WHAT IS IT?

Think of an estate plan as an instruction manual for someone to carry out your wishes and distribute your assets. These legal documents will provide instrucments on what to do should you become disabled AND when you pass. Although each estate plan is different and created to meet the unique needs of each individual client, there are some common elements to them all:

WHAT’S INSIDE?

A. Living Trust
A living trust is kind of like a treasure chest: you put all your valuable posessions in there such as your money, stock portfolio, home and anything else you own. While you are alive and mentally stable, you hold the key to the paddlock and can take things in and out, put new things inside, or change the contents in any way. Should you become disabled or when you pass away, the chest contains a list of instructions on who gets the key (known as the “trustee”) and how that person should distribute the treasure chest’s contents. The trustee cannot change the contents of the treassure chest and can only follow the instructions you presented.

B. HealthCare Directive
No one likes to think of their own mental incapacity but with today’s longer lifespans, we all need to come to terms that we may one day not be capable of making medical decisions for ourselves. A HealthCare Directive allows you to appoint someone to make medical decisions in the event you are unable to do so. Not having a healthcare directive would not mean that you may continue to make decisions on your own behalf. Rather, the court would appoint someone and it may not be the person you want or trust…

C. Limited Durable Power of Attorney
Similar to the Healthcare Directive, a limited durable power of attorney allows you to appoint someone you trust to manage your assets should you become disabled. Again, if you don’t have one in place, a judge will appoint one for you.

D. Will
The instructions to your treasure chest can only be applied to things you’ve put inside it. This means that if you’ve forgotten to put your new vacation house inside, the trustee cannot follow your rules about how your assets will be divided. A will offers protection by “pouring over” anything that is outside of your trust INTO that treasure chest. If you have minor children, it also has instructions on who will be their guardian should something happen to you.

BUT THAT’S NOT ALL…..

The above is just a snapshot of how a properly drafted estate plan can offer certainty, clarity, and protection of your assets all while giving you full control today. A trust isn’t just for the rich anymore, it is a vehicle available for everyone to limit the time and expense of probate and offer peace of mind that your wishes will be followed.

Want more information on estate planning and how it fits into your daily life? Let’s Talk! Email your questions to jchatman@chatmanlawgroup.com or call me at (408)857-1216. Let’s work together on building YOUR treasure chest.

Need help protecting your or your children’s public benefits? Contact us today to find out what a Special Needs Trust or Pooled Trust can do for you!

What is Probate?

If you do not have a plan for your assets and those assets are worth more than $150,000 (think cars, home, brokerage accounts, etc) the state will provide one for you by the name of “Probate”. This means that your family will need to go to court and prove to a judge that they are entitled to the things you’ve left behind and the judge will dictate how those assets are distributed. Unfortunately, Probate is not a free service kindly provided by the state to help your family navigate these turbulent waters.  The assistance of a probate attorney will be needed and the court will appoint a personal representative who will also charge a fee, neither of which come cheap. The higher value of your estate, the higher fee the probate attorney and personal represntative charge for their services. Even if your estate is worth less than $150,000, Probate still occurs though the process and time is simplified. By way of example, a $200,000 estate would pay approximately $7,000 to the probate attorney and $7,000 to the personal representative. A $1,000,000 estate pays apprximately $23,000 to the probate attorney and an additional $23,000 to the personal representative. These fees don’t even include the filing fees and additional expenses of the court proceeding itself. THERE HAS TO BE A BETTER WAY!

Estate Planning 101

With the right tools, Probate can be avoided entirely and the automatic transfer of your assets to your family can be a reality. A Living Trust is just one of the valuable tools available in your estate planning arsenol allowing your hard earned assets to pass down to whomever you choose, and no one you don’t. The right estate planning enables you to control your assets exactly as you do today with little or no restrictions, protect your assets from creditors and preditors, and most importantly, allow peace of mind that your family won’t be burdened by the demands of Probate.

Many are wary of estate planning due to fears of high costs or the misguided thinking that trust planning is just a government loophole. Would you rather have your assets pay for probate after you pass, taking valuable time and money from the hands of your loved ones, or plan for your estate today for a fraction of the cost of probate? And as far as loopholes go, trust planning has been around since the 1700’s and has no indications of going away any time soon.

When to Start

No one likes to think of their own mortality and many avoid estate planning altogether due to this fear. However, even the advancement of medicine and increased longevity has not changed the innevitable. Plan for tomorrow today! Don’t wait for your family to be caught off-guard and unprepared when death strikes. You can change your estate plan at any time for any reason so why wait? Give yourself and your family peace of mind. Don’t let your hard earned assets go to court and administration fees instead of your loved ones.

Get Help!

Chatman Law Office will guide you through the maze of estate law and craft a plan to suit your unique needs. Contact us for more information (408)857-1217. Just as you wouldn’t trust your doctor to repair your car engine, don’t trust your assets to a DIY Estate Plan. Always seek the advice of a legal professional specializing in estate planning.