Reasons to Avoid Probate #1

If you are reading this post, I hope it is because you are interested in estate planning and that you have both the time and ability to complete your estate plan. Much of the heartbreak in the type of law this office practices, is the result of people failing to plan ahead of time and leaving families and loved ones to deal with the California probate process. Over the next several blog posts, I want to highlight a specific reason why you should be interested in avoiding probate and how this office can help you do so.

Probate Overview - In California, probate is a court process whereby the court determines what you own (assets), what you owe to others (debts) and who receives your assets after debts are paid (heirs). In 2023, if an individual passes away with assets in their own individual name exceeding $185,000, that individual’s estate will be subject to probate. As an example, if a single person passes away and owns their primary residence (not in a trust and not jointly owned with another person), valued at $650,000, that deceased individual’s estate will be subject to probate because it is over the probate limit.

REASON TO AVOID PROBATE #1 - COST

The #1 complain of clients facing the probate process is the cost involved. There are several costs involved before completion of a probate:

  • Filing Fees - Initial Filing fees, filing fees through the course of the probate process and the filing fees for final distribution of the estate can cost over $1,000

  • Newspaper Publication and Notice of Death - Depending on where the deceased individual resided, local newspaper publication can cost anywhere between $500-$1,500

  • Probate Referee Fees - The probate referee charged with appraising the value of the estate assets is paid for their services as a percentage of the estate value - From low hundred dollars to $1,000+ depending on estate value

  • Attorney Fees - Attorneys are paid on a statutory rate - 4% of the first $100,000 of estate value ($4,000), 3% of the next $100,000 of estate value ($3,000) and 2% of the next $800,000 of estate value. Thus, even the most minimal probate estate would incur attorney fees upwards of $6,000. Additionally, if the probate involves extraordinary work on behalf of the attorney, the attorney is allowed to request additional compensation.

  • Executor/Administrator Fees - If the Executor or Administrator so chooses, they can also receive compensation for their services, in the same amount as the compensation taken by the attorney.

HOW TO AVOID COSTS:

  • Avoid probate altogether by establishing, and maintaining, an estate plan prior to death

  • The Law Office of Heather Miller offers complimentary consultations (30 min.)

  • Call or email the office to setup a time (in person, phone call or zoom call) to discuss estate planning, avoiding probate, options available to you and pricing. We are happy to help.

  • Our goal is to assist as many people as possible setup thorough estate planning and avoid probate

Time to Plan for a New Year

It’s 2023! For many people, the start of a new year involves goal, plans and intentions. For the vast majority of Californians, their new year’s goals should include setting up an estate plan, reviewing an existing estate plan or revising an existing estate plan. Given the state of the economy and the uncertainty of the last few years, to ensure that your hard-earned money and assets are passed down to your loved ones in the easiest, most cost effective and stress-free way you should consider establishing a comprehensive estate plan. A comprehensive estate plan helps clients with the following:

  • avoiding probate

  • avoiding conservatorships

  • federal estate tax issues

  • ensures your assets go to those individuals that you choose, under the terms that you set

  • provides an opportunity to evaluate your current financial situation and make changes as necessary

  • maintains privacy for the client (vs. court proceedings which are public)

  • establishes a relationship with an attorney who personally knows the client’s history, finances and documents and who is available to assist in the administration of the trust and estate documents in the future

The Law Office of Heather Miller offers complimentary consultations (30 min.) for new clients wishing to setup, or amend, estate planning documents. The Law Office of Heather Miller offers complimentary notarization of estate planning documents prepared by the Firm and has reasonable flat and hourly rates for Southern California. Please give us a call at (424) 571-2614 or email heathermillerlaw@gmail.com to discuss. We offer phone, zoom and in person meetings. We look forward to speak with you!

Funding Your Living Trust

One of the most common mistakes people make after completing their living trust is failing to appropriately retitle their bank and financial accounts in the name of their living trust. While the creation of your living trust is vastly important, we can’t stress enough the importance of taking the further step of placing title to assets into the trust. Changing title to assets will help to effectuate your intention of your assets being passed at your death to your named beneficiaries through your trust, all while avoiding probate.

Assets that may need to be retitled to the name of your living trust:

  • Checking Accounts

  • Savings Accounts

  • Certificate of Deposit

  • Money Market Accounts

  • Stocks

  • Bonds

  • Investment/Brokerage Accounts (non-qualified)

  • Real Estate

  • Business Interests

If you have previously created a living trust but you have not changed title to your accounts, or you are unsure or just feel overwhelmed by the process, schedule an appointment with the Law Office of Heather Miller. Bring in a copy of your trust, a list of your assets, statements for your accounts and let’s sit down together to ensure you have everything properly titled so you can rest assured your loved ones will avoid the probate process. Meetings for assistance with retitling assets are billed at an hourly rate.

