ESTATE PLANNING IN DETAIL

Components of a Comprehensive Estate Plan

As noted, every estate plan created by Coggins Legal is unique to every individual's specific goals and circumstances. The following discussion will provide you with a look into the various components that may make up a comprehensive estate plan prepared by Coggins Legal. 

Revocable Living Trust

A revocable living trust is like a contract that you enter into with yourself outlining your wishes in the event you are alive but not well, or in the event you have died.  Because it is similar to a contract, the document is effective immediately upon signing.  As such, the administration process for a trust after death can be private and prompt in circumstances where the estate is simple and the interested persons all get along, which is entirely different from a will-centered plan in which your representative must file for a public probate and seek the Court’s blessing before acting on behalf of your estate. 

 

A living trust names trusted individuals as your “successor trustees”.  These successor trustees are the persons who will act on your behalf in the event you are incapacitated or after you have passed, and they will be the persons who carry out your wishes as outlined in the trust document. 

 

For a trust to be effective on the transfer of your assets during incapacity or after death, you will retitle your assets from yourself individually to yourself as trustee of the trust.  However, despite the retitling of your assets, you will not lose any control over those assets while you are alive and well.

 

Last Will & Testament

A Last Will & Testament is another form of document in which you can identify your wishes for after your death.  In a will-centered estate plan, the Last Will & Testament serves as the controlling document for the direction of your assets and your estate after you have left the planet.  The Last Will & Testament identifies trusted individuals as your “executors” to carry out your wishes after your death, and also identifies guardians you have chosen for your children in the event any child is under the age of 18 years old at the time of your passing. 

 

Though similar to a Revocable Living Trust, a Last Will & Testament is not effective during periods of incapacity.  Additionally, the Last Will & Testament will not immediately become effective upon your death. For your trusted individuals to start working on your behalf under a Last Will & Testament, your Executor will file for a probate with the Court and the Court will sign off on the document and give the authority to your Executor. 

Pour Over Will

A Pour Over Will is a supporting document to the revocable living trust.  If you think of your trust as a grocery bag, into which you retitle your assets, the Pour Over Will is the dustpan underneath.  The purpose of the Pour Over Will is to scoop up any and all assets that did not make it into the trust during your lifetime and drop them into your trust after your death without the need for a full probate process.  This ‘safety net’ will help your successor Trustees with the administration of your estate and will minimize the court involvement needed for any assets not titled to the trust.

 

In a trust-centered estate plan, the pour over will is also where you will identify the guardians you have chosen for your children, in the event you pass away before any child is over the age of 18 years old.

 
 

Power of Attorney For Finances

A Statutory Power of Attorney for Finances is a document that identifies trusted individuals and grants them the authority to act on your behalf regarding certain legal and financial matters.  This is typically a 2 or 3 page document, with specific language that is provided by California law. The power can be effective immediately or can be made effective upon the happening of a future event such as the determination of your incapacity by a treating physician. Powers that are typically considered in a Statutory Form include transactions concerning real property, personal property, stocks and bonds, commodities and options, banking, business operations, insurance and annuities, claims and litigation, retirement plans, and taxes.  

 

A Durable Power of Attorney for Finances also identifies trusted individuals and authorizes them to act on your behalf regarding legal and financial matters.  Unlike the Statutory Form, a Durable Power of Attorney typically discusses and authorizes a much broader range of legal and financial activities and can be upwards of 20 to 30 pages in length depending on how many powers you wish to give to your agent.  Similar to the Statutory Form, this document can also be made effective immediately or can be made effective upon the happening of a future event such as the determination of your incapacity by a treating physician.

 

Advance Health Care Directive

An essential document for any estate plan, the Advance Health Care Directive, or Power of Attorney for Health Care, typically serves three functions. The Directive will include a Power of Attorney for Health Care, in which you identify individuals you trust to make health care decisions for you when you cannot make those decisions for yourself.  The Directive will also let you give specific instructions about your health care, such as instructions regarding pain relief or instructions regarding withholding or withdrawing treatment to keep you alive.  Finally, the Directive allows you to express any intentions you have with regard to the donation of organs, tissues and body parts after your death.

 

HIPAA Release

For your health care agents to make informed decisions on your behalf, a general HIPAA Release will be an important document to round out your estate plan.  A general HIPAA Release will usually be accepted by any medical institution and will allow the persons identified in the document to access your medical records and speak with your treating physicians. This is also important for allowing individuals to receive updates regarding your medical status and treatment in cases where they may not be able to make it to the hospital or treatment facility, or where they may not be in contact with one of your Health Care Agents.