Life is uncertain, thousands of people face unexpected accidents or health issues. You must be the one making all the important financial decision for your family but what happens after you? Failure to plan your asset distribution can bring a lot of financial difficulty to your family. In such situations, the estate distribution goes in the process of probate and hiring an experienced San Diego Probate Attorney becomes an absolute requirement.
We have explained a few important steps you need to consider planning your estate in the event of your death.
- Draw Up a Will:
If you die without drawing up a will, there is no certainty that your family will inherit your estate. The court distributes your property amongst your spouse and children. If you do not have immediate family, your property is distributed amongst your distant relatives. If you do not have any family and relatives, it goes to the state. If you have minor kids and do not appoint a guardian, the future of your children is decided by the court. So be sure to make a will for your assets and keep updating the will periodically.
- Get a Life Insurance:
If you have someone to support for when you are not around, getting life insurance is a must. Estimate how much life insurance you need by calculating your mortgages, debts, loans, expenditure for spouse and kids, and all of their predicted future needs. Don’t forget to understand the flexibility and options for cashing in the policy while you are still alive. If needed, involve your CPA and/or financial planner for additional advice.
- Avoid Probate:
Probate means settling of debts and distribution of property with the help of an executor. The process of probate can be painful for many as the settlements may get delayed and your estate will be tied up for months. On the other hand, you will have to bear legal fees as well. Not all properties can be subjected to probate. Life insurance money, retirement funds, joint property, bank accounts, etc. are given directly to the beneficiary.
Another disadvantage of putting your property in probate is that it is put in public records and your relatives are notified to challenge your will. The entire process can get quite messy for your family members. It is better to avoid such arrangements.
- Set Up Trusts:
If the property is owned solely by you, then it will go under a probate. An easy way to avoid this is by setting up a trust of which you are the trustee and have all control over the assets. The property in the trust goes to your heir after your death hence no probate.
Challenging a trust is difficult whereas challenging a will is simpler. But you need to be very careful and have attention to every detail. It is better to hire an experienced probate attorney to do this for you as making any mistake here will have heavy consequences on your family.
- Distribute Your Belongings:
Other than money and property, you also surely own other articles such as jewelry, household items, paintings, decorative. Make a list of your bequests and sign and allocate who gets what to avoid ugly conflicts. Get appraisals done of valuable belongings and keep updating its value periodically every few years.
- Choose Your Cremation:
Sign the legal documents for authorization of the way you want to be cremated in advance. This will make your funeral easier for your family. According to the State’s law, each child of yours needs to give consent for cremation. This hassle could be avoided easily by pre-planning the entire thing.
A person works hard in his/her lifetime to live a comfortable life with his/her family. Hence, it is important to be wise and plan property distribution beforehand as life is uncertain and you just cannot take the risk of putting your family in a difficult spot after your demise.