws that entitle your surviving spouse to a certain percentage of the marital estate upon your death, no matter what your will dictates. So if you die before the divorce is final, you probably won’t be able to entirely disinherit your surviving spouse through the new will.

Yet, it’s almost certain you wouldn’t want him or her to get everything. With this in mind, you should create your new will as soon as possible once divorce is inevitable to ensure the proper individuals inherit the remaining percentage of your estate should you pass away while your divorce is still ongoing.

  1. Amend your existing trust or create a new one

If you have a revocable living trust, you’ll want to review and update it, too. In addition to reconsidering what assets your soon-to-be-ex spouse should receive through the trust, you’ll probably want to replace him or her as successor trustee, if they are so designated.

And if you don’t have a trust in place, you should seriously consider creating one, especially if you have minor children. Trusts provide a wide range of powers and benefits unavailable through a will, and they’re particularly well-suited for blended families. Given the possibility that both you and your spouse will eventually get remarried—and perhaps have more children—trusts are an invaluable way to protect and manage the assets you want your children to inherit.

By using a trust, for example, should you die or become incapacitated while your kids are minors, you can name someone of your choosing to serve as successor trustee to manage their money until they reach adulthood, making it impossible for your ex to meddle with their inheritance.

Beyond this key benefit, trusts afford you several other levels of enhanced protection and control not possible with a will. For this reason, you should at least discuss creating a trust with an experienced lawyer before ruling out the option entirely.

Post-divorce planning

During the divorce process, your primary estate planning goal is limiting your soon-to-be ex’s control over your life and assets should you die or become incapacitated before divorce is final. In light of this, the individuals to whom you grant power of attorney, name as trustee, designate to receive your 401k, or add to your plan in any other way while the divorce is ongoing are often just temporary.

Once your divorce is final and your marital property has been divided up, you should revisit all of your planning documents and update them based on your new asset profile and living situation. From there, your plan should continuously evolve as your life changes, especially following major life events, such as getting remarried, having additional children, and when close family members pass away.

 

 

How Divorce Affects Your Estate Plan | legalzoom.com

Going through divorce can be an overwhelming experience that impacts nearly every facet of your life, including estate planning. Yet, with so much to deal with during the divorce process, many people forget to update their plan or put it off until it’s too late.

Failing to update your plan for divorce can have a number of potentially tragic consequences, some of which you’ve likely not considered—and in most cases, you can’t rely on your divorce lawyer to bring them up. If you are in the midst of a divorce, and your divorce lawyer has not brought up estate planning, there are several things you need to know. First off, you need to update your estate plan, not only after your divorce is final, but as soon as you know a split is inevitable.

Here’s why: until your divorce is final, your marriage is legally in full effect. This means if you die or become incapacitated while your divorce is ongoing and haven’t updated your estate plan, your soon-to-be ex-spouse could end up with complete control over your life and assets. And that’s generally not a good idea, nor what you would want.

Given that you’re ending the relationship, you probably wouldn’t want him or her having that much power, and if that’s the case, you must take action. While state laws can limit your ability to make certain changes to your estate plan once your divorce has been filed, here are a few of the most important updates you should consider making as soon as divorce is on the horizon.

1. Update your power of attorney documents
If you were to become incapacitated by illness or injury during your divorce, the very person you are paying big money to legally remove from your life would be granted complete authority over all of your legal, financial, and medical decisions. Given this, it’s vital that you update your power of attorney documents as soon as you know divorce is coming.

Your estate plan should include both a durable financial power of attorney and a medical power of attorney. A durable financial power of attorney allows you to grant an individual of your choice the legal authority to make financial and legal decisions on your behalf should you become unable to make such decisions for yourself. Similarly, a medical power of attorney grants someone the legal authority to make your healthcare decisions in the event of your incapacity.

Without such planning documents in place, your spouse has priority to make financial and legal decisions for you. And since most people typically name their spouse as their decision maker in these documents, it’s critical to take action—even before you begin the divorce process—and grant this authority to someone else, especially if things are anything less than amicable between the two of you.

2. Update your beneficiary designations
As soon as you know you are getting divorced, update beneficiary designations for assets that do not pass through a will or trust, such as bank accounts, life insurance policies, and retirement plans. Failing to change your beneficiaries can cause serious trouble down the road.

For example, if you get remarried following your divorce, but haven’t changed the beneficiary of your 401(k) plan to name your new spouse, the ex you divorced 15 years ago could end up with your retirement account upon your death. And due to restrictions on changing beneficiary designations after a divorce is filed, the timing of your beneficiary change is particularly critical.

