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The Law Offices of Julia P. Wald
February 29, 2012
An Estate Planning Oil Change

Dear Galen,

Many of the readers of this newsletter have a car or truck or motorcycle which they would like to continue to drive for some period, maybe years.  Savvy owners of automobiles know that to keep a vehicle running so it will start up when you want to get going, you gotta take care of it. 

Ok.  So what does that entail?  Change the oil every 3,000 miles?  No problem, but wait...is that correct?  I've been told vehicles of recent vintage can run on the same oil for 5,000 miles or more.  
Maintenance Checklist
An Oil Change is Not Enough
A Will is Not Enough
A Bit About the Cost
Are You Ready?
An Oil Change is Not Enough

A professional diagnosing maintenance needs But more to the point, just changing the oil is not enough.  As a responsible owner, you need to do all that other stuff to your car.  Well, maybe not YOU but someone.  You know, "stuff' like checking the brakes, changing the filters (what filters?), checking the fluids (how do you do that?) And no doubt other things that I can't name just now. If you don't know what all "that other stuff" is, you better take your vehicle, perhaps it is the one you named "Maggie" or "Ferdinand", to someone who does.  Right?  

So you wake up one morning, maybe the first day of the year or your birthday or your child's 6th birthday or the day after your aunt dies, some day, often a significant one, and you think, "I REALLY NEED TO WRITE MY WILL".  

That is like, "Oops I haven't  had the oil changed for 6500 miles, I really need to do that".

If you delve into what your thought about the Will really means, most often it doesn't mean "I am going to write my Will" but it means something like, "I need to see a lawyer who can write my Will" and if you are reading this Newsletter, I hope it means, "I need to see Julia Wald (or someone in her office) who can write my Will".

Now here is the point, while you think first about changing the oil but really mean you need to get your car serviced, you first think a Will, but really mean you need to work with an attorney (Julia!) to do an estate plan for your family.
A Will is Not Enough
One Document Doesn't Do Everything You Want

Car detailingAs a reader of this Newsletter you know that chances are good that you need a Trust Agreement (more on that in coming newsletters...) supplemented by a "pour-over Will".  Or possibly your primary document can be a Will.  That is the basic element, like changing the oil.  But there is more "stuff", more documents you need, and it would be best if you engaged an experienced, careful lawyer to design your estate plan.

What other documents are needed?  I would recommend (as I believe most good estate planning attorneys would), that you have drafted for you at least the following:

Durable Power of Attorney for Finances
(used to appoint an agent to manage your money, incoming and outgoing, think, bill paying, the appointment to begin when you chose, but most likely when (if) you lose capacity).  The agent will only control money that is not in your trust (if any).  The document ceases to be effective and valid when you die.

 
Car detailingGeneral Assignment (a document that is used to make your Trustee the owner of all your property that you wish managed under the terms of the Trust Agreement).  Most likely, you or your and your spouse is/are the Trustee so you are giving yourself/yourselves in your capacity as trustee the property you now own individually.


Certificate of Trust (a brief synopsis of the Trust Agreement to show to financial institutions when they need to know that there is a trust and the identity of the Trustee(s)).

Deed or deeds (needed to transfer each of your parcels of real property, including your house, to your Trustee and to  make a public record of the fact that the parcel is owned by the Trustee of your trust and managed under the terms of the Trust Agreement).  This kind of transfer does not trigger an increase in property taxes.


Pour-over Will (primary purpose is to say that your assets which are not owned by the Trustee should be given to the Trustee).  The Will can say other things, like who gets your motor scooter or Aunt Jessie's china, etc.

These are the primary documents that deal with your wealth, your assets, your cash and house.  Car detailingAnd there is another very important document which speaks your wishes for care of your self, not what you own, but your body, in particular after you can no longer speak your wishes.  It can also address issues of who will visit you in the ICU and what happens to your body after you die.  It is a little confusing that this document has a number of names but these names refer to the kind of document that states your directions for your health care/care of your body.  

Durable Power of Attorney for Health Care/Directive to Physician/Health Care Directive/Living Will (used to appoint an agent to manage your health care when you cannot do so but according to guidelines chosen by you and spelled out in the document).

With these documents, you are doing real maintenance -- and not just an oil change -- for your estate plan.
A Bit About the Cost
And a Look at a Sample Engagement Letter

For most people it is more daunting to go in for estate planning than it is to go in for servicing of the car. 

Drive-thru isn't always the best dealEstate planning, like car servicing, may seem to you more expensive than it should be.  Of course you can cut your costs by going to what lawyers call "trust mills" but you may not be satisfied with the results.  You may find that the trust is from a cookie cutter form and not tailored to your wishes and a loss leader so that the office really makes its money selling insurance or annuities. 
 
I thought it would be helpful to attach a copy of our engagement letter so that when you come to this office you will already know what to expect in terms of service and cost.  The letter is addressed to a single person.  The letter for a married couple or partners is similar. 

The two most important differences are that the letter for couples asks that they waive any conflict of interest because the law requires that if two people are represented by one firm, they must each waive any conflict of interest that might arise; it also tells them that anything one of them tells us will be repeated to the other (no secrets!).  The cost is different, too.  The cost to a married couple is approximately $4,000.  There are the same provisos about the cost in the letter to a married couple as in the letter to a single person.
Are You Ready for Your Estate Planning "Oil Change"?

Dog with an estate plan!
I hope the comparison of an oil change to a full vehicle maintenance gives some sense of the difference between creating a Will and developing an estate plan.  We talk about an oil change even when we know we want more!

 

The attorneys at the Law Offices of Julia P. Wald would appreciate the opportunity to discuss exactly what an estate planning "oil change" would mean for you.

 

Please give us a call at 415.482.7555 if we can answer any questions or to schedule a meeting with us.

 

 

Sincerely, 

 

JULIA  WALD 

The Law Offices of Julia P. Wald
1108 Fifth Avenue
San Rafael, California 94901
415.482.7555