Question: I am trying to figure out the best way to leave money to my children without having to spend a lot of money on a lawyer. I have a pension that will stop when I die, a moderate retirement account, and some checking and savings accounts. I have two children, and I intend to leave what I have to them.
I read that in California, I can do a will on my own so long as it in my own handwriting. What should I be thinking about as I set about doing this myself?
Answer: Have you heard the “shocking” story about the lawyer who tried to wire his own house? There are some things that might be best left to someone who really knows what they’re doing. That said, it can be just as shocking to see what some lawyers charge for a simple estate plan. In some circumstances, it really is possible to handle estate planning on your own.
After you die, your children will look to your last will and testament to determine what your wishes are. But that doesn’t mean that your will controls all aspects of your property distribution. The type of asset and the titling of the asset may also control who handles the property and how it is distributed.
There are many different types of assets, some of which have their own means of transfer after the account holder dies. For example, with a retirement account, the asset will be distributed according to the beneficiary designation form that is on file with the plan administrator. If the two children down are to each take 50%, then the plan administrator will send correspondence directly to the children. In another example, if your checking and savings accounts have a “pay on death” or “POD” beneficiary, the funds will be immediately distributed to the named beneficiaries.
Your last will is important because it controls any assets that do not have beneficiary designations, and it also names the person who you want to act as the personal representative of your estate. The validity of a will depends upon its proper execution, i.e. signing. California law requires two non-interested people (i.e. who stand to take no property interests under the will) to witness the signing of the document. California, however, does have a law that allows for a “holographic will,” that does not require any witnesses, so long as the “material provisions” of the will are in the handwriting of the person creating the will.
A good alternative to a holographic will or a lawyer-drafted will is a California Statutory Will. This will is set out verbatim in the California Probate Code and allows a person to fill in the boxes. It does require two witnesses to its signing. A statutory will can be found online or purchased for a small sum at most stationery stores.
Your question concerns the distribution of your property to your children after you die. But an equally important part of any estate plan is planning for what happens with your property should you lose the capacity to manage it yourself. You need to plan for what happens if you are unable to manage your own financial affairs or if you are unable to take physical care of yourself.
The two documents that can help you to avoid a conservatorship through probate court are a durable power of attorney and an advanced health care directive. A uniform statutory power of attorney is widely available, and advanced health care directives are usually available at most major healthcare centers. For these two documents, you can either get two witnesses to observe you signing the documents, or you can sign in the presence of a notary.
You should educate yourself as much as possible about these documents and what you need. To draft your own estate plan is not impossible, but it requires that you know enough to ask yourself right questions and address them in the paperwork. If you can’t answer your own questions, then you should seek the help of someone who can.
Preston Morgan is a partner at Kopper, Morgan & Dietrich, a Davis law firm providing family law, estate planning and trust litigation representation. His column is published every other week in the Davis Enterprise. To pose a question to Preston Morgan, contact him at https://kopperlaw.com.
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