In California, once either spouse files divorce papers with the court, neither party can legally make changes to non-probate transfers without the consent of their soon to be ex-spouse. This means you can make a new will (since that’s a probate transfer) but you cannot change your trust, IRA, 401k or life insurance beneficiaries. With this in mind, if you’re anticipating a divorce, you may want to consider changing your beneficiaries prior to filing divorce papers, and then post-divorce you can always change them again to match whatever is determined in the divorce settlement.

 

Serving as a Trustee - What to Know

Being asked by a loved one to serve as trustee for their trust upon their death can be quite an honor, but it’s also a major responsibility—and the role is definitely not for everyone. Indeed, serving as a trustee entails a broad array of duties, and you are both ethically and legally required to properly execute those duties or face potential liability.

In the end, your responsibility as a trustee will vary greatly depending on the size of the estate, the type of assets covered by the trust, the type of trust, how many beneficiaries there are, and the document’s terms. In light of this, you should carefully review the specifics of the trust you would be managing before making your decision to serve.

And remember, you don’t have to take the job.

Yet, depending on who nominated you, declining to serve may not be an easy or practical option. On the other hand, you might actually enjoy the opportunity to serve, so long as you understand what’s expected of you.

To that end, this article offers a brief overview of what serving as a trustee typically entails. If you are asked to serve as trustee, feel free to contact us to support you in evaluating whether you can effectively carry out all the duties or if you should politely decline.

A trustee’s primary responsibilities
Although every trust is different, serving as trustee comes with a few core requirements. These duties primarily involve accounting for, managing, and distributing the trust’s assets to its named beneficiaries as a fiduciary.

As a fiduciary, you have the power to act on behalf of the trust’s creator and beneficiaries, always putting their interests above your own. Indeed, you have a legal obligation to act in a trustworthy and honest manner, while providing the highest standard of care in executing your duties.

This means that you are legally required to properly manage the trust and its assets in the best interest of all the named beneficiaries. And if you fail to abide by your duties as a fiduciary, you can face legal liability. For this reason, you should consult with us for a more in-depth explanation of the duties and responsibilities a specific trust will require of you before agreeing to serve.

Regardless of the type of trust or the assets it holds, some of your key responsibilities as trustee include:

  • Identifying and protecting the trust assets
  • Determining what the trust’s terms require in terms of management and distribution of the assets
  • Hiring and overseeing an accounting firm to file income and estate taxes for the trust
  • Communicating regularly with beneficiaries and meeting all required deadlines
  • Being scrupulously honest, highly organized, and keeping detailed records of all transactions
  • Closing the trust when the trust terms specify

No experience necessary
It’s important to point out that being a trustee does NOT require you to be an expert in law, finance, taxes, or any other field related to trust administration. In fact, trustees are not only allowed to seek outside support from professionals in these areas, they’re highly encouraged to do so, and the trust estate will pay for you to hire these professionals.

So even though serving as a trustee may seem like a daunting proposition, you won’t have to handle the job alone. And you are also often able to be paid to serve as trustee of a trust.

Wills, trusts, health care directives, powers of attorney, and legal guardian nominations are on many of our hearts and minds as COVID-19 compels us to face our own fragility and mortality.

It’s not as if we didn’t already know we are all mortal, but within our current reality, that mortality becomes all the more real. And one way to feel some control over what’s happening out there is to make sure we all have our legal affairs in order at home. That way, if something does happen to us, our families aren’t left with a big legal mess to clean up while they are grieving.

If you are trying to get your financial house in order right now, you may be just getting some basic documents in place. You may even be doing it yourself.

If that’s the case, it’s very important for you to know that the cost of a failed plan can be very high for the people you love. Plus, if your documents are not properly signed, they will not work—period. End of story. And if your documents don’t work, your family could be stuck in court or conflict, which is probably the exact thing you want to avoid by handling your estate planning now.

There are many ways plans fail, but one of the worst ways we see is when someone starts a plan and doesn’t get it signed properly. You do not want this to happen to your family, trust me. If you care enough about estate planning, you will want to make sure your plan will work when your family needs it.

That means you need to make sure your legal documents are actually signed and signed in the right way. Some legal documents require two witnesses, and some require notarization; however, in today’s social-distancing reality, these signatures could be difficult to come by. Some states have allowed remote notarization, California for some reason, has not.

