Get a Fresh Start to a New Year

By Debbie B. Jones, Esq.

January 16, 2024

January is a good time to check your financial situation. Make sure all of your investment accounts, 401ks, IRAs and Life Insurance policies have designated beneficiaries. It is also a good time to create your Estate Plan or review your existing Estate Plan with an Estate Planning professional.

What is an Estate Plan?

An Estate Plan provides all of the legal documents necessary to manage your estate while you are still alive, and to assist your loved ones with the transfer of your estate after your death. These documents include:

Revocable Trust

A properly funded revocable trust allows you to transfer your assets, including real property, to your chosen beneficiaries without going through the probate process. The probate process can take 18 months to several years to complete and the statutory compensation paid to the administrator and the attorney can cost several thousand dollars. For example, the probate of a $500,000 estate would cost $13,000 in statutory fees for both the administrator and the attorney, a total of $26,000. The flat fee cost of an Estate Plan for a couple is $3,000.

Pour-over Will

When a revocable trust has been created, it is essential to include a Pour-over Will. “Pour-over” describes a testamentary transfer of the decedent’s nontrust assets to the trustee of a revocable trust that becomes irrevocable on the Trustor’s death.

Certification of Trust

The Certification sets forth the existence of the Trust and identifies the Trustees that will manage any account or asset held in the Trust. The Certification acts as a short version of the Trust Agreement and gives any third party all the information required from the Trust without getting into the dispositive provisions, which are (and should remain) confidential.

Durable Power of Attorney for Estate Management

The Durable Power of Attorney for Estate Management will grant the designated Agent authority to manage personal estate (non-Trust) property during any periods of time when the grantor is incapacitated because of illness or any other reason. This authority only exists while the grantor is alive and requires the determination of two medical doctors as to incapacity.

Advanced Health Care Directive

The Advanced Health Care Directive grants a designated Agent authority to make health care decisions for the grantor during any periods of time when the grantor is incapacitated because of illness or any other reason. This authority requires the determination of two medical doctors as to incapacity.

Who needs an Estate Plan?

Anyone with assets valued over $184,500 should have an estate plan, because that is the value that will require a Probate if you do not have a revocable trust. If you own a home in California you should have an estate plan with a revocable trust. If you are a parent of young children, you should have an estate plan so that you can identify the guardians for your minor children should something happen to you.

If you have questions regarding your current Estate Plan or if you are considering creating your Estate Plan be sure to contact BPE Law Group and discuss with our Estate Planning professionals. BPE is currently offering a free consultation to new estate planning clients.

The information presented in this Article is not to be taken as legal advice. Every person’s situation is different. If you have received a letter threatening legal action or are facing a legal issue of any kind, get competent legal advice in your state immediately so that you can determine your best options.

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