True or False? Only rich, elderly people need to have an estate plan.

It wouldn’t be a surprise if you chose ’True.’ After all, just the word ‘estate’ brings to mind large country manors with huge tracts of land. And that’s how the Oxford Dictionary defines it.

However, there’s another definition that refers to an estate as all the money and property owned by an individual. Therefore, if you have any assets, you should have an estate plan. 

But when should you create yours? That’s what we’re going to explore.

What’s in an Estate Plan

Everyone has different needs, and some estates may be more complex than others, especially if investments, real estate, retirement accounts, and luxury items exist. But some components should be included in every estate plan:

Last Will and Testament

68% of U.S. adults don’t have a will. They may assume that everything goes to their spouse or their children, but that’s not always the case. Instead, everything you own will be distributed according to California’s intestacy laws.

If you have a spouse and children, your spouse will get all the marital assets and half of any separate assets you may have. Your children will get the other half of the separate property. If you and your spouse don’t have children, then half of the separate property will go to your parents.

If you don’t have a spouse, everything goes to your children. The estate will go to your closest relatives if there is no surviving spouse or children. This has become such a common occurrence that it even has its own term: the laughing heir. Furthermore, without a will, certain sentimental items won’t get passed on to the people you wished to receive them. 

Even more important than material belongings, you can name a guardian for any minor children you may have in your will. Without that designation, the courts will decide your children’s care, and they may be raised by someone who doesn’t share your values.

Power of Attorney (POA)

If you were hospitalized due to an illness or injury and couldn’t communicate, who would take care of your financial affairs? How would your bills get paid? What if there were important investment decisions that needed to be made?

A power of attorney is a legal document that gives a trusted individual the authority to make financial decisions if you become incapacitated.

Healthcare Proxy and Advanced Directives

Just like a power of attorney handles your financial affairs during your incapacitation, a healthcare proxy handles the medical decisions. In addition, advanced directives outline what you want regarding end-of-life care.

Digital Estate Plan

We spend much of our time online. It’s crucial that you provide instructions on how to access your accounts, which should include:

URL
Username
Password
If it requires multi-authentication

You will also want to outline what you want done with your social media accounts, any domain names that you own, and pictures and documents stored in the cloud.

Estate Planning Help from LPEP Law

If you’re an adult, you need an estate plan, and the time to start is now. You may have been putting it off because it feels overwhelming. That’s where our lawyers at Lonich Patton Ehrlich Policastri can help. We have decades of combined experience and work with people throughout San Jose and the Greater Bay Area in creating tailor-made estate plans.

That’s because we understand everyone’s situation is unique. We will discuss your goals in making an estate plan, ensuring it is customized to your specific needs.

Contact us today to schedule your 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. 

Around the time we reach middle age, we start to form a picture of how we want our golden years to look. Most of us envision an active, healthy older person living their best life. Traveling the world, enjoying long walks with our partner, and spending time with our children and grandchildren checks all the boxes of a fulfilling second act.

To live the life you’re dreaming of requires only two things: health and wealth.

It’s within reach if you have the proper knowledge. Fortunately, you’ve come to the right place.

Defining Aging Well

By 2030, 20% of the United States population will be 65 and older. This will have a considerable impact on our society and economy. While progress is being made in the development of a national plan for aging, our country is lagging far behind other countries in creating strategies to meet the challenges and opportunities brought forth by a large older demographic. Therefore, it’s crucial that you have your own plan for healthy aging.

There is a misconception that growing older is synonymous with declining health. Preventative measures include staying active and socially engaged, a healthy diet, and regular health exams. 

It’s also essential to be prepared for potential hospital stays and the need for skilled care. Addressing gaps in healthcare and purchasing long-term care insurance can help ensure you receive quality care without draining your finances.

Laying the Legal Foundation for Protecting Your Assets

Creating an estate plan is the key to protecting your assets and preserving your legacy. In addition to a will that dictates the distribution of your assets to be distributed after you pass away, a well-crafted estate plan should include the following:

• Trusts offer you flexibility and control in managing your assets. This involves placing your assets into the care and management of a neutral party for the benefit of a third party. Trusts can help your estate to bypass the probate process. In addition, some trusts protect your assets from creditors and lawsuits.
• If you become incapacitated, a power of attorney allows a trusted individual to handle your financial affairs.
• Advanced directives dictate your preferences for end-of-life care and medical interventions.
• Healthcare proxies are trusted individuals who make medical decisions if you can not.
• Medicaid planning protects your assets while allowing you to qualify for benefits.

What is Elder Law?

Older adults have unique needs, and elder law focuses on the areas of estate planning and asset protection. The goal of elder law is to ensure financial stability as we age by addressing issues such as:

• Long-term care planning
• Asset protection
• Medicaid eligibility
• Protection from financial exploitation
• Aging with dignity

At Lonich Patton Ehrlich Policastri, we have the knowledge and experience to help you navigate the legal complexities related to aging. Our caring attorneys will work with you to provide strategies tailored to your individual needs.

Contact us at 408-553-0801 to schedule your free consultation and learn how we can create a plan that protects you and your assets.

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

Estate planning is one of the best ways to provide for your family when you are gone. When you have a disabled child, it’s even more important to have a plan in place before you actually need it since they will likely need ongoing assistance. While many people set up trusts to distribute funds to their children, your disabled child might benefit from a specific type of trust known as a special needs trust (SNT). The following guide goes over what you need to know about creating an SNT for a disabled child.