While we understand you likely have a desire to get documents in place now, we also believe there is going to be a significant increase in conflict and litigation because of DIY estate planning documents for the future. Don’t let that happen to the people you love.

Dedicated to empowering your family, building your wealth and defining your legacy,

With all the media about “digital wills” and “online estate planning” it could be tempting to think you can do your estate planning yourself, online. And, maybe you can. But, if you do, you need to know the potential pitfalls. Online estate planning could be a big trap for the unwary and end up leaving your family worse off than if you had done nothing at all.

First and foremost, before you do any of your own online estate planning, it’s critical to understand your family dynamics, the nature of your assets, and what the state of California would say should happen to your assets if something happens to you. You see, if you don’t do estate planning, the state does have a plan for your assets if you become incapacitated or when you die. You need to know what that plan is, so you know whether you want to change it.

But Don’t I Need a Will and Can’t I Just Do It Online?
Here’s the funny thing about estate planning: the one legal document that everyone thinks they need most actually does the least.

Every adult does need SOME estate planning. A will is always a good idea because it says who gets, and who oversees distributing, what you have. However, if the default law would have given your assets to the same people you would choose and authority to the person you would name anyway, then an online will would probably do nothing valuable for you at all.

Even a properly drafted will does not keep your family out of court (a will must always be adjudicated by a judge). And if drafted improperly, it could require the person you’ve named to handle things for you to get a bond, which is like an insurance policy. These are expensive and can be hard to get for an executor who has less than a stellar credit score. If your named executor cannot get a bond, it would then mean the court would appoint a court ordered executor, and that can be costly for your estate. This is just one of the examples of how having a will prepared online, can create more expense for the people you love. Unfortunately, all the online will preparation solutions I’ve reviewed don’t even mention this risk.

So, yes, you can do your own will online, but at what potential cost for the people you love?

The Problem with Online Wills
DIY online estate plans (and even many estate plans created by lawyers) usually include three or four basic documents: a will, a financial power of attorney, an advance health care directive, and possibly a trust.

But, honestly, completing these documents without counsel is simply not enough to guarantee your estate will be executed as simply, affordably, and effectively as you would wish.

For instance—are you sure there isn’t some missing consideration that could lead to turmoil as your family tries to figure it out? Did you know that most family fights don’t even happen over money, but over lack of clarity? Have you considered all your extended family, including stepchildren and ex-spouses? What will be done with all the personal, sentimental items you want to pass on to your children?

And there have been far too many scenarios where seniors, even those who had some estate planning done, get caught in the court system or even declared incompetent, and then have court-appointed guardians named, who then drain their accounts. In many cases, their assets are gutted before they can go to their kids. You don’t want that to happen to you or your family and a do-it-yourself will makes that outcome more likely, not less.

What about making sure your family knows what you have and where it is? An online will won’t tell them that. There’s nearly $10 billion being held in the California department of unclaimed property; much of it because someone died and their family lost track of their assets.

So how can you be sure you’ve got everything covered, legally?

With online wills and DIY estate planning docs, you wouldn’t even know what questions to ask to uncover the potential risks to the people you love, who deserve to receive what you’ve created in your life, without a big mess.

Think about this: do you know anyone who has lost family relationships because, after a loved one died, the family ended up in an irrevocable fight? Maybe this has even happened in your own family. I see it all the time and the consequences—both, financial and emotional—can be devastating.

And, it’s all unnecessary.

Yes, even if there are attorneys on staff at these online companies, they don’t get to know you and your family dynamics enough to spot the real issues that could arise. They are, instead, focused on a one-size-fits-all solution and easy answers to complex issues.

The Kind of Help Your Family Deserves
Many lawyers who specialize in estate planning often base their work on template documents. Even if they are well-intentioned, they’re working with an old, traditional system that places the focus solely on providing documents. But the documents are only as good as the understanding a lawyer has about your family dynamics, the nature of your assets, how the law will apply to your situation, and how the documents can be written as simply as possible to achieve your wishes. You need much more than just a set of four or five filled-out template documents to address all those complexities.

Your plan should include an inventory of your assets and guarantee they are all owned in a way that will keep your family out of court and conflict while ensuring everyone named in your plan has what they need and understands your choices. Most importantly, you should understand your plan and ensure that it passes along more than just your money.

Do it yourself estate planning is risky. While it may be better than nothing, it may also be worse. And it won’t be until after you are gone that your loved ones find out that answer.

Dedicated to empowering your family, building your wealth and defining your legacy,