Planning for the Future:
Imagine this scenario: You and your husband are out on a highly anticipated date night, having a blast. The babysitter is home with the kids, and has emergency phone numbers. On your way home, a drunk driver hits your vehicle and both you and your spouse are rushed to the hospital, unconscious. The babysitter will eventually call the Police when unable to reach you. Who takes the kids? If there is no plan in place, social services may become involved until a Court determines temporary guardianship. No one will have access to your bank accounts, but the bills will keep rolling in. By creating an Estate Plan, you can have a legally binding plan in place for your children and assets, and avoid court intervention.
Living Trusts: The only way to truly avoid Probate in California is to utilize a Living Trust. This is a highly customizable legal document which dictates exactly how, and to whom, your assets will be distributed. The Probate process lasts for at least one year and generally involves hefty attorney fees, which are determined by law as a percentage of the total estate assets. For example, a $500,000 estate will incur about $15,000 in probate attorney fees. Anyone who owns a house should seriously consider creating a Living Trust, it is much cheaper in the long run. Aside from avoiding the cost and time of probate, you can structure payments to be made in small increments, to avoid an inheritance being squandered by a beneficiary who is just bad with money, and condition those payments on pursuit of higher education or holding down a full time job.
Wills: If you die without a Will, the Court will distribute your assets based on California law; this is called Intestate Succession. If you had any minor children, and there is no other parent or legal guardian, it will be up to a Judge to decide who will care for those children. A Judge may think your sister is the best person, but will not take into regard religious beliefs or whether your sister will raise the children with your values. By putting together a Will, you can determine exactly where your property will be, and who will care for your children.
Powers of Attorney: In the event that you are in an accident and suddenly find yourself in a hospital, either in a coma or unable to communicate, who will make decisions on your behalf and what should those decisions be? How will the bills be paid, what kind of care will you want, and who will be your advocate? A Power of Attorney answers those questions, and ensures that your wishes will be followed. By completing a Power of Attorney, you can dictate who will make decisions on your behalf, express specific wishes for health care and finances, and avoid the need for a court order.
Estate Administration: When a person is appointed as a Trustee, Executor, or Administrator, there are certain duties they must fulfill. Some of these duties include: opening an estate bank account, filing estate tax returns, keeping records of all assets, and making distributions. These duties can be complicated and overwhelming, and Askov Estate Planning can help guide you in doing this job correctly.
Probate Process: Probate is a court process that distributes an individual’s assets after his or her death. Unlike other states, California does not follow the Uniform Probate Code and instead has its own probate laws. The process begins with filing a Petition with the Court and filing a will, if one exists. If there is no executor named due to there being no Will, a close family member may ask to be appointed as administrator. In California, Probate can take over a year to be completed, i.e. before any money is distributed. The attorney fees are set by state law, and are a percentage of the estate assets. This means that for anyone who owns a home, they are likely looking at $15,000 in attorney fees or more. Finally, Probate is public and requires a notice of the probate to be published in the local newspaper. This means unsolicited phone calls from real estate agents and bond services to the relative handling your probate; what a headache. For more information about the Probate process contact us for a free consultation.