A common misconception about estate planning is that only married couples with children need to create an estate plan. Not true!
A person with assets who cares about their future financial and medical needs should have an estate plan. Even as a single person, or someone without children, you most likely have possessions that matter to you. Though you may not be concerned with your assets; without an estate plan, your assets are subject to California’s intestate succession rules in which a court will decide which relatives are the most deserving of your possessions. The court will not take into account what type of relationship you have with your parents, siblings, aunts, uncles, nieces, and nephews. A trust will ensure that your possessions go to the people you want and it will ensure you stay out of court. A trust also allows you include specific requests or conditions to make sure they are carried out.
An estate plan also allows you to plan for your future both medically and financially. A Power of Attorney allows you to appoint an individual as your agent to act on your behalf for financial obligations should you lose capacity while you are living. Your agent will be able to step in and pay your bills and manage your finances the way you want them handled. If you don’t appoint an individual as your agent, the court will appoint an individual that they think will act in your best interest and it may not be the person you would have chosen yourself. An Advance Medical Directive will allow you to appoint a person to make medical and end-of-life decisions for you should you be deemed incapacitated.
Without an estate plan, you have no control over your affairs when you’re hurt or incapacitated. The state could appoint a distant relative to oversee your finances if you’re in the hospital or distribute your possessions to relatives that you barely know or have an estranged relationship with.
Contact Celaya Law to discuss the steps in setting up your estate plan so that you are taken care of.
Going on a Summer Vacation? Pre-travel estate planning should be at the top of your to-do list! Here are 7 items that you will want to add to your checklist:
Living Revocable Trust
Make sure you have a Revocable Living Trust in place that appoints a person to settle your affairs, designates who will receive property and proceeds, and most importantly avoids probate.
Due to the HIPAA Privacy Rule, you will need to give consent for a friend or family member to receive medical information should anything happen to you.
Durable Power of Attorney
If you are unable to make financial decisions, you will want to appoint an agent to step in and make these decisions for you. This document covers everything from legal to financial claims.
Advance Healthcare Directive
In the event that you are not able to make medical decisions for yourself, you will want to appoint an agent who will make medical treatment decisions on your behalf.
Do you have children younger than 18? Make sure you appoint a guardian plus an alternate guardian if your first choice is not able to fulfill his/her duties.
If you haven’t update your Trust in years, it might not reflect your wishes about beneficiaries, especially if you are divorced.
Financial Login Information
Make sure someone you trust has login information for your financial and other online accounts. It is is important to record all logins, passwords, and other relevant information securely should something happen to you.
An estate planning attorney at Celaya Law can make sure you’ve got these and other documents in order before you take your new trip.
A durable power of attorney (DPOA) allows or authorizes another individual (your agent) to handle certain financial obligations on your behalf should you fall ill or become mentally incapacitated. The Durable power of attorney can ensure that financial and lifestyle matters are property managed so that it eliminates uncertainty, fighting, or confusion.
Should you become mentally incapacitated, your agent it able to handle the following transactions:
- Paying Bills
- Filing Tax Returns
- Buying and Selling Property and Other Assets
- Managing Bank Accounts and Investments
- Medi-Cal Planning
- Applying for Government Benefits
Though there are many online resources that offer a do-it-yourself power of attorney, it is best for an estate planning attorney to prepare the durable power of attorney so that there are no potential issues with the document. A simple error can result in the durable power of attorney being invalid. Contact Celaya Law to discuss your specific needs and wishes and our experienced attorneys can recommend documents that will work best for your particular situation.
Did you know that California is one of several states that allows residents to create a Pet Trust to ensure a pet is well cared for after their owner passes away?
If you are a pet owner and you consider your pet a member of your immediate family, it is important to understand how you can provide for your pet when you pass away.
In 1991, California enacted two additions to its Probate Code: Sections 15211 and 15212. Both sections allow pet owners to create special trusts for their pets. Specifically, Probate Code Section 15211 allows Californians to establish a special trust that ensures a pet receives the proper care for up to 21 years. Probate Code Section 15212 allows the creation of a trust that will offer lifelong care to an animal.
Some things to think about when creating a Pet Trust are as follows:
- Your Pet’s age and life expectancy
- Costs associated with feeding and properly caring for your pet
- Cost of veterinary care, medication, or surgery if ever needed
- Who you want to appoint as Trustee of the Pet Trust who will fulfill your wishes after your death and take care of your pet
Contact the experienced estate planning attorneys at Celaya Law to discuss setting up a Pet Trust for your beloved pet.
A pay on death (POD) account allows a person to pass money to family or loved ones without the necessity of probate when he or she dies. The issue with pay on death accounts is that there is no asset protection for the beneficiary. Meaning, if after the death of the owner, a beneficiary files for bankruptcy or has creditors after him/her, the beneficiary runs the risk of losing their POD inheritance because there is no protection. After the account is transferred to a beneficiary, the POD account is owned by the beneficiary and there is no legal protection. Thus, a creditor can garnish the account.
