You’ve worked hard to create a wonderful life for you and your family. But have you ever wondered what would happen to your family, home and other assets if tragedy should strike? While death and medical emergencies are subjects most people would rather not contemplate, the fact remains that unfortunate unexpected events can happen. The smart and savvy among us know the importance of being prepared for anything life (or death) may deliver. Here, estate planning attorney Joe Engle shares how you can protect your family and preserve your assets under any circumstances with a little foresight and planning.
Q. What are the most important estate-planning documents?
A. There are five main documents:
- 1. Living Trust
- 2. Will
- 3. Power of Attorney
- 4. Advanced Health Care Directive
- 5. HIPAA Release Form
Q. What is a Living Trust?
A. A Living Trust is a written document detailing a plan for how your money and assets are managed (and who manages them) when you can’t make those decisions yourself due to death or medical emergency.
Q. What are the main advantages of setting up a Living Trust?
A. Besides the obvious advantages of having a plan in place for dealing with your assets in your absence, a Living Trust can arrange for taking care of the kids, for example, by controlling financial distributions to your children, thus making a very difficult situation a little bit easier. In addition, a Living Trust will keep your estate out of the dreaded probate court.
Q. Can you explain a little about the role of probate court and why people choose to avoid it?
A. In the absence of a trust, in the event of your death, your assets may end up in probate. Probate is a costly judicial proceeding during which your assets are frozen until the proceeding concludes, which takes an average of one year. Proceedings can easily take much longer if any objections or complications arise.
Q. Is estate planning a costly process?
A. Costs vary, with the average area resident spending about $2,500 to set up the necessary documents to protect their estate, family and assets. Compare that to a year in probate court, where statutory and attorney fees cost upwards of $23,000!
Q. Who makes a good trustee for a Living Trust?
A. The trustee does not have to be a family member. While it’s often a spouse, in the event both mother and father are gone, a trustee can be a trusted family member who has some financial background, or even a professional trust administrator at a financial institution. Also, a trustee may not necessarily be the same person as a guardian appointed in a will.
To learn more about estate planning and to set up a complimentary one-hour consultation, contact Joe Engle, Attorney at Law, specializing in Estate Planning, Wills and Trusts at 805.297.8121. His offices are located at 2625 Townsgate Road, #330 in Westlake Village.