Questions About Estate Planning  

Q. What is estate planning?

A. It is a procedure that determines how someone's assets, also known as their estate, will be distributed after that person dies. It might be as simple as signing a will, or it might be more complicated with living trusts, charitable remainder trusts, life insurance trusts, and other methods of avoiding probate and reducing taxes after death.

Q.  Why should I do any estate planning?

A.  If you don't have an estate plan, the State of California has one for you, through a process known as intestate succession.  In other words, there are state laws that determine who will receive your estate, even if you would have never given anything to that person.  Using a will and/or trust will ensure that you, and not someone else, makes the decisions about your estate.

Q.  All I want is a simple will.  Why should I get involved with estate planning?

A.  If the value of your total estate is less than $150,000, you might need only a will because your estate is too small to be probated.  But you also might want to consider an advance health care directive and a power of attorney, both of which can make things easier for your family after your death. 

If your estate is greater than $150,000, having an estate plan can help your estate avoid probate and federal estate taxes.  A simple will does not avoid probate, and won't help to reduce federal estate taxes.

Q. How much will an estate plan cost?

A. That depends on where you live and how complicated your estate plan will be.  Also, some attorneys charge a flat fee for an estate plan and some charge on an hourly basis. Before hiring an attorney you should determine how fees will be determined and approximately how much will be charged.

 

Q. Why should I have an attorney draw up my estate plan when I can have a paralegal or a typing service do it cheaper?

A. The initial cost should not be the only consideration because a poorly prepared estate plan may eventually prove to be much more costly than a properly prepared estate plan. Problems with the estate plan may not become apparent until after the person who signed the estate plan has died. At that point it may be too late to correct the problems and the result could be extended and costly litigation.



It is also a violation of state law for paralegals or other non-lawyers to give legal advice. Due to the complexity of a will or trust, questions are bound to arise about the meaning of various parts of the document. Non-lawyers who attempt to answer these questions are breaking the law and could be providing inaccurate information.

Q.  I saw an ad for a living trust seminar that says that amendments will be made to the trust during the lifetime of the client at no charge.  How can they do that?

A.  In some cases the real purpose of the seminar is not to sell you a trust, but to sell you an annuity, which results in substantial commissions to the person selling the annuity.  The cost of the future amendments is minor, compared to the commissions, and also gives them the opportunity to sell you more annuities.  However, in some cases the promise of free amendments is an illusion because the attorney or business involved doesn't intend to provide anything for free.  And that's assuming that you can ever find them again to discuss the matter.  More information is available on these pages:  Scams and Annuities

Q. I brought my mother and father to see an attorney about a trust, but the attorney wouldn't allow me to sit in on the meeting. Why not?

A. The only clients in this case are your mother and father and the attorney should be working only with the clients. To do otherwise creates problems with attorney-client confidentiality, potential conflicts of interest, and could raise questions about the validity of the estate plan. If a beneficiary is involved with the planning of the will or trust, a presumption of undue influence can arise. Undue influence means that one person has been influenced by another to prepare or change an estate plan in a manner that person would not have chosen if there had been no undue influence. An example might be parents who leave everything to one child and nothing to their other children because the child who benefited from the estate plan convinced his parents that he should be favored by them.

Q. How often does an estate plan need to be reviewed after it is signed?

A. Clients should look at their estate plans once a year to determine if the distribution plan still fits their needs, if the executors and trustees are still willing and able to serve, or if other details are up to date and still meet the clients' needs. 

Q. I have estate planning software that produces a will that will require notarization. What does this mean?

A. Some software is drawn up for use in all 50 states, but does not take into consideration the differences in laws in various states. In some states notarization is a valid means of witnessing a will. In California, however, notarization of a will is not allowed as a substitution for the two witnesses required by state law.  A notarized will won't be admitted to probate because it does not have two witnesses.