Everyone has an estate that typically consists of your car, home, real estate, checking and saving accounts, investments, life insurance, furniture, and any other personal possessions. What happens to those items when you pass away? We’re assuming that you probably want to dictate how they are distributed to the people and organizations that you care about. That’s where an estate plan comes into play. This legal plan will list who you want to receive your assets, what they will receive, and when they will receive it. In essence, a good estate plan will guarantee that your wishes are carried out, which is just one reason why you should hire an estate planning attorney in San Diego.
A good estate plan will also include:
- Instructions for your care should you become disabled or incapacitated
- Naming of a guardian for minor children
- Plan for those special needs loved ones
- Protection for loved ones who need future protection from creditors or divorce
- Ways to minimize taxes, court costs, and unnecessary legal fees for loved ones
Who Should Have an Estate Plan?
Everyone. Contrary to popular belief, an estate plan isn’t just meant for people who are retired or elderly. We can’t predict how long we will live or if we’ll get an illness or have an accident; an estate plan will help protect you. In fact, we are living so long now, that most of us will experience an event of incapacity, even if it is temporary.
Furthermore, estate planning isn’t just for the wealthy. In fact, an estate plan can be more beneficial to those with modest assets. Estate planning for most families is really about protecting you in the event of incapacity and death, and planning for family dynamics.
Why Don’t People do Estate Planning?
Oftentimes people put off estate planning for a variety of reasons:
- They don’t think they have enough assets
- They don’t think they are old enough
- They’re too busy
- They think they have plenty of time left to plan
- The entire process is confusing and they don’t know who can help
- They don’t want to think about their death or incapacity
- They don’t even think about estate planning
Can I Write My Own Estate Plan?
Simply put, yes you can write some of your own legal documents that make up an estate plan. There are plenty of do-it-yourself templates and resources out there that will allow you to write them.
The question you really should be asking yourself is, should you write your own? Additionally, two more important questions to take into consideration are: will those do-it-yourself legal documents be valid? Will they hold up in court?
Hypothetically (and to put things into further perspective), with lots of research and study, you technically could perform oral surgery on yourself but should you do it? How well would it turn out?
7 Reasons to Hire an Estate Planning Attorney in San Diego
Meeting with a competent and well-versed estate planning lawyer will make sure that you and your family are well protected. This attorney can also help you with the following:
Reason #1: They Can Help to Avoid the Lengthy and Costly Probate Process
Probate is a court process for transferring a deceased person’s estate to the rightful heirs and beneficiaries. Going through this process is very expensive, can take up to two years, and is very public (anyone who is willing to go to the courthouse can receive copies of your Will and any other associated legal documents).
There is some relief when it comes to probate. Even if you don’t have a trust, this process isn’t always necessary. You can avoid probate when all of your assets are designated to beneficiaries.
Furthermore, if your estate is comprised of real property that is $50,000 or less and total property is $150,000 or less, a Small Estate Affidavit can be used to transfer assets to the legal heirs. If this route is taken, know that some entities may refuse it and force open probate or litigation. Relying on this means it’s also risky as it is literally a two page affidavit and sometimes entities don’t understand how they work and release funds to the wrong individual. Suing a bank to recover these assets often doesn’t make sense given the low value of the assets, the high cost of litigation, and the banks willingness to spend more fighting you than to settle.
As you can see, probate and all of the nuances associated with it are quite complicated. A good estate planning attorney in San Diego will be up-to-date on the probate process and can help assist your family should that need arise.
Reason #2: They Will Know The Best Way to Protect Yourself, Your Assets and Your Family
A good estate plan will include several documents that help ensure your loved ones won’t have to jump through hoops upon your passing. An estate plan can include:
- Will or Pourover Will
- Power of Attorney
- Medical directive
- General Assignment
- Guardianship Nomination
In these documents (among others), specific verbiage should be used to ensure that:
- Your assets will be given to the people that you care about the most. This can include setting up rules to have control over what and when a beneficiary receives their inheritance. For example, you can set up a trust for minor children to receive assets when they reach a certain age and dictate what the trustee can pay for on their behalf in the meantime.
- If you have kids, a Guardianship Nomination is the only evidence the court will have before them when you are gone, reflecting your wishes as to who takes care of your children. Remember, a Guardianship Nomination is just a nomination. The court will still do its own vetting before appointing that person.
The use of a wrong word or missing signature could be the reason that your family isn’t well protected after your passing. Meeting with an estate lawyer will help to ensure that all of the bases are covered, allowing you to have peace of mind.
Reason #3: An Estate Planning Attorney Can Save You Time and Energy, and Will Avoid Common Mistakes
Estate planning helps to organize all of your records and wishes. This will allow your family to easily find essential financial records, titles, insurance policies, and beneficiary designations upon your passing. Additionally, this planning process can help to find and resolve errors and mistakes while you are still alive to fix them.
One common mistake is made in the process of designating beneficiaries. For example, the tax impact of naming certain beneficiaries to receive your IRA or 401ks can be significant.
