Have you heard about the “Great Wealth Transfer?” It’s predicted that over the next couple of decades, $84 trillion will pass from the Baby Boomer generation to Gen X and millennials. This is an opportunity to build generational wealth that will provide financial security for years to come. Unfortunately, approximately 67% of American adults don’t have any estate plan. So, what will happen to all that money when they die?

California’s Intestate Succession Laws

First and foremost, California is a community property state. If you die without a will and are survived by your spouse, they will get 100% of the marital assets. In addition, California recognizes registered domestic partners who have the same inheritance rights as a spouse.

Separate assets acquired before the marriage or an inheritance are treated differently. The intestate succession laws break down as follows if you have:

• A spouse, no children, parents are deceased, and no siblings: Spouse inherits everything.
• A spouse and one child: The assets are split evenly between the two
• A spouse and more than one child: The spouse receives ⅓ of the separate property, and ⅔ is divided evenly among the children
• A spouse and parents of the deceased: The Spouse gets half, and the parents receive the other half. If the parents are no longer living, any siblings of the deceased will receive the other half to be divided evenly.

If you don’t have a spouse, everything will go to your children. If you don’t have any children, the line of succession will go through all living residents until the closest one is found, who will inherit everything.

This process can become costly and time-consuming. Furthermore, any verbal bequests you may have made while living won’t be recognized by the court after you die.

Beyond Asset Distribution

A will covers much more than who will receive your estate when you die. It encompasses several critical aspects of your personal and financial affairs, such as:

Appoint a Guardian for Minor Children

One of the most significant roles of a will is the ability to appoint a guardian for your minor children. You can designate someone you trust to take care of your children in the event of your untimely passing. You can ensure they are raised in a stable environment. If you don’t have a will, the court can decide upon guardianship for your children, which may be a person that doesn’t share your values.

Specify Funeral Arrangements

In your will, you can outline your wishes regarding funeral and burial arrangements. By specifying your final wishes, you relieve your loved ones of the burden of making these decisions during an emotional time.

Appoint an Executor

An executor is the person who oversees the handling of your estate. Their duties include petitioning the court to open probate, paying your debts and final expenses, and ensuring your beneficiaries receive their inheritance per your wishes. You can name a trusted individual as executor in your will and help ensure your estate is handled honestly and efficiently.

Minimize Family Disputes

Family arguments over inheritance can lead to long-lasting conflicts that may never fully resolve. Your will can help minimize misunderstandings and disputes among family members by clearly outlining how you want your assets distributed.

Finding Peace of Mind with LPEP Law

Ultimately, a will provides you and your loved ones peace of mind. Our lawyers at Lonich Patton Ehrlich Policastri have extensive experience in estate planning and can work with you to create a will that’s tailored to your specific needs. We will ensure your estate is handled according to your wishes. If your wishes change, we can help you with that as well.

Contact us for a free consultation by calling (408) 553-0801.

Disclaimer: this article does not constitute a guarantee, warranty, or prediction regarding the outcome of your legal matter. 

Estate planning is an essential strategy for protecting your assets and ensuring that your wealth is passed on to your loved ones. One of the significant concerns for many people is how to protect their assets from potential creditors. By creating a robust estate plan, you can safeguard your hard-earned property, savings, and investments from being seized to satisfy debts. Here’s what you need to know.

Why Protecting Your Assets from Creditors is Important

Creditors can pose a serious threat to your financial well-being, particularly if you face lawsuits, medical debt, or business liabilities. Without proper protection, your assets could be vulnerable to claims, jeopardizing your financial future and your family’s inheritance. Estate planning offers legal ways to shield your assets from such risks, allowing you to maintain control over your wealth.

Effective Estate Planning Strategies for Asset Protection

Let’s take a look at some of the estate planning strategies you can put in place to protect your assets from creditors. 

Create an Irrevocable Trust for Asset Protection from Creditors

One of the most effective ways to protect your assets from creditors is through an irrevocable trust. Unlike a revocable trust, where you maintain control over the assets, an irrevocable trust requires you to give up control of the property placed within it. Since the assets no longer legally belong to you, creditors cannot reach them. Irrevocable trusts are particularly useful in shielding high-value assets, such as real estate or substantial investments.

Establish a Family Limited Partnership (FLP)

A Family Limited Partnership (FLP) is another tool for protecting assets from creditors. In an FLP, family members own shares of the business, and these shares can be difficult for creditors to seize. While you may still control the partnership as a general partner, creditors can only access your personal interest, not the assets of the FLP itself. This type of arrangement is often used for family-owned businesses or investment portfolios.

Utilize Homestead Exemptions as a Strategy for Asset Protection

In the state of California, homeowners can take advantage of a legal provision known as the homestead exemption. This law provides protection for a certain amount of equity in one’s primary dwelling against claims from creditors. As of 2024, the protected equity value varies between $300,000 and $600,000, with the specific amount determined by the median home prices within the homeowner’s county of residence. Although this exemption doesn’t shield the entire value of a property, it does safeguard a considerable portion. This protection makes it substantially more challenging for creditors to compel the sale of a homeowner’s primary residence to satisfy debts.

Work with an Estate Planning Attorney at LPEP 

The laws governing asset protection and estate planning can be complex, particularly in California. It’s essential to work with an experienced estate planning attorney who understands the legal nuances and can help you implement the best strategies for your specific situation. 

Here at Lonich Patton Ehrlich Policastri, our experienced estate planning attorneys can help you with properly crafted trusts, partnerships, and legal documents to ensure your assets are protected and your legacy is preserved.

Protect your future and your family by taking the necessary steps today to shield your assets from creditors—contact LPEP today for a free consultation. 

Disclaimer: This article does not constitute a guarantee, warranty, or prediction regarding the outcome of your legal matter.