Is estate planning on your to-do list? Is it one of those things that keeps getting put off longer and longer because life always seems to get in the way? We get it. Life gets busy. It is also filled with unexpected happenings. This is, however, exactly one of the best reasons to move estate planning to the top of your priority list.
Let us take an example of a central estate planning tool and what it can accomplish. A will is perhaps the most commonly referenced and known estate planning tool. It is best known for its distribution of assets to heirs upon the death of the testator, the person who created the will. It also, however, can name a personal representative of the estate. The personal representative plays a central role in executing a variety of important tasks in the probate process after a person passes away. Furthermore, a will can be used to select a guardian for your children should you die while they are still minors.
Think about all the important things that can be accomplished by putting a will in place. Now, what happens if you die without a legally valid will?
What Does It Mean to Die Intestate?
When a person dies without a legally valid will in place, it is referred to as dying “intestate.” When a person dies intestate, his or her estate will be divided and distributed according to the laws of the state, which may not necessarily fall in line with what the person would have wanted had he or she put a will in place. It is important to note, however, that property that passes pursuant to the state’s intestate laws is only that property that would have been passed through a will and the probate process.
Several important assets may fall outside of this. For instance, a living trust will not go through probate. Instead, it’s corpus will be distributed to trust beneficiaries according to the terms of the trust. Life insurance proceeds will also fall outside of this and pass directly to the named beneficiary on the policy. Pay on death bank accounts and transfer on death accounts will also avoid passing through intestate succession.
Those assets subject to the intestate laws, however, will be distributed according to what relatives survive you and in an order from closest surviving relatives to more distant relatives. For instance, if you have a child, but no spouse, your child will inherit everything. If you have a spouse, but no children, your spouse will inherit everything. If you pass away and have a surviving spouse as well as a surviving child or grandchild, your spouse will inherit all of your community property and half of your separate property. Should you have a surviving spouse and two or more children, your spouse will inherit all community property and one-third of your separate property. Your children will inherit the remaining two-thirds of your separate property. Distribution of your assets will pass to more distant relatives should you have no surviving immediate relatives. Should you have no surviving relatives, your assets will pass, or “escheat” to the state of California.
Estate Planning Attorneys
Don’t let the courts and state laws determine what will happen to your assets and your loved ones after you are gone. Take control of your future and talk to the trusted team at OC Wills & Trusts about getting a comprehensive estate plan in place right away. Contact us today.