![]() ![]() The estate planning process can be broken down into a few simple steps: Filing an advance medical directive, or instructions regarding medical treatment if you’re mentally incapacitated or unable to communicate.Appointing power of attorney, or someone to conduct your affairs if you’re unable to do so.Naming an executor of your estate or a trustee for minor beneficiaries.Making a will, this is an official document that records the distribution of assets.It aims to provide peace of mind for you and your loved ones, ensuring that your assets are passed on to your beneficiaries in the most simple and effective way. If you can work your way through the main estate planning tasks now, you’ll set your loved ones up for an easier transition when you die.ĭownload a printable PDF estate planning checklist What is estate planning?Įstate planning involves developing a strategy to deal with your assets and investments after you die. While it might be an awkward or even painful topic to think about, mapping out what should happen to your assets if you die or become incapacitated is a crucial part of financial planning. All international money transfer services. ![]() And in a small estate like this, assuming there's one beneficiary who won't need the protection of having his share in trust (no special needs, an estate that won't be large enough to pay estate tax nor small enough to get Medicaid, and no concern about creditors and spouses), then the TOD account works fine. There's still some work for the lawyer and for the trustee, both of whom have to get paid (unless the trustee is the spouse or a child and waives his/her compensation). Nevertheless, the common workaround in California is a revocable trust. But if your uncle left his estate to your father outright, presumably your father would have been the personal representative, and presumably he would have waived his fee since it would have come out of his inheritance. The other $10,000 would have been the personal representative's (executor's) fee. On such a small estate the risk that the time far exceeds the percentage fee outweighs the possible benefit of the time being less than the percentage fee. But not only would many lawyers not want to negotiate fees on a $300,000 estate, many lawyers wouldn't want to handle a $300,000 estate absent an existing relationship with the decedent, the family, the named executor, or the referring lawyer. There are some lawyers in California who will limit their fees to a time basis rather than the statutory fee. So that statutory fee on a $300,000 estate is $10,000 rather than $20,000. The statutory attorney's fee in California is 4% on the first $100,000, 3% from $100,000 to $200,000, 2% from $1 million to $10 million, 1% from $10 million to $25 million, and reasonable compensation above $25,000. That's why we have estates and executors. ![]() There aren't any cash bequests or estate taxes, and with only one beneficiary there isn't any problem of one beneficiary not wanting to contribute toward paying any debts, income taxes or funeral expenses.īut for larger amounts it would often be better to provide for the beneficiaries in trust rather than outright, and with more than one beneficiary you have to make sure that debts, expenses, taxes and cash bequests are paid. I am not sure why anyone in California would want an investment account’s assets subject to probate.įor such a small amount passing to one beneficiary outright a TOD account is just fine. Not a bad way for the attorney to make $20k. For his fee in handling the probate, the attorney is entitled to 7% of the account balance - probate fees are set by the court. In California, the consequences of my uncle having only one of his two Fidelity accounts set up as TOD resulted in the assets in the non-TOD account being passed to my father - my uncle’s sole heir - through my uncle’s will. ![]()
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