Estate Planning Design Meeting
Hi. I’m Matthew Crider. Well, we’ve done our initial meeting, and the next meeting is our design meeting.
During that meeting, we’re really going to drill down and ask you a lot of questions about how you want your estate plan to work. There are a couple of things you need to think about before the design meeting. The first thing to think about is who you want to give property to. You may want to give it to family members such as your children, your siblings, or your parents.
You may want to leave your property to other people, so you need to think about who you want to be the recipient of your estate when you pass away. The next thing to think about is how you want to give your property to those people. Now, there are two general ways that you can give property to people.
The first is what’s called a residual gift, and that’s what most people think about. For example, if they have three children, they might say that each of the three children will get an equal share of the estate upon their death. There is another way to give property, and that’s what’s called a specific gift.
You can give a specific amount of money. You can give a specific bank account. You can even give real estate to specific people, whether they are your blood relatives, your family, or entirely different people. You need to think about whether you want to leave specific gifts to specific people, and if so, what those gifts are.
You can also leave gifts to charity, and there are two ways to do this. The first way is to leave a percentage of your estate. You might, for example, say that you want to leave 10 percent of your estate to charity. You could also leave a specific gift to charity, and this works very similar to a specific gift to an individual.
You designate a specific piece of property such as a bank account, investment account, or so on, and then you name the charity that you want to receive it. Or you could leave a specific dollar amount to charity as well. Now, there are a couple of important roles in your estate plan.
If you have a revocable living trust, you will be the initial trustee of your trust, meaning that you will be in complete control of your trust. We’re going to talk about trustee in more detail, but you want to name successor trustees as well. You want to name a person or people that you can have to take over management of your trust estate if you become incapacitated or when you pass away.
Now, there are other important roles as well. For example, we’re going to prepare a durable power of attorney for you. This is where you designate somebody to make financial decisions for you for the property that’s not in the trust if you can’t manage your day‑to‑day finances. This power of attorney will become effective if you become incapacitated.
You need to think about who will be in that important role. Who will be your financial agent if you’re not able to manage your day‑to‑day affairs? We’re also going to prepare a healthcare power of attorney. In California, that’s called an advance healthcare directive.
Just like with the financial power of attorney, with an advance healthcare directive, you can designate a person or several people to make healthcare decisions for you if you’re not able to make healthcare decisions for yourself. You need to think about who that person or who those people are. Now, let me make a comment about those important roles.
Typically, most people will designate one person at a time. For example, you could have person A as a successor trustee, or as an agent under a power of attorney, and then if person A is not available, you could have person B next in line. If person B is not available, then you could have person C next in line, and so on.
It’s also possible to have people serve at the same time, and so, for example, you could have person A and B serve jointly as your successor trustee or as the agent under a power of attorney. You could have that as well. It’s really up to you about who you want in the important roles.
Now, it’s common for a lot of people to have the same person, or the same people, as their agents under a power of attorney and an advance healthcare directive as they have named the successor trustee.
In other words, they’ll have one list of people that they want to be in the important roles, and that list is the same for the trust, for the power of attorney, and for the advance healthcare directive. However, it’s not required that you have the same people in those roles. You could have entirely different lists of people to serve in each of the roles that I just mentioned.
Another thing to think about is, who gets to decide whether you’re incapacitated? We recommend that you name, of course, an attending physician to decide whether you’re incapacitated. You also might want to have your spouse or a close relative or loved one to talk in conjunction with the attending physician.
In the alternative, you can have two attending physicians who would make that decision jointly. You could also name an attending physician and a neurologist. Again, these are the people, this is the panel of people that will make the determination about whether you have capacity or whether you’re incapacitated.
Then either the successor trustee to take over, or the agent under a power of attorney to take over. Those are the major things that you should think about in preparation of our design meeting. If you have any questions, feel free to reach out. We’re happy to talk with you in advance of our meeting. Again, my name is Matthew Crider, and I look forward to talking with you.