Disclosure: This post is an attorney advertisement, sponsored by LS Carlson Law.
Have you chosen guardians for your children, in the event something were to happen to you? This can be a difficult decision for some parents, and we understand. But we feel strongly that it’s an important thing to do, so we’re sharing this expert advice.
When it comes to our children, making sure they are well taken care of is our job as parents. Most things we do for our kids are easy, but some things, like naming guardians, can become challenging. Whether it’s simply not wanting to think about end of life issues, or the fact that we may not know how to make this crucial decision, or whatever your reason is, naming guardians can stir up many emotions.
But putting this decision off will not make the necessity go away. We all know this is something we need to do, and this article will help you get started. There is no better time!
Estate Planning Attorney Linda Honey, Esq.
To get an overview about naming guardians and understanding how that fits with Estate Planning in general, we spoke with Linda Honey, Esq., an attorney with LS Carlson Law who’s highly experienced in estate planning. Linda earned a B.A. from UCLA, graduated from Southwestern Law School, and earned an LLM in Taxation from Chapman School of Law. She is the Estate Planning Department Chair at LA Carlson Law, and a SoCal mother of three.
Linda knows that every family’s needs and situation are unique, and her approach is to help each of her clients maximize their estate and minimize their liabilities, including potential taxes. We asked her the questions we know parents have. Her answers are in italics below.
Call 949-577-6631 and mention MomsLA to schedule your FREE half-hour initial Estate Planning Consultation.
Related: Life Insurance 101 for Parents
How to Get Started Choosing a Guardian
Why do parents need to name guardians for the children, and why do some parents hesitate?
“I know this unpleasant topic is difficult for most people to contemplate. However, as parents, we always want to do what is best for our kids, and planning your estate is no different. So, as unpleasant as it is, knowing what could happen to your family if you don’t plan ahead can help motivate you to tackle this difficult subject so you don’t leave a mess behind for your spouse or children to clean up.”
What happens if I don’t formally name anyone as a guardian? Won’t my parent (or sister, brother) just automatically be my child’s guardian?
“Without a parental nomination of guardian, the court will decide what is in the best interest of your child. This process does not need to be contentious; however, you might be able to imagine the conflict that can arise if you have different family members asking the court to be the guardian. A nomination can avoid such conflicts as well as protect your child from being forced to take sides in contested requests.”
How should we start thinking about who the best guardian for our kids would be? And how should we start the conversation with our partner?
“When selecting the best guardians for your children, remember to stay focused on what’s best for your kid. If you’re married, having an initial conversation with your spouse on the topic of planning ahead so your children are protected in the event of death, can help both spouses keep their focus on your child. Having gone through this process myself with my husband, there’s an innate desire to leave your children with someone you might like the most. Unfortunately, who you like may not be the best guardian for your child. One method I used was to work “backward” by making a list of the attributes I want in a guardian. Then using the list, I had my nominations, and my husband had his. Luckily, the guardians we chose were the same because we were focused on the attributes instead of possibly our personal feelings.”
What if the family member I would choose as a guardian lives far away? What if I have several family members I think want to be chosen – or, what if I don’t have any family members I would want to be my child’s guardian?
“This is the problem on the opposite end of the family spectrum – having many family members and fear of offending someone to lack of relatives to help you. Talking with an attorney in circumstances like this can be very helpful. I have handled countless estates from planning to administration, so I’ve seen my spectrum of issues. Depending on the position of your agent, distance may not be a factor, and if it is, I like to present different options to help my client understand the possibilities.”
What if I want to do all this by myself, using an online tool?
“There are many online programs that can draft a trust for you. It may be sufficient to avoid probate, but the trust can only be as effective as you are knowledgeable about the area. All too often I get to review online trusts when the trust maker wants to make changes. I will always confirm how the trust and estate was planned and 4 out of 5 times, there’s something in the estate plan the trust maker was not aware of. Having an attorney to help you understand your plan is so crucial in this area where we are talking about the welfare of the people you love.“
“There are just very practical matters an attorney can help you understand. Here is a simple example: I generally advise my client to never put their original estate documents in a safety deposit box without planning ahead because a court order is required to open a safety deposit box in your name.”
How do you help parents navigate these and other end of life issues when they may not want to face them?
“When it comes to end of life decisions, even without a healthcare directive, your family will do their best to give you the best care possible. However, a healthcare directive is important so your personal wishes are respected when you’re unable to communicate. Some of your wishes may be difficult choices to make and your family members may disagree. That’s where a healthcare directive is helpful so the person you name has the authority to make decisions based on the instructions you leave behind. Estate documents, such as this, are not just to make sure your wishes are carried out, but are helpful to your family knowing that they are making healthcare decisions based on your wishes.”