Other common mistakes an estate planning attorney can help you to avoid include:
- Not creating an estate plan
- Not completing the process
- Creating an inadequate estate plan
- Leaving certain assets or people out
- Not updating the estate plan when life changes occur
An estate planning attorney can also eliminate the strain on you by drafting up a complete estate plan, which can help to avoid paying more in professional fees, court costs, and taxes. The minute we have to go to court to try to fix your estate plan, any savings you received by doing your own estate plan or using an online service are lost, several times over.
Reason #4: They Will Create an Estate Plan that will Take Care of a Family Member(s) with Special Needs
For some, there might be special circumstances. For example, you might have a child with special needs whose public benefits will be lost if they inherit assets outright. Luckily, there are certain types of trusts that can be set up so those special needs loved ones can still receive government benefits while also receiving their inheritance.
However, setting up a special needs trust the right way is quite complicated and requires very specific knowledge and estate planning. An attorney who is well-versed in special needs trusts can help ensure that your loved one is protected and has the benefit of your legacy to supplement their public benefits which are never enough.
Reason #5: Estate Planning Lawyers Help You to Reduce Tax Liabilities
Determining whether your estate is liable for federal estate taxes depends on a variety of factors:
- Value of your gross estate
- Amount of debt you owe at the time of death
- Total expenses incurred while settling your estate
- Any deductions that your estate is eligible to take
From there you can calculate your net estate by taking the gross estate and subtracting debt and expenses, charitable donations, and any transfers to a spouse from a trust. Then you subtract your federal estate tax exemption from your net estate.
For example, if your gross estate is worth $8 million, and your debts and other deductions total $500,000, then your net estate is $7.5 million. If you haven’t made any taxable donations then you would just subtract the available estate tax exemption ($11.18 million for 2018).
$7,500,000 – $11,180,000 = ($3,680,000). This means your estate tax exemption is more than the value of your estate so no taxes would be owed.
That’s not always the case. If the net estate exceeds $11.18 million, the value over the exemption amount is taxed at 40%. While this only happens to a few individuals, the law surrounding federal and state estate taxes are complex. Working with an estate planning attorney can help ensure you know everything involved with these taxes so you can plan accordingly.
Reason #6: Your Estate Attorney Will Update Your Estate Planning Documents Whenever it’s Necessary
Life happens and circumstances or even your wishes can change. This could be due to a divorce, birth of a child, marriage, aging of named trustees, change in relationships or family dynamics – whenever there is a big life event, it’s important to update your estate plan so it continues to meet your wishes and your family’s needs.
Contacting the best estate planning attorneys in San Diego after a big life event will guarantee that all of your legal documents are updated and reflect your newest wishes and desires. Hiring an estate planning attorney in San Diego can truly be life-saving as they will help you to avoid costly mistakes, have extensive knowledge surrounding the estate planning process, and will serve as your advocate.
Reason #7: This Attorney Will Provide Objectivity
Estate planning can be an emotional process. Additionally, it can be hard to determine the best plan due to family dynamics. Estate planning lawyers bring an extra voice of reason to help you with current and future needs. They will be able to provide you with a direct and unbiased answer, which is something that can help to protect your family down the road.
What Happens if You Die Without an Estate Plan?
If there is no estate plan in place, the assets will be distributed by the probate laws in your state, through the court. This may or may not result in the distribution you would have chosen. I can’t tell you how often clients tell me that their parent or grandparent told them they wanted to have certain things. Unfortunately, if it isn’t written in a valid will or trust, it doesn’t matter. In addition, any minor children will have their inheritance controlled by the court until age 18 and then they will receive a lump sum outright, which they are unlikely to manage well. The California Probate Code is the best place to learn how your family will be affected without an estate plan in place.
An estate plan will give you the choice to keep your family affairs in order, private, and allow you to choose who will receive what and when. Start estate planning today, contact an estate planning attorney in San Diego for a free consultation.
How to Find the Best Estate Planning Attorney in San Diego
In finding the best attorney for your needs, it’s crucial that you find one that is knowledgeable. Estate planning lawyers that have represented clients in Wills and Trust litigation tend to draft better estate plans because they have seen them go wrong. In addition, a good lawyer will listen, ask the right questions, understand your situation, and craft the best estate plan to meet your needs.
Taking the time to research online through trusted sources such as The State Bar of California, read reviews, ask close family and friends for referrals, and interview a variety of different law firms will allow you to find the best attorney that fits your needs and that you trust. In that interview process, it’s also important to ask about their fee structure so you know how they are charging you and for what. The best estate planning attorney in San Diego will offer you the best advice without overcharging.
One of the most thoughtful and caring things you can do for yourself and loved ones is to properly prepare an estate plan that avoids court interventions, contains your last wishes, names individuals that get along with your family to manage your assets, and protects your family from high costs, taxes, and even their own irresponsibility or naivety. This will help to give you and your family members peace of mind.
It can be tough to find a good estate planning attorney that has experience both in the courtroom and drafting up the necessary documents for an accurate and thorough estate plan. Kam Law Firm has both. Plan ahead to protect yourself, your family, and legacy. Call (619) 535-1405 to talk with the estate planning attorneys at Kam Law Firm.