Your Estate Planning New Year’s Resolution

By David J. Barnier

You’ve spent the last month enduring the stress of finding those perfect gifts for your loved ones. Now it’s time to make sure that you and your loved ones are legally protected by your estate plan and are prepared to deal with life issues as conveniently and inexpensively as possible.

An estate plan serves many purposes. It authorizes a trusted family member or friend to handle your property and health care (pursuant to your written instructions) in the event you require such assistance due to disability. Using a living trust, it ensures that when you pass away, your family members and beneficiaries have a clearly stated plan for asset distribution, and also allows your family members to avoid the time delays and significantly increased expense of Probate Court.

If you do not have an estate plan or if your estate plan does not include a living trust, the beginning of 2008 is the time for you to set up your living trust, either individually or as a married couple. A small investment of time and money now will save your family members a far greater amount of time and money down the road.

If you have an estate plan and living trust, it should be reviewed by you periodically to ensure that your asset distribution terms reflect your current desires. You can do this yourself by referring to the distribution terms within your living trust. If you cannot understand these distribution terms on your own, they probably need to be clarified.

You also should review your trust and your power of attorney documents to confirm that your designated agents are accurate. Has your agent moved away? Have you recognized a better candidate to assist you and your estate?

If you are a married couple and have a living trust, the terms of the living trust may include “bypass trust” or “AB trust” terms that are no longer appropriate to you due to recently changed Federal Estate Tax laws or to change circumstances with your assets. If you are married and have inappropriate terms in your living trust, the surviving spouse may have limited access to half of your property after the first spouse passes away. Likewise, Estate Tax may be unnecessarily owed if your living trust terms are not customized for your asset situation.

It is also important to ensure that your assets have been transferred to your living trust, otherwise the whole purpose of the living trust is defeated, as probate will be necessary to transfer those assets not held within the living trust.

If in the past few years you have not added a medical records authorization under the Health Insurance Portability & Accountability Act (“HIPAA”), your family members may not have access to your health information in the event you are hospitalized.

You are not expected to understand your estate plan’s legal details. But you should feel comfortable that your current estate plan documents accomplish your goals and protect you and your family from unnecessary expenses and unnecessary delays.

I cannot recommend strongly enough that you take advantage of our firm’s offer to review and summarize your current estate plan and to confirm its appropriateness. If you make available to our firm copies of your estate plan documents, we will summarize the relevant terms of these documents for you and point out areas that may need attention. We will answer your questions by telephone, by email, or via an in-person meeting. In some cases, this process will serve to confirm the appropriateness of your existing estate plan documents, providing you with peace of mind. If areas are identified that may need attention, you will learn of these areas. Obviously, our firm is available to give attention as may be needed, but you are under no obligation to retain our firm to follow through with any recommended action plan.

If you do not have an estate plan set up, 2008 is your time to set up a plan that confirms terms for distribution of your assets, agents to act on your behalf if you cannot act, and ensures that your family members can avoid the time and monetary expense of Probate Court. I would enjoy the opportunity to meet with you or to talk with you by phone regarding the further benefits of an estate plan or to answer your questions, both simple and complex.

To take advantage of my offer to review your existing estate plan at no charge and/or to discuss with you the benefits of estate planning in general, you are encouraged to contact me by phone or email. Let’s head into 2008 knowing that your estate plan is effective for your intended goals.

On a side note, I encourage you to tune into “Senior Security” on KOGO 600 AM on Saturdays at 6:30 a.m. I regularly participate in studio on this show, which primarily emphasizes the Medi-Cal and public benefits planning of financial planning professional Carl Gehring.

I look forward to hearing from you. You may reach me on my direct line at 619-682-4842, or you may email me at djb@barkerolmsted.com.

This article is intended as a brief overview of the law and are not intended to substitute as legal advice. Any questions or concerns regarding any statute or case law should be addressed to a licensed attorney. Copyright © 2007 by Barker Olmsted & Barnier, APLC. All rights reserved.