Buchbinder Law | FAQ's - FREQUENTLY ASKED QUESTIONS - Buchbinder Law
Answers to frequently asked questions about the Law Office of Emily J. Buchbinder, Santa Cruz Counties Law Firm. Includes answers for Trust, Will, Power of Attorney, and Advance Health Care Directive.
ESTATE PLAN, Revocable Living Trust, Will, Durable Power of Attorney, Advance Health Care Directive
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Frequently Asked Questions

FAQ's

What is an estate plan?

An estate plan includes a package of documents – Revocable Trust, Will, Durable Power of Attorney, and Advance Health Care Directive.  The Trust and Will ensure that your property will pass to your intended beneficiaries, as quickly, easily, and inexpensively as possible.  The Durable Power of Attorney and Advance Health Care Directive authorize your chosen agent to manage your financial and medical affairs during life, eliminating the need to have a court appoint a conservator in the event you become incapacitated.

What is a Revocable Trust, and do I need one?

A Revocable Trust provides a vehicle for holding your assets so that your property can be transferred to your beneficiaries without a costly, public, and lengthy court proceeding (probate) when you die. After transferring property to your trust, you continue to use and manage your assets as you have always done. A Revocable Trust can be amended during your lifetime to incorporate changes in your circumstances or in the law.

Do I need a Will?

You need a Will, even if you have a Revocable Trust. The Will that is prepared along with your Trust is referred to as a “Pour-Over” Will because it directs the executor to distribute miscellaneous assets, such as your personal property, to the Trust. Thus, the assets are poured over into your Trust and distributed according to the instructions in that document. In addition, if you have minor children, the Will nominates the person who will become their guardian if something happens to you. If you do not have a Trust and the value of your estate exceeds $150,000, your estate will have to be probated, even if you have a Will.

What is a Durable Power of Attorney?

A Durable Power of Attorney nominates an agent who can take care of your immediate financial needs if you are in an accident or become incapacitated. The document gives your agent authority during your incapacity to pay bills, contact your insurance, communicate with your employer, and carry on your business. A Durable Power of Attorney is effective only during your life.  In the event you become incapacitated and do not have this important document, your spouse or children will have to petition the court to be appointed as your conservator.

What is an Advance Health Care Directive?

The Advance Health Care Directive provides important instructions to your agent about your end-of-life decisions. These instructions include your wishes regarding organ donation, palliative care, and whether to artificially prolong life.

Do I need an estate plan if I don’t have a taxable estate?

Yes. If you die without a Revocable Trust and you have property valued at more than $150,000, your estate will need to be probated, even if you have a will. Probate is an expensive, lengthy, and public court proceeding.  It often takes one year or more to complete the probate process.

As an example, if your gross estate is valued at $1,000,000, your estate will pay up to $46,000 in probate fees.  In addition, there are court filing fees and publication costs.

If I am married and I die, doesn’t my estate automatically pass to my spouse?

Not necessarily. If you have separate property, your spouse will receive only a partial interest in your property. Depending on how you hold title to your assets, your spouse may still have to file a spousal property petition in the probate court to receive your interest in the property you jointly own.  Even if you are married, you need an estate plan to ensure your spouse will not have to pay for an expensive court proceeding upon your death.

Why should I hire a lawyer to prepare my estate plan when I can do it myself for less using an online product or service?

Nothing can replace the personal relationship you should have with your estate planning attorney. Your lawyer knows you, your family situation, your assets, and your goals. The estate plan your lawyer prepares will address your unique situation. A qualified estate planning attorney will know the right questions to ask, discuss the options available to you, and prepare documents tailored for your unique situation. Your attorney will provide important legal advice that will save you taxes during your life and at death.  After the plan is complete, you should have a trusted adviser who will respond promptly to your questions and keep you informed of new changes in the law.

In addition to creating the documents, your attorney will transfer your real property and business interests to your trust and help you properly title bank and investment accounts. Your lawyer will help you complete beneficiary designation forms for your retirement accounts and life insurance so that these assets are transferred to your beneficiaries as you desire, without the need for a court proceeding.  If your trust is not properly funded, the money you spend purchasing an online product will be wasted because your assets will likely be subject to a probate court proceeding.

Will a Trust protect me from creditors?

No. In California, you cannot avoid your creditors by transferring your assets to a trust. You can, however, protect the assets you leave to your children from most creditor’s claims if you leave your property to your children in a trust, and the trust includes special provisions.

What is a Special Needs Trust?

A Special Needs Trust holds assets for an individual who is permanently disabled and wants to continue to receive public benefits. By transferring assets to a Special Needs Trust, the money can be used to provide goods and services to a disabled individual that he or she is not currently receiving without disqualifying that child from receiving public benefits. Money in a Special Needs Trust may also be used to purchase a home or automobile for a disabled individual receiving public benefits.  If you have a disabled child, your trust should state that, upon your death, property passing to that child will be held in a Special Needs Trust.

How much does an estate plan cost?

The cost of an estate plan depends on your marital status, the complexity of your family situation, and the extent of your assets.  Most estate plans can be prepared for between $1,800 and $2,300.  At the conclusion of your first meeting with us, we will quote you a flat fee that includes all meetings, telephone calls, emails, letters, and the preparation and execution of your estate planning documents.