California’s probate courts are very clear about who inherits what when an individual dies (the “decedent”) without a will, trust, or estate plan in place.
The decedent’s assets (properties, cars, possessions, businesses, and even digital property) are distributed to his/her immediate family members, in a very specific, legally-specific order. This is why estate planning is so necessary – even if you don’t have children of your own.
If you opt to skip the estate planning process, hoping your relatives will figure it all out for you, we highly encourage you to think again. It’s not surprising that the legal system has a very clear and linear progression when it comes to who should inherit what – beginning with those who are your closest relatives. But this can send them into a tizzy when it happens and can make for painful deliberations and tough decisions for the ones you love most – as well as the ones you love least.
For example, unless your family decides to battle it out in a probate court (a very expensive, emotional, and energy-consuming process), the father you’ve hardly spoken to could stand to inherit the lion’s share of your assets, despite the fact you have a step-father who joined the picture later in life but treated you like his own. A dreaded aunt may get a very generous portion of your possessions and belongings while the cousin who’s been like a sibling to you gets little to nothing at all.
And, that’s just the beginning of the not-so-pleasant story of what happens to estates without an established, legally sound plan.
It is essential to create legal documents outlining what will happen to your pets when you die or if you are incapacitated (unable to make legal decisions for yourself as the result of an illness, injury, or mental disorder).
We can structure your estate plan to include:
- Who will be taking care of your pets
- A “trust fund” to pay for your pets’ food, pet sitting, and veterinary costs
- Your plan for your pet when s/he dies (is there a favorite pet cemetery where you’ve made plans? Or would you like your pet to join you where you are interned or where your ashes are scattered?)
- A favorite animal charity or shelter(s) where you’ve adopted pets in the past that you would like to include in your estate plan.
Speaking of charities and nonprofits, have you been active with a local or national charity over the course of your life? Is there a charity for which you have a deep respect? Are non-profits a routine part of your annual donations and financial contributions? Your estate plan can set aside all or a portion of your assets to be distributed to favorite charities or non-profit organizations upon your death. Your estate planning attorney will help to explain which models of estate-related charitable giving make the most sense for the size of your estate and your future plans.
Visit our recent post, What is a Charitable Trust, to learn more about all of the ways your assets and financial investments can help those in need.
Estate plans are custom designed for each client. For some, a simple will may be enough. For others, the nature of their assets and investment lead to a wide range of options, including trusts.
Establishing a trust allows us to work creatively with your current assets, financial investments, and holdings, helping you to save money on court fees and protecting your heirs and beneficiaries from unnecessary taxes, fees, or penalties that may arise from an ill-prepared estate plan or a complete lack of estate-focused preparations.
You have the ability to establish:
- Trusts that payout annual incomes
- Accounts to fund niece/nephew college or learning funds
- Trusts that donate generated interests to charities and non-profits
- Funds to support your local schools, athletic, or creative arts programs
Estate planning is truly about so much more than “who gets what when you die.” It is a way to completely restructure how your assets and finances are working in the world today, tomorrow, and into the future.
Along those same lines, estate plans almost always include Advance Medical Directives and information about your Durable Power of Attorney(s), as well as other documents and instructions that determine who will take care of business if you are unable to do so.
While these key decisions are mostly in place to support your interests if you are rendered unconscious, experience a medical trauma, or develop a condition that results in cognitive impairment or the inability to communicate clearly. If and when you are rendered unable to make medical, financial, and legal decisions on your own, your estate plan will kick into gear, activating the trusted individuals you’ve outlined (as well as their backups), so decisions are made in accordance with your values, preferences, or predetermined instructions.
However, even without a medical emergency, unforeseen events are also potential estate plan activators. For example, at the beginning of the pandemic, we were called upon to serve several clients who were stuck overseas and unable to return safely home as a result of illness or quarantines and sheltering-in-place. This meant that their Power of Attorneys or designated representatives were called upon to do things like sign financial papers, pay bills, sign and complete school forms for their children, etc.
While having children may be the catalyst for individuals and couples to finally check “create an estate plan!” off their list of things to do, singletons and couples without children are equally well served by working with an experienced estate planning to get their legal and financial affairs in order.
Estate Planning Is Our Specialty
It’s all about being prepared for the future, and that motto is necessary for all – whether or not you have kids. Are you interested in learning more about how you can begin planning for the future? Schedule a consultation with the estate planning professionals at Tseng Law Firm.