Your Time Is Valuable. Don’t Put off the Estate Planning Process

Gabriel Katzner - July 6, 2020 - Estate Planning
San Diego Estate Planning Attorney
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If you’re a nurse, doctor, or frontline healthcare worker, you tirelessly care for others and may not have a lot of free time to work on your estate planning. But if you can answer the following questions or at least think them through, you can get a jump start on the estate planning process today.

 

 

  • Who should handle your financial affairs?

 

Someone will need to make decisions and handle your affairs if you can’t do it yourself, and this will need to happen while you are alive and also after your death. The person you put in charge of your money and property should be trustworthy, detail-oriented, savvy with their own money, and good at record keeping. You may decide to appoint someone to serve as your agent under a financial power of attorney and/or a successor trustee of your revocable living trust.

 

The agent will carry out the financial transactions listed in the financial power of attorney while you are alive. The document can be tailored to meet your needs, and you can grant your agent as much or as little authority as you choose. You can give them the authority to do everything you could do (referred to as a general durable power of attorney), or the agent could be instructed to only open a bank account for the purposes of depositing a specific check (referred to as a limited power of attorney). You can also specify exactly when your agent may act on your behalf. With a springing power of attorney, the agent can act only if you become incapacitated. The method used to determine whether you are incapacitated is stated in the power of attorney. Alternatively, an immediately effective power of attorney allows your agent to act the moment you sign the document, even though you are still able to conduct your own financial affairs. However, this document does not limit your ability to carry out your own transactions: It merely states that the other person can carry them out as well.

 

You can also appoint someone to serve as a successor trustee of your revocable living trust. When the trust is first created and you transfer money into it, you will likely serve as the initial trustee and will be in full control of the contents, just as you were before. In addition to being the trustee, you will also be the current beneficiary, which means you can keep enjoying the money and property even though it is now technically owned by the trust. For the foreseeable future, this situation will work well, but the true benefit of the trust is revealed when you are no longer able to fulfill the role of trustee. At that point, the trusted individual you have appointed as your successor trustee will step in and manage the money and property for you, without court involvement. Even if your successor trustee steps up at your death, this occurs without court involvement. Regardless of when the successor trustee takes over, he or she is required to follow the instructions laid out in the trust instrument. This means that the money and property will continue to be used for your benefit during your lifetime and for the benefit of those you have chosen at your death.

 

 

  • Who will communicate your healthcare decisions to medical personnel?

 

If you can’t communicate your medical wishes, your agent under a medical power of attorney can make life or death decisions on your behalf. This person should be levelheaded, able to act under pressure, and able to communicate your wishes, regardless of their own. If there are family members who do not agree with your choices, think twice before giving them the authority to make medical decisions on your behalf. You should also consider the individual’s availability, since medical emergencies can happen without warning. If the person lives across the country, do they have the time and finances to travel if travel becomes necessary? If your first choice has a demanding job or home life, can he or she be reached in time to make a decision over the phone?

 

Medical decisions are very personal. Even if you appoint a capable person, you should provide him or her with your wishes in writing. A living will or an advance directive can be a valuable tool for your agent. The living will lets you state your wishes regarding your end-of-life care: Do you want medication to help manage pain? Do you want to be put on a ventilator if needed? This information can allow your agent to make the best decisions on your behalf.

 

 

  • Who will look after your minor children, even temporarily?

 

If you have a minor child, you know that children require supervision. In case you are not able to take care of your child, you’ll want to appoint someone to step in and take that responsibility, even for just a short period of time. This person must be able to take on the mental, emotional, and possibly financial responsibilities of raising your child. Because it is impossible to know in advance the amount of time your child would need to spend with them, you will also need to consider whether the person is geographical close or if your child might be required to move, even for the short term.

 

 

  • Who will look after your beloved pets?

 

In the event you find yourself in the hospital for an extended period of time, your pet will need care. Who would you choose to take care of them? Does this person have pets of their own? Will those pets get along with yours? Can the person afford to care for your pets, or do you need to make financial arrangements upfront? 

 

 

  • How do you want your property divided at your death?

 

As you divide your assets among beneficiaries, consider the best interests of each person. You do not have to give the money and property to your loved ones outright: You have options. 

 

If you would rather not give a chosen beneficiary access to 100% of the money and property they will inherit, you can stagger distributions over a period of time. For example, the beneficiary could receive 25% at age 25, 50% at age 35, and the remaining 25% at age 45. By staggering the distributions in this fashion, you can help your young beneficiary build a nest egg for retirement. 

 

If you want to incentivize certain behaviors, set aside money or property until your beneficiary accomplishes certain milestones (i.e., graduates college, stays sober for 180 days). You may be concerned that an inheritance might derail a beneficiary from a productive path. By making the distributions contingent on certain behaviors, you can prevent this from happening. 

 

For some beneficiaries, you may want to leave the distribution to the discretion of the named successor trustee. If your chosen beneficiary has creditor issues, their creditors can only take the money or property that has been given to the beneficiary. So long as the money and property remain in the trust, and the trustee is not required to make distributions to the beneficiary, the money can be sheltered from this fate. A properly structured trust can also prevent the beneficiary’s former spouse from taking the inheritance due to the limited control your beneficiary has over the money. This is not to say that your beneficiary will never receive any benefit from the trust: It just means that the trustee can make distributions in the best interest of the beneficiary, at the best time and in the right amount. 

 

We Are Here to Help

We are here to help you navigate through the estate planning process, and we are happy to arrange an appointment by phone or video conference. We are here to work with you so you can remove barriers and begin planning for the future. 

 

You can use the link below to schedule a call with Gabriel Katzner, or just call us at 855.528.9637 to learn more about how best to plan today to protect those most important to you




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