Why should every Californian have an estate plan?
Often viewed as a tool only important for the elderly or wealthy, people of all ages may benefit from creating an estate plan.
Many younger people in California, and elsewhere view estate planning as a step that is only really necessary for the elderly or the very wealthy. Even as they age, many adults continue to put off this type of preparation. However, there are benefits to creating an estate plan, which make it important for people of all ages.
What is included in an estate plan?
Estate plans can be as detailed or as basic as people want or need. Through these plans, people are able to specify how they want their affairs handled, and by whom, if they are unable to care or decide for themselves. Depending on the circumstances, most estate plans include wills, revocable living trusts, powers of attorney and medical directives.
Preserving and passing on assets
Regardless of the worth of the assets that people leave behind, most of their estates have to go through the probate process after their deaths. Planning ahead may help simplify the process and ensure people’s final wishes are carried out. In their estate plan documents, adults name executors to manage the distribution of their assets and the payment of their final debts. The Judicial Branch of California points out that without a will, the court will appoint an outside administrator to act as the deceased’s personal representative. Consequently, a stranger may be left to decide how to handle a person’s affairs.
Through a will, people are able to dictate who should inherit what. Contrary to the commonly held belief, the estates of the decedents do not automatically go to the state if they do not have a will. However, there is no way to guarantee that their assets will be passed on to their intended heirs. People may use wills, revocable living trusts and other legal methods in order to specify how they want their estates distributed to their beneficiaries, and to help avoid potentially burdensome estate taxes.
Preparing for incapacitation
A genetic condition or life-threatening illness or injury, among other factors, may leave people temporarily or permanently unable to care and make decisions for themselves. Unfortunately, this may affect people at any age. For this reason, durable powers of attorney and medical directives are commonly included elements in most estate plans. These documents may help ensure that people are protected in the event of a debilitating injury or illness.
According to The State Bar of California, a durable power of attorney is a document that states in effect through a person’s incapacitation. This type of document grants a specified person the authority to act on the disabled person’s behalf. Similarly, advance health care directives are legal documents that bestow decision-making authority regarding health care-related matters to a specified representative.
Working with an attorney
Not wanting to think about their own mortality, many Californians put off important end-of-life planning. However, not creating an estate plan could leave complicated issues for people’s loved ones to deal with after their passing or affect who the care they receive if they are unable to take care of themselves. Therefore, it may be of benefit for people of all ages to discuss their legal needs with a legal professional. A lawyer may explain their options and help them develop a plan that is based on their unique circumstances and needs.