Click here to find a free, downloadable Guide to Naming Guardians and Estate Planning from LS Carlson Law.
Naming Guardians is part of Estate Planning
What is estate planning?
“Estate planning encompasses many areas including asset protection and tax planning but generally it is the process of preparing how your property is managed and handled at your death or incapacity. It includes several documents to cover unexpected circumstances. Generally, an estate plan includes a trust, which is the main vehicle used to transfer and manage your property after your death, a will to make sure any property inadvertently left out of the trust is transferred to the trust, a durable power of attorney so someone is able to manage your finances in the event of your incapacity, a healthcare directive with your end-of-life wishes, and of course the nomination of guardianship of minor children.”
What is considered part of an estate and what isn’t?
“An estate is basically everything you own. Everyone has an estate – it includes your car, your house, all your personal property, and of course all your bank and financial accounts.”
What if you own a business?
“Business succession planning is something every business owner should consider. Your business interest is part of your estate, but what happens to your business and how your family can benefit will depend on the plans you have in place. Business interests are held in trust in many circumstances to avoid probate. This area is so specific to the business and contracts you have in place that speaking with an attorney is almost necessary.”
What is a revocable living trust?
“Revocable trusts are agreements that specify how you want your property handled at your death. Basically, you, as the Trustor, transfer property to the Trustee who is the legal owner that manages the property for the benefit of the beneficiaries. In most circumstances, the Trustor is also the Trustee so you still have control and access to your property.”
What are the most common misconceptions people have about trusts?
“Probably the most common misconception is that trusts are only large estates, which is not the case. Another common misconception is that it is difficult to change and difficult to administer. Your trust is revocable, amendable, and changeable during your lifetime. There are no separate tax returns to file. Aside from making sure title to your property is in the trust, you’ll have minimal administration requirements.”
Does everyone need a trust? What if you don’t own a home?
“Of course, some people benefit more than others from a trust, but in my experience, most people tend to benefit from having a trust. But I’ve also met people happy with how their estate will be handled at their death without a trust. Understanding what will happen is important in deciding whether you should have a trust. A single person without a child or a home can still have a sizeable estate – cash, stocks, business interest – and you may like the power to control who gets your property – whether it’s a friend or a nonprofit.”
I worry it will cost too much and take a long time to make a trust – can you speak to that?
“The cost of an estate plan depends on the value you place on the benefits it provides. But it is important to understand that your estate will have to pay the costs whether or not you plan an estate – the cost may be money in probate fees and time your family has to spend taking care of your estate in court.“
What if I just have a Will? Isn’t that good enough?
“The main reason for creating a trust is to avoid probate. You can use a Will to control who gets your property, but the Will still needs to go through probate.”
Call 949-577-6631 and mention MomsLA to schedule your FREE half-hour initial Estate Planning Consultation.
Probate: What It Is and Why it’s Something to be Avoided
What is Probate?
“Probate in California is not fun to say the least. It is long and expensive. An average estate takes about 1-2 years to complete the process and the fees are set by statute. The fee is based on the gross value of the probate estate, so there is no offset for mortgages, debts, or liens. For example, the fee for a $1,000,000 estate is $46,000 which is $23,000 to the personal representative and $23,000 in attorneys’ fees.”
What’s another reason to want to avoid probate?
“A surviving spouse is dealing with grief and having to open probate before accessing the deceased spouse’s assets and accounts is difficult. Generally, probate freezes a decedent’s accounts so unless the surviving spouse was on the account, he/she will need to be appointed as the personal representative or executor before accessing the accounts.”
Could probate happen to your assets even if you don’t own a home?
“Probate in California is very easy to trigger. The state has a very small threshold of $166,250. So, if your probate estate is more than $166K, you need to open probate.”
Each Family Has Different Needs
How do you work with families and individuals to help them navigate these issues and create an Estate Plan?
“As a mom of young kids, I understand the concerns many parents have when it comes to what might be best for their children. Also, every family dynamic is different so I like to get to know your personal concerns and worries and we work to minimize those areas. There’s always a consequence to your decisions so knowing them is important to making sure your estate and family is taken care of exactly how you want.”
If you’d like to learn more, please contact Linda directly. Call 949-577-6631 and mention MomsLA to schedule your FREE half-hour initial Estate Planning Consultation. Or click over to LSCarlsonLaw.com/MomsLA for more information.
Disclosure: This post is an attorney advertisement, sponsored by LS Carlson Law.