A living trust is a far mechanism to protect beneficiaries from creditors. A beneficiary should inherit an account through a trust, so that there is asset protection and his/her inheritance cannot be accessed by any potential creditor. Contact Celaya Law so our experienced attorneys can evaluate your assets and income to determine what is at risk of collection from a creditor. We can help develop a plan to protect your beneficiaries from losing their inheritance from potential creditors.
The timeframe after a family member dies, usually is confusing and traumatic with family members and friends having to act quickly in planning a funeral, paying bills, taking care of pets, etc. As the family members navigate through these tasks, they often realize they need access to important documents, like an estate plan that had been (hopefully) prepared by decedent before he/she died and often times these documents are located in a safe deposit box. The question arises, how does a person gain access to a safe deposit box after the person who owned it has died?
California Probate Code 331 controls access to a safe deposit box after the death of decedent. If the decedent owned the safe deposit box with a spouse or another person, then that person will have access to it. If the decedent was the only person on title to the box, then any person who has a key to the safe deposit box can access it as long as they provide the financial institution with the following:
- Proof of decedent’s death
- Proof of the identity of the person seeking access
A personal representative or successor trustee of the decedent’s estate shall also have access to the safe deposit box as long as they show the financial institution a copy of the estate planning document that reflects they are the executor/successor trustee of the estate.
Depending on the circumstances, a safe deposit box may or may not be the best place to store your originals of your estate planning documents, especially on the limitations that California places on access to safe deposit boxes after death.
There are many myths about living trusts that often float around; however, don’t be fooled! Here are the three common myths that we, as estate planning attorneys often hear:
“A Living Trust only benefits the beneficiaries named in the trust, and not the grantor”
A lot of times a living trust is created, to ensure that property goes to a person’s heirs after their death; however, a living trust also ensures that a person’s affairs are in order should he/she become incapacitated. With a living trust, a loved one can step in and handle your affairs very easily should you become incapacitated.
“Living Trusts are only for the wealthy”
This is one of the most common myths that people believe. Some people think you have to have a certain size estate in order to have a trust, others do not think they need a trust because they do not have “a ton of assets”. This is untrue! Many people with average incomes set up a trust to protect their assets for their loved ones. A lot of times a person’s largest assets is their home.
“A Living Trust Will Avoid Probate Entirely”
In order for a trust to work properly, the living trust needs to be “funded”, meaning the assets need to be re-titled in the name of the trust. If there are assets that are outside the trust, those will go through the grueling process of probate. This is one of the main reasons you want to hire an experienced estate planning attorney to assist you in setting up your living trust.
The topic of estate planning can be overwhelming and daunting; however, below are five important topics to help you begin the discussion with your family.
Execute a Living Trust:
In order to pass your assets to your loved ones and avoid probate after your death, a living trust needs to be set-up and executed. A living trust will lay out who is in charge of administering your estate (your successor trustee) and where your assets go after your death.
Take an Inventory of your Assets:
In order for a living trust to properly work and avoid probate, your assets need to be re-titled in the name of the trust. Taking an inventory of your assets from time to time will allow you to make sure that there are no assets that are accidentally left out of trust and keeps your affairs in order.
Execute a Power of Attorney:
While a trust will govern where your property goes after you pass away, a Power of Attorney is extremely important to ensure that in the event you lose capacity, your agent will step in and handle your financial obligations.
Execute an Advance Healthcare Directive:
In the event that you lose capacity, and you are not able to make medical decisions for yourself, your agent will step in and make those medical decisions for you. It is also important to discuss your health care decisions with your agent so that your agent understands your wishes in various situations.
Discuss the disposition of your final remains:
Though this is a difficult topic, it is important to note family and religious traditions for the disposition of your final remains. Do you want to be buried or cremated? Perhaps you want to donate your organs to science. You want to discuss this topic with your loved ones, so that your final wishes are carried out.
Though the above topics are difficult to discuss with your loved ones, when done over a period of time, it can be a straightforward and non-stressful process.
Did you miss the February 16, 2021 deadline to transfer a property to your children before Proposition 19 went into effect? Don’t fret! There are various Prop 19 strategies. One of the strategies is with a Family Property LLC, which still may help your children avoid reassessment of property (under Prop 19) when you pass away.
Because there was a small window to make the necessary changes/transfers of property to avoid reassessment prior to the deadline of February 16, 2021, more than likely there were errors that occurred. Creating a Family Property LLC can fix any errors that we made. Contact Celaya Law today to learn how a Family Property LLC can help you and your family avoid reassessment of property once you pass away.
Did you know that there is a way to protect your assets should you need skilled nursing/long-term care? There is no need to “spend down” your estate until you are within the $2,000 asset range. With the proper planning of an estate planning attorney, who specializes in Medi-Cal planning, you can protect your assets and still have the state pay for your care, with a small share of cost. Most people don’t know that certain property is classified as exempt property, which will not count when determining eligibility while non-exempt or countable assets will effect eligibility. There are also various asset transfer strategies that are crucial in getting qualified for Medi-Cal. Contact Celaya Law to learn more about how you can protect your assets and still qualify for Medi-Cal.