INTRODUCTION TO ESTATE PLANNING - APRIL 2024

For the next few months, we will be revisiting an article series written by Willaim R. Remery, an Elder Law Attorney. If you enjoyed last month’s Introduction to Conservatorships, enjoy this month’s intro to Estate Planning.

I have been involved in estate planning for nearly my entire fourty-plus years of law practice. While the answers have changed from time to time with changes in probate laws, tax laws, and Medi-Cal rules, the questions have not changed significantly  over the years. It seems that every day I field questions such as:

• Which is better; a will or a trust?

• If I die without a will, will my property escheat to the state?

• How can I avoid probate?

• How can I avoid taxes?

• Can I prevent any fighting over my estate when I am gone?

• How can I make sure that my no good (son/cousin/brother-in-law/sister...) gets nothing when I die?

• Will my trust affect my spouse’s eligibility for long term Medi-Cal?

• What would happen if I just gave everything away before I die?

• Can my executor take care of my bills if I become incompetent?

In asking those and similar questions the clients are seeking information to address areas of specific concern to them. My job as an attorney is not only to answer those specific questions, but also to raise with the clients other issues which could or should affect the client’s estate planning decision. There is no one estate plan which is right for everyone. Good estate planning involves balancing many different issues, depending upon their relative
importance to the specific client.

For example, one client may be most concerned about avoiding taxes; another may be most interested in avoiding Medi-Cal claims; and others may be concerned more about how their affairs will be handled while they are still alive if they become incompetent. The problem is that, if a person focuses on only one issue, the resulting estate plan may fail to address other problems which should be of even greater concern to the client, or which may arise in the future, and which could completely defeat the planner’s wishes.

Accompanying this article is a chart which I use during speaking engagements on estate planning. Across the top are various estate planning options, including no estate plan, wills, trusts for tax purposes, trusts for non-tax purposes, ownership title such as joint tenancy and life estates, beneficiary designations, contracts (including insurance and annuities), and gifts. Along the side of the chart is a list of common concerns which are to be considered before a final estate plan is decided upon. You may wish to add to the list other personal concerns you may have. Each of the issues listed along the side are dealt with differently depending upon which of the estate planning options is chosen along the top.

The chart does not provide automatic answers to estate planning questions. It is simply a checklist. You should consider each of the concerns listed along the side and any other personal concerns you may have and then rank them in relative importance. Then consider which of the estate planning options best addresses your most important concerns. Over time, different issues may become more important and others may cease to be important,
which means that an estate plan should be reviewed and updated periodically. For example, as children reach adulthood, there is usually less need to plan for their care or for the handling of their share of the parent’s estate. Also, as property appreciates in value, a relatively small estate may become more substantial and require tax planning. 

Unfortunately, there are so many variables, including the size and nature of the planner’s estate, the condition of the planner’s health, on-going family relations, and the planner’s personal preferences, that it is impossible to come up with one estate plan which is “best” for everyone. That is one reason why the free trust seminars which are advertised in the newspaper can be so misleading. At those seminars, the speaker typically explains all of the good  things about the particular “one size fits all” trust that he is trying to sell. However, rarely at those seminars will you hear about the adverse effect that the trust may have on your qualification for long term Medi-Cal or about much simpler and cheaper ways to avoid probate if you have a very small estate.

Each of the estate planning options should be considered as a possible component in an overall estate plan. It may be that some gifting should be combined with title changes and possibly a trust or an annuity to best handle the  most important issues. In other cases, a simple will is all that is needed. The key is to keep all of the issues in mind and to avoid becoming fixated on any one particular issue, as you consider your estate planning options. Unless  you are well versed in the many areas of estate planning, it is important that you get advice from a qualified elder law professional to make sure that you understand which issues should be of most importance to you under your particular circumstances and which of the  estate planning options best address your most important concerns. Be very cautious of anyone who is selling a particular product such as a trust or special investment. You may find that they have a very narrow perspective on estate planning which fails to address many important issues. 

In future articles I will go through the concerns listed on the chart in some detail, to explain what they mean and which of the estate planning options are most effective in dealing with them. If you have a particular estate planning concern which does not appear on the list, please write to me in care of PRO, describing your specific concerns, so that I can  address them in a future article. William Remery, Esq., can be found in PRO’s Wellness Village at
www.parkinsonsresource.org/WilliamRemery.