Estate planning is not one-size-fits-all. It is not possible to create one plan to cover all situations. But when determining where to begin, it helps to break the planning down into a few main categories. Knowing which one you belong in, and what goals you hope to accomplish, makes estate planning easier and more productive.
Will-Centered Planning
When someone doesn’t have a significant amount of assets but do want to make sure their needs are taken care of in the event of incapacity or death. Think of the needs of a young family where their greatest earning potential is ahead of them. Or the young teenager heading off to college. The essential estate planning documents include a complete Will, an Advanced Health Care Directive, and Powers of Attorneys empowering other to act on their behalf during an emergency.
Probate Avoidance Planning
Probate Avoidance Planning is about transferring property to heirs without the burden and costs of probate. At this level, a trust plays a central role in the structure of the estate plan. All the other estate planning documents are used to support and reinforce the trust.
A well-rounded Probate Avoidance Plan will also include a Pour-Over Will, An Advanced Health Care Directive, and Powers of Attorney. In addition, our core package also includes a variety of additional documents and instructions designed to make management of your trust as easy as possible for both you and your chosen agents.
Specialty Planning
This category is about planning to achieve a particular goal that cannot be accomplished through other plans. For example, qualifying for Medi-Cal and avoiding Medi-Cal reimbursement might require specialized trusts that are drafted based on Medi-Cal’s rules. Special Needs Planning involves taking care of someone who is disabled and may need government assistance which even a modest inheritance would cause problems. Or Asset Protection for someone who wants to take that extra step to protect their home and property from aggressive creditors. Each form of specialty planning requires specially-tailored documents to achieve their ultimate goal.
Tax Avoidance Planning
Tax Avoidance Planning involves protecting and transferring large amounts of wealth and assets to be passed to the next generation with minimal estate and income taxes. Using specialized trusts, large amounts of wealth and highly appreciated assets can be passed on with little or no taxes. This plan level could also be used by business owners seeking to pass on their business assets to the next generation so they can build upon your success.
Choosing the right level is essential to beginning your plan right. But each client is different and unique. Nobody has exactly the same family, property, and concerns as you do. This means crafting personalized plans is necessary at each level.
Contact Yeager Law for any questions, comments, or concerns.