When a California woman died last year at age 91, her caretaker was left in control of her assets. The caretaker, now 63, met the woman in 2002 when she was recovering from surgery in an Orange County care center. When she left the facility and went home in 2003, the caretaker continued to visit and provide care for her.
The living trust has become a popular estate planning vehicle for many California residents. A trust is a legal arrangement in which property is transferred to a trustee, who manages the property for the benefit of the persons named as beneficiaries in the trust document.
The basic concept of a trust is very versatile and can be adapted to accomplish a number of goals. One of the most useful forms of trust for California residents is the special needs trust, which is designed to provide for the supplemental needs of a disabled person while maintaining their eligibility for needs-based government assistance programs.
California residents may have seen the recent blog post regarding the California statutory will, which is the most basic, fill-in-the-blanks will that a person with few estate planning needs can use. While this will could actually be useful in a pinch, it provides almost no flexibility in regards to the terms of the will, and those who need to modify it may end up accidentally nullifying the will entirely in the process. For those reasons alone, a statutory will is almost never recommended for people with anything beyond the most simplistic estate planning needs.
When something is broken, the solution most people in California think of is fixing it. When a car breaks down, most people take it to the auto shop. When an appliance stops running, most people call a professional to come take a closer look. Very rarely is the best solution to throw out the old car or refrigerator and just buy a new one.
People were stunned and saddened to hear about the death of one of the world's most innovative comedic minds earlier this month. Robin Williams' suicide was completely unexpected to most people, even those who knew him best. His family, friends and fans will mourn the loss for years to come, but even in light of this tragedy people can add "good family provider" to the list of things for which Williams will be remembered.
People in California may have heard that the late actor Philip Seymour Hoffman declined to set up any trusts for his three children, saying he didn't want them to be "trust fund kids." Recently, the musician Sting said essentially the same thing. With this recent negative celebrity press for trusts, it might appear to a casual onlooker that wanting financial security for your children is somehow a bad thing. Sure, most people would want to avoid enabling a stereotype "trust fund kid," but just because a child or heir has a little financial security or jumpstart is by no means a sentence condemning them to a lifetime of coddling and laziness.
People in California may have seen a recent editorial about people who have had the good fortune to pass on their wealth to future generations, and the surprising backlash many people in the American public seem to have against their heirs. While many people are quick to criticize people who they feel haven't "earned" their wealth, it is obvious that common misconceptions have a lot to do with the reasons the public perception is so negative. After all, the American dream hinges on the ability to create success, and then share that success with loved ones and future generations.
People in California and readers of the blog know that there are a number of tools available to estate planners looking to maximize their assets for the good of their heirs or favorite charities. However, what many people do not realize is that state laws can have serious estate planning implications, especially when state tax agencies come to exact their pound of flesh.
Readers of the blog here in California know that setting up a trust can be an excellent way to preserve and utilize money for a specific purpose, or a specific person. Many estate plans include at least one trust, and they are favored because of the peace of mind and stability they can provide. However, one integral person in the trust can often be overlooked: the trustee.