What Is a Special Needs Trust?

A special needs trust is a legal document that outlines your wishes for the distribution of funds from your estate to support your disabled child. Since many public benefits require the recipient to qualify as having low income or few assets, you don’t want to leave a large inheritance directly to your disabled child because those assets might disqualify them from receiving government benefits. An SNT protects them financially by distributing funds in a way that does not interfere with any government assistance the child might be eligible to receive. 

Funds in an SNT generally pay for expenses that would not otherwise be covered by public benefits, including:

• Education
• Clothing
• Food
• Vacations and travel
• Hobbies
• Entertainment
• Support services (e.g., a personal care attendant; Meals on Wheels, etc.)
• Certain therapies and out-of-pocket medical care

How to Set up a Special Needs Trust

There are several important steps to take when setting up an SNT.

Choose a Trustee

First, you want to designate a trustee who will be responsible for managing the assets on your child’s behalf. Some important considerations when choosing a trustee include that the person is trustworthy, is willing to serve in this capacity, is young and healthy enough to help your child long-term, has a good relationship with your child, and has the appropriate knowledge and ability to manage finances and comply with legal requirements.

Draft the Trust

Consult with an experienced estate planning attorney who specializes in special needs trusts to help you draft your document. Working with a professional will ensure that your trust is in compliance with relevant state and federal laws and will not interfere with government benefits like Medicaid or Supplemental Security Income. They can also assist you in assessing the future needs of your child and in clearly defining how the funds should be used.

Fund the Trust

After you have created the SNT, you can decide what assets you would like to fund it with, including cash, real estate, investments (including stocks and bonds), and other assets. On your life insurance policy, you can list the SNT as the beneficiary, so assets will transfer to the trust rather than directly to your child. You can also set up the fund so that other people, such as family members, can contribute as well. 

Want to Set Up a Special Needs Trust? We Can Help!

Establishing a special needs trust is a thoughtful step you can take to help safeguard the financial future of your special needs child. Our estate planning group at Lonich Patton Ehrlich Policastri has significant expertise in preparing estate planning documents, including SNTs. Contact us today to schedule your free consultation where we can discuss your unique situation and go over your options with you. 

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

Starting a new chapter as newlyweds is exciting, but it also comes with new responsibilities, especially when it comes to financial planning. One crucial yet often overlooked aspect is estate planning. 

Creating an estate plan not only protects your assets but also ensures that your spouse is taken care of should the unexpected happen. Here are some essential estate planning tips for newlyweds to help safeguard your financial future.

1. Create or Update Your Will

A will is an essential estate planning document that outlines how your assets will be allocated after you pass away. As newlyweds, you may want to leave your assets to your spouse or other family members, but without a will, state laws will determine how your estate is divided, which may not align with your wishes.

Steps to Take

• Draft a new will: If you’ve never created a will before, now is the time to do so.
• Update existing wills: If you already have a will, update it to reflect your new marital status and any joint assets you may have acquired.
• Name an executor: Choose someone you trust to ensure your wishes are carried out as outlined in your will.

2. Designate Beneficiaries

Your will doesn’t govern all of your assets. Some accounts, such as life insurance policies and retirement accounts (401(k), IRA), pass directly to the beneficiaries named on those accounts. As newlyweds, it’s essential to update these designations to ensure your spouse is the primary beneficiary.

Key Accounts to Update

• Life insurance policies
• Retirement accounts
• Pension plans
• Payable-on-death (POD) or transfer-on-death (TOD) bank accounts

By keeping these beneficiary designations current, you avoid potential delays or disputes in asset distribution.

3. Establish Joint Ownership of Assets

Many newlyweds combine their finances, and joint ownership of assets can simplify estate planning. Consider holding major assets like homes, vehicles, and bank accounts in joint tenancy with rights of survivorship. This ensures that if one spouse passes away, the other automatically inherits the asset without it going through probate.

Benefits of Joint Ownership

Assets held jointly can transfer directly to the surviving spouse without the lengthy probate process. It also makes managing and accessing your shared assets much easier during your marriage.

4. Set Up a Power of Attorney

A financial power of attorney allows your spouse (or another trusted person) to manage your financial affairs if you become incapacitated. Without this in place, your spouse may face legal hurdles to access your finances or pay bills on your behalf.

Medical Power of Attorney

Similarly, a medical power of attorney gives your spouse the authority to make healthcare decisions if you’re unable to do so. It ensures that your spouse can make critical decisions about your care during emergencies.

5. Consider a Living Trust

A living trust allows you to transfer assets to a trustee to manage for your benefit during your lifetime and for your beneficiaries after your death. It offers more control over asset distribution and can avoid the probate process altogether. Newlyweds with significant assets or complex financial situations might find that a living trust adds a layer of protection and flexibility.

Just Married? Start Estate Planning With LPEP!

Estate planning might not be the most romantic task on your newlywed to-do list, but it’s one of the most important. At LPEP, our experienced estate planning attorneys specialize in the preparation of estate planning documents, such as wills, revocable living trusts, and more.

Financial fitness for newlyweds isn’t just about managing day-to-day expenses; it’s about securing your future together. Contact LPEP to set up your free consultation. 

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

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.