The most common misunderstanding about estate planning is that people think they're too young to create an estate plan. They think this is something that only old people need to do, or that they don't have enough assets to even bother going through the process. Secondly, people put together a will through online websites or a relative who is a lawyer and think that is sufficient for their family to be taken care of. Many people also believe that a trust they created decades ago is still all they need. That is far from the truth. As time goes on, the laws change, the people in your lives change, and what you own changes. It is not a one-and-done event. It is something that should be reviewed periodically to make sure that it still makes sense for you and your family.
People think estate planning is either for wealthy people or it is an estate sale, selling off the property after someone dies. It is really difficult to impress upon people that it is for everyone and that everyone needs to do some planning for their family's future. In California, for years, the minimum amount you needed to own that would put you into probate was $150,000 worth of total assets. In 2020, it went up to $166,250 (with future increases for inflation, currently $184,500 in 2023). People don't realize that this limit is on the gross value of their assets. If your home is worth more than $184,500, even if you have no equity in it, it would end up going through probate. In California, there is almost no such thing as a home worth less than $184,500.
Is It Ever Too Late To Start Planning For Your Assets And Loved Ones?
The ideal time to start planning is probably yesterday. The next most ideal time would be now. If you have anything you want to leave to people that need to be taken care of, now would be the time to do it. If you're married, have kids, or own a home, now is the time to start planning.
Is It A Onetime Planning Document For Estate Planning Or Is It More Than That?
A lot of attorneys provide one-off transactions. They tell clients to call them if something changes in the future. It is never looked at again by most people. A good portion of our practice involves reviewing trusts that have been drafted by other attorneys in the past. People will come in with their trust that was created 20 years ago. Many times, the trustee or successor trustee is someone who is no longer in their life. It is something that should be looked at periodically, unless you have a very simple life with very simple assets, and nothing ever changes. Even then, the laws change periodically. We bring people back in, free of charge, every three years, to review their plans. Some people need more updating than that, so we have plans where people come in every year to see what might need to be addressed.
For more information on Misunderstandings About Estate Planning, an initial consultation is your next best step. Get the information and legal answers you are seeking by calling (951) 332-7079 today.