What is an Estate?
When most people hear the word “estate,” they associate that word with having a lot of money. But “estate” is really just a fancy word that means all your stuff. If you are reading this page on a phone, tablet, or computer that is yours, guess what? You have stuff, and therefore you have an estate! Your estate includes not only your finances, but anything that you own or control, in whole or in part. However, estate planning is about so much more than just your stuff...
What is Estate Planning?
Estate planning is all about stewardship, not just of your stuff, but of your family and loved ones. It is about putting a plan in place to take care of yourself and the ones you love most in the way that you would take care of them yourself if you were able and available to do it.
What is an Estate Plan?
An “estate plan” is a set of legally-enforceable instructions that you create for others so that they know what you want them to do, and they have the legal authority to do it, both during your lifetime (whenever you're not able or available to make decisions for yourself) and after your death.
What is the difference between Estate Planning and Financial Planning?
Financial Planning is about ensuring that your estate is sufficient to support your and your family's needs and goals during your lifetime and beyond. This typically involves budgeting, investments, and insurance, and is best handled with an experienced financial planner.
Estate Planning is about establishing how your estate is held and distributed and who gets to make decisions for you and your family, both during your lifetime and after your death. This is best handled with an experienced estate planning attorney.
Why is it so important to have an estate plan?
Most people think that the main reasons to have an estate plan are avoiding taxes, avoiding probate, or protecting their assets from someone else taking them. Those can all be very good reasons, but an often overlooked reason may be the most important one of all: Having an estate plan means that you and people that you choose get to make decisions for you and your family, rather than the government, the court system, or opportunists who would take advantage of you and your family.
Do I need a will or a living trust?
A living trust is often the best choice for estate planning in California, but not always. In some cases, a will-based estate plan might be better for your situation. A well-crafted estate plan that is based on a will can get you to the same end-result as a well-crafted estate plan that is based on a living trust, and vice versa. The main difference is that a will goes through probate, but there are several other key differences. To learn more about which is right for you, we encourage you to attend our Estate Planning Foundations class.
What is probate, and should I avoid it?
Probate is the court-supervised administration and disposition of your finances and belongings after your death. In California, most people prefer to avoid probate because it is public and time consuming and can be very expensive. However, there are benefits to probate in certain situations. To learn more about the drawbacks and benefits of probate, we encourage you to attend our Estate Planning Foundations class.
I have joint accounts, beneficiary designations, a TOD deed on my house, and advance directives. Isn't that enough?
Maybe. But this type of planning depends on everything working exactly the way that you hope it will. By the time something doesn't work as planned, it is usually too late to make a change. To learn more about what can go wrong with this type of overly-simplified planning, we encourage you to attend our Estate Planning Foundations class.
I've been to estate planning seminars before. Are you just going to try to sell me a trust?
No. With Twain Harte Law, a trust-based plan doesn't cost any more than a will-based plan, so there is no financial incentive for us to push one type of plan over another. Estate Planning Foundations is not a sales seminar. It is a one-time, two-hour class we offer to familiarize you with basic estate planning concepts and demystify the estate planning process so that when we meet to discuss your individual situation and goals, you will have a comfortable familiarity with how the various components of an estate plan work.
Ready to learn more?
Sign up here for the next Estate Planning Foundations class!
