By Robert Chang, Esq
There are common reasons why people choose not to do proper estate planning with a will or trust. In no particular order of importance: thinking that there is not enough assets to be a problem, they don’t need tax avoidance or probate avoidance, they are not dying, they are not elderly, they already have a will, losing control of your property, paying for the cheapest service because they think it is one size fits all, and finally, thinking that it won’t matter once you’re dead what happens to your money.
First there are those who think that their estate would be too small to be important enough to administer, or consume resources. This is a lot less true than people think – in California, having more than $50,000 in real estate and $150,000 in total assets will put you at risk for larger expenditures than if you made the proper planning. Estate planning is not just for the rich – like taxes, failure to do your due diligence (or having someone do it for you) can cause you or your loved ones to experience more financial headaches than necessary.
Next people think that probate avoidance and tax avoidance are the main reasons for estate planning – in fact, the financial element is usually not as important for modest estates than peace of mind, and making sure your family knows what to do with your assets.
Estate planning finally does not need to be done when you are on your death bed – rather, the sooner it is done, the less the people who survive you have to deal with. If you choose to ignore it, your family will be forced to deal with it while they are grieving.
Estate planning is not just for the elderly – young people pass away too. Planning for your future is important and if you have a family or loved ones, planning for their future should be important to you as well.
Wills are insufficient to cover all the things that can occur. A will is a good place to start, but really most people need more than just a simple will. At the very least, consulting a professional regarding whether a will is sufficient can be a good use of your time.
Some people are worried about the lack of control they have once they transfer their assets to a living trust. In fact, a person with a living trust has just as much power over their assets as someone without a trust. In addition, there is the added benefit that your loved ones don’t have to go through the headache involved with probate.
Although holding assets jointly with another person can be a way to circumvent the estate planning process, one can sometimes be put in a bad position if that person becomes hostile, or the value of the property is too great and a gift tax is assessed. Again, an ounce of prevention is worth of cure, and consulting a professional before doing something like this is always a good idea.
Paying for the cheapest assistance can backfire. Oftentimes, you get what you pay for. Estate planning is not one size fits all. An experienced attorney can draft a trust or estate plan that is customized to your situation – otherwise, having just boiler plate language from someone without experience can cause greater harm.
Although estate planning can be done yourself, there are often moving pieces and one change can affect the whole picture – as a result, it is a good idea to consult someone who knows the big picture.
Finally, some people are not concerned about what happens to them when they are gone. However, there should be people in your life that you care about – it is like leaving your children at the bus stop without an umbrella or instructions when it is raining. You want to make sure that they get all the help they need, and a plan that makes the process easier. It may be the first time they are dealing with the issue of estate planning, or death – and you don’t want them to struggle through the legal process while processing an extremely emotional time.
Contact DP LEGAL SOLUTIONS for a comprehensive Living Trust Package or a Will Package to safeguard your family. Call us at 510.346.5686 to make an appointment or you can easily make appointment online HERE for convenience.