Common Misconceptions About Estate Planning

Unclear on what estate planning is, when you need estate planning or the benefits of estate planning for you and your family?  Below are some common misconceptions about estate planning that I hope to resolve when meeting with a potential client for a consultation.

  • Estate planning is just for the wealthy
  • Estate planning is only for the elderly
  • Estate planning is costly
  • Estate planning is not necessary if you don't own real estate or have kids
  • Estate plans never need to be amended
  • It is easier to let your loved ones deal with probate instead of planning in advance 
  • You are married so you don't need to nominate anyone to act for you in the event of incapacity
  • Your wishes regarding health care decisions are known by your family so they don't need to be written down
  • There are ways to leave real property to beneficiaries without having a living trust

During a complimentary in person consultation, I like to discuss a perspective client's particular situation and clear up any confusion regarding any, and all, of these common estate planning misconceptions.  My goal is to give a perspective client an outline for what they need, always tailored to their situation, and the knowledge of why estate planning is important.  

Please email us at heathermillerlaw@gmail.com or call (424) 571-2614 to schedule a complimentary consultation.  I look forward to meeting with you in my convenient Torrance, CA office. 

Correctly Plan For Incapacity

Did you know each estate planning document serves a different purpose?  While an attorney may draw up multiple documents for you, they all contain different language and serve different purposes. 

Recently, I saw a will that included incapacity provisions.  A will is not the correct place for incapacity provisions. Here's why:  If you are incapacitated you are still alive.  Incapacity provisions need to be included in a document that is effective while you are living.  A will is only effective after you pass away. Thus, if your incapacity provisions are in a will they have no effect and don't serve any purpose. 

Instead,  make sure you have stand alone documents (a durable power of attorney, an advanced health care directive, and a hipaa form) that provide access and information to your loved ones in the event of incapacitation.

Review your documents every one to two years.  If you have any concerns that your documents might need revision to adequately protect you, give the Law Office of Heather Miller a call.  We would love to sit down with you, review your documents and give you peace of mind.

 

Plan Now, Not Later

3 months into 2015... already.  If your New Year's Resolutions or list of to-dos for 2015 included creating an estate plan, now is the perfect time.  As an attorney, I'm often asked why it is important to create an estate plan.  Unfortunately, many people have misconceptions about estate planning and believe they don't own enough so they don't need to plan.  However, almost all Californians need some sort of estate plan.  Estate planning is important for those with $100,000 in assets just as much as it is for those with million dollar estates.  Additionally, estate planning isn't just about money - everyone can use a Power of Attorney, a Health Care Directive and a few other disability planning documents.  My goal is to help you determine what exactly you need, whether it be simple or complex.  Below are my top 5 reasons to create an estate plan: 

TOP 5 REASONS TO CREATE AN ESTATE PLAN

1. You own a home - California real estate is expensive.  Even if this your only large asset, it is enough in and of itself to create a probate issue

2. You have children - If you have minor children you need to nominate a guardian for them if something should happen to you and/or your spouse.  If you want to leave money to a child you likely want to state at what age they can receive an inheritance and for what purpose the money can be used for. Don't leave it up to the state - if you don't plan money left to a minor child goes into a custodial account which they will receive in full at 18 years of age

3. Privacy - Probate is a public proceeding, meaning anyone can view probate records.  Creating a living trust avoids court involvement and prying eyes

4. Cost - While many people struggle parting with money for an estate plan, the cost of a full customizable, comprehensive estate plan is significantly less than letting your estate go to probate. I'll be posting a blog post soon regarding the difference in cost of an estate plan versus probate

5. Disability planning - Everyone, regardless of gender, ethnicity, financial status, etc, needs to create a Power of Attorney, Advanced Health Care Directive and HIPAA form.  These documents allow agents to act for you when you are unable to do so.  Failing to create documents while you still have capacity will cause your loved ones to endure unnecessary, and costly, fees and time delays to set up a conservatorship - and the person nominated to care and act for you might not be the person you want

Don't plan for yourself.  Plan for your loved ones and the issues they will have to deal with if you don't plan.

If you are interested in more information, contact the Law Office of Heather Miller.  Consultations are always free and we would love to speak with you and educate you on estate planning and the appropriate plan for you and your family.