Trusts and Estates
Comprehensive Estate Planning Is Critical
Thank you for visiting our page. Here’s the bottom line:
You NEED a Trust.
This is not a “well, I’ll get around to it and it will be ok” kind of a thing. You NEED one NOW.
Because, and this is the thing we all need to confront, at some point you will either die or be incapacitated. What we do not know is when one of these will happen or what kind of assets you will have at the time.
What we can also tell you is that if you do not have adequate estate planning, then your estate will process through the California Probate Code. Prior to covid, an estate going through Probate would take approximately 18 months to 2 years. That assumes a relatively straightforward estate with a will and no challengers to the will or any assets. But since March 2020, with covid slamming into our lives, we are seeing similar probate actions take as much as 2.5 years to 3.5 years. That is just unacceptable. Yet so many people unknowingly accept this simply through failing to plan.
That delay is not what you want in the event of your incapacitation or death, we can all agree on that. It will not help your family to have them waiting on assets to help them pay a mortgage, buy groceries, by school clothes, or pay for grief counseling. You also don’t need the government to take your assets, divvy them up between creditors (i.e. credit card companies, mechanics liens, etc.) and then hit your estate at maximum tax rates, only to give your family what is left over. Again, without planning, that’s exactly what you are agreeing to.
The Probate Code was never meant to be the end-all be-all for estate planning. It was meant to provide for only the bare minimum and it is packed with hurdles. Over time, thanks to certain influences, it has morphed into something that prioritizes creditors and tax revenue over family. It is not tailored to you, your family, or your family’s needs and goals. The Probate Code barely considers those needs and goals. Regardless of your politics, you do not want the government to decide what should happen to your home, your retirement funds, your cash. Most important, you don’t want the government to decide what happens to your kids.
But if you do nothing, then you are agreeing to have the government decide what to do your kids, your house, and your cash----after it has already allowed creditors and tax collectors to raid your assets.
The Solution: Trusts, Life Insurance, Financial Planning, and Tax Planning
Historically, trusts were reserved for families with significant wealth. While this is no longer true, that idea still lingers and it is long past that idea’s time to die. If you are in California (which we assume you are since we’re a California law firm) then you need a trust.
But in those olden-times, life insurance and financial planning was also reserved for the one-percenters in society. This is no longer true and both can be critically helpful. We cannot stress it enough: life/incapacity insurance is critically, super, very, hugely, immensely, highly, massively important. If you do nothing else after reading this, Go. Get. Life. Insurance. (Make sure you have a policy that covers incapacity).
But as you get life insurance, you’ll need to think about where that insurance goes and how it gets to your beneficiaries. We imagine that you do not want the money you’ve left behind to go to your kids’ future-ex spouses, or even worse, your spouse’s future ex-spouse (yes, this happens . . . a lot.) Instead, you want that insurance money to stay with your kids and with your spouse—regardless of what happens in the future. Only a specific kind of trust can make that happen.
There is no one-sized-fits-all trust that is effective. As much as we will rant to about how effective trusts are, not everything you own should be held in trust. Other things should be held in trust that you would never in a million years think to place in them. This is what we do. We can help you decide how you want to manage your assets in the best interests of your beneficiaries.
Contact us as soon as possible at either 619-550-9352 or Chris@OlsenLawAPC.com.