Estate Planning Documents

The purpose of the various documents included in options one and two are as follows:

Revocable Living Trust: This is a separate legal entity created to avoid the costs and delays of probate. Your assets will be transferred into the name of your Trust and will be managed and controlled by you while you are still living. If you become incapacitated, your successor trustee will be able to manage trust assets for your benefit. At the end of your life your successor trustee will pass the trust assets directly to your heirs under the terms of the trust. You will have the ability to revoke or amend the trust at any time.

Certificate of Trust: This document provides banking institutions, brokerage firms, transfer agents or other third parties with all the information they need regarding the trust to manage trust assets. This preserves your privacy by allowing you to manage trust assets without having to give them copies of the entire trust.

Will: If you do not prepare a Revocable Living Trust, the Will provides for transfer of assets you own at the time of your death to your heirs. If you prepare a Revocable Living Trust, your Will assures that any assets that are outside of your trust upon your death are transferred to your trust so that assets can be distributed under the terms of your trust.

Springing Durable Power of Attorney for asset management: This document becomes effective if you become incapacitated. It gives your named agent the power to control and manage your financial assets. If you have a Revocable Living Trust, assets in the Trust will be managed by your successor trustee, but this will assure that outside of your Trust can be managed by your agent during any period of incapacity.

Advance Health Care Directive: This document allows you to specify agents to enforce your decisions regarding your health when you no longer have the capacity to make your own decisions.

HIPAA release: Under the Privacy Act of HIPAA laws, only your acting agent under the Advance Healthcare Directive will have access to your medical care information (and your spouse, if you are married). However, this document allows you to name individuals you would like to have permission to ask questions about your medical care.

Transfer-on-Death Deed: If you do not prepare a Revocable Living Trust, this is a tool that can be used to pass your home to heirs without having to go through a probate.

What Happens if I Have No Estate Plan?

If you do not set up an estate plan, California law will determine who inherits from you. This is referred to as “Intestate Succession.” Although the presumptions under California law are reasonable, if you have a blended family or a disabled child, the California presumptions could result in a disaster. Another problem with the California Intestate Succession is that it will generally require a probate to move the assets to your beneficiaries. Probate is expensive and time consuming.

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