The decision to create an estate plan is among the most difficult and important choices a person can make. All good estate plans cover key life decisions such as what happens to your property, who cares for your children, and who manages your finances and health care choices when you are unable to do so yourself. Without the right legal documents, these important decisions are left in the hands of others. While there are a vast number of “cheaper” options on the market – online legal services, drafting software, and paralegal services, the decision is too important to leave in the hands of a novice. Would you want your loved ones making business succession plans in the midst of their grief and other financial concerns related to your sudden passing?
The risk of having an improperly-drafted estate plan can cost exponentially more than the reward involved in hiring one of these services at a discount, and the prudent decision is to get it done right the first time – to measure twice and cut once. Another reason to hire an attorney to assist with your estate plan is that your circumstances may change over time, and if retained, our office will check in every year (free of charge) to ensure that your estate plan still meets your goals and suits your needs.
Creating an Estate Plan
The first step in creating a comprehensive estate plan is usually to draft a will. In this document, you determine the course of action on a few basic, but crucial, decisions: who will receive your property? Who will care for your children? Who will ensure that your final wishes are carried out, including advanced healthcare directives? Without a will, the probate court may decide on these issues for you. The probate process can be incredibly expensive, time-consuming and stressful, and the process can be expedited considerably by created a well-drafted will.
California recognizes four types of wills:
- Holographic Wills
- Witnessed Wills
- Statutory Wills
- International Wills
The requirements for a valid will are created by the California Probate Code. A client using an attorney to assist with the estate plan will generally execute a Witnessed Will. The advantage of using a will is strictly economic: a will is less complicated and less expensive to draft than a trust, and it is easy to amend when circumstances change. The primary disadvantage of a will is that it may require formal probate administration through the court system. A probated will becomes a matter of public record – the terms of the will and the inventory of the estate assets will become publicly available information.
Estate Planning in California
California has adopted the Uniform International Wills Act, which provides for the creation of an International Will that will be valid in California regardless of the place the will was prepared, the location of the assets, or the testator’s residence or nationality. An International Will requires careful execution and, in many cases, cooperation with attorneys in foreign countries to ensure compliance with all relevant local laws.
A Statutory Will covers the bare minimum required by law to create a will in California. This type of will can be established by filling out a printed form available on the State Bar of California’s website. The statutory will has many limitations, and it cannot be used in conjunction with a trust. A statutory will should only be used if all other methods are too expensive, and even then we cannot recommend its use.
Another common strategy is to create a Pour-Over Will. This document works in conjunction with a Living Trust. Most of your substantial assets will be placed into a trust, and the pour-over will serves as a “catch-all” to ensure that nothing is left to chance (or the discretion of a probate judge). Any property that has not been transferred to a trust will become property of the trust by operation of the will. A pour-over will also provides an opportunity to appoint guardians for your children and name an executor to your estate without giving up the benefits of using a trust in your estate plan.