Estate Planning 101: Putting your affairs in order – what documents to collect to save your family

Generally, we think of “putting our affairs in order” as something we do after we get the terminal illness diagnosis from the doctor.  There are many reasons not to wait for that time to get your affairs situated, but I’ll leave that for another time.  Today I want to talk about what it actually means to get your affairs in order. First, though, let’s see why it’s important:

Have you ever been the one “in charge” after someone has died?  No?  Imagine this: your nearest and dearest loved one has passed away.  You’ve talked to the hospital and picked a mortuary, so that’s a process that’s been started.  It’s really hard to talk about your loved ones “body” or “remains” while you’re still trying to process the loss in the first few minutes or hours.  But then you feel like you have to DO something, so you head to the house to see if you can find the “important papers.”  Two things can happen at this point:

Scenario one is that you arrive, and already know where the estate plan is, and head right for it.  With it are all of the life insurance policies, retirement and bank accounts, instructions, pre-need funeral planning receipts and contact information, and smaller things like an address book to get in touch with all his/her friends, a locked box (which you have the key) with all of the computer passwords, safe combinations and the like.  There seems to be a lot to do, so you contact the estate planning attorney, who, after asking you a couple questions, says, “there’s nothing to worry about and nothing to do.  Take care of you, your family, and the final arrangements.  Then call me back in a couple weeks if you have questions, but the instructions should all be there…just don’t worry about it now.”  So this is what you do, as you start calling friends and family members and bracing for the days ahead.

Scenario two is that you arrive, and don’t know where anything is.  Does s/he even have life insurance?  Where are the bank accounts?  Was there a will?  Where is it?  You start tearing apart the desk, closets, cupboards,…and find nothing.  Now you’re grieving, in shock, have a million things to do, and now you can’t find anything.  This adds to your stress, so you call in other family members, who are now tearing apart the boxes in the garage.  Everything is chaos, and still no information.  It’s overwhelming to the family.

Which would you prefer your loved ones experience?

The former?  GREAT choice.  Now, here’s what to put in the file:

1. Your estate plan, with trust and will.
2. Your powers of attorney.
3. Your life/long-term care insurance information.
4. Your retirement information.
5. Bank account information.
6. Pre-need funeral planning documents.
7. Investment account documents.
8. Deeds of property, such as homes, vehicles and boats.
9. Health, disability, auto and property insurance documents.
10. Income source documents (social security, employment, investments, child/spousal support).
11. Credit card statements and evidence of other debt.
12. Important papers, such as marriage/birth/death certificates, passports, tax returns, military or genealogical records.
13. Names/contact information of trusted professionals, such as accountants, lawyers, financial advisors, gardeners, house cleaners or caregivers, home repair professionals (electrician, plumber, roofer, chimney sweep, etc.).

And one final thought: make sure you have at least one trusted friend or family member who knows where it is and what’s in it.

Need more information? Contact us today to schedule your free estate planning consultation.

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Thinking of filing for divorce? Don’t do it before you read this!

I always tell my clients that getting a divorce generally will take much longer than you anticipate and will be much more expensive than you’d like.  In most cases, this is true, regardless of how hard we work to make it untrue.  It is a complex process involving a great deal of information that must be disclosed, but when you add to that the emotional component that is almost always present, the process can seem unmanageable.  One of the ways to make the process easier – from the very beginning to the very end – is to know and understand in advance what’s going to happen, what the options are, and how the general process can play out.  Too many people run out and file for divorce without really understanding what that means in terms of procedure, process, timing, strategy, and so on.  One of the best things you can do in your divorce is to become as educated as you can regarding the process.  Do some internet research, read some articles, buy some books, and/or consult with an attorney or several.  The more you understand about the process, the rules, and what you can do NOW to make the process easier later, the higher chance you have to maintain your sanity in the craziness that’s bound to come.  Finally, consulting with a compassionate, experienced professional can help, too, because it’s part of their job to ensure you understand everything that’s coming your way in the divorce.

Also, and probably most importantly, knowledge is power. If you’re considering a divorce, you want to know what you’re getting into. You want to know your rights. You need to understand your responsibilities (not making a mistake in the first place is much better than trying to correct one made hastily!). Making informed decisions will make the process easier, smoother, faster, and less expensive on everyone.

You may also want to read why a free divorce consultation isn’t worth the money (click here).

Ready to get some real, professional, personalized, compassionate & caring information & advice? Contact us.

Estate Planning for Blended families: Have step-children or a step-parent? Are you one? How to avoid (unintentionally) disinheriting your family

Estate planning presents unique issues for blended families.  Blended families are families in which one or both parents have children from a previous relationship.  The problem comes when one spouse dies without an estate plan, or an old or outdated one.  Generally, when spouses hold property in California (or anywhere in the US), they hold it in joint tenancy.  When one joint tenant dies, the other one gets the entire property.

Can you see where we’re going with this?

When one spouse of a blended family dies, then the other spouse generally gets all the property of the couple, often by default.  When it comes time to distribute the assets at the death of the second spouse, the second spouse can essentially disinherit the first spouse’s children.  The second spouse, with all the property in his/her name, has control over the ultimate disposition of the property.  If there is a family rift between the second spouse and the step-children, if the second spouse is negligent in creating an estate plan providing for the step-children, or in other cases, then the children of the first spouse to die can be left out in the cold.

Don’t leave your children out in the cold by failing to provide for them with an estate plan. Contact us today to schedule your FREE estate planning consultation.

Secrets of a divorce attorney: Why a free consultation isn’t worth the money

I came across an article recently that purported to give advice on how to select a divorce attorney.  One of the bits of advice was that most “reputable” attorneys will offer a free consultation.  I was stunned to hear this, as I think precisely the opposite!  The free consultation from the divorce attorney is a loss leader, which means that it’s free because the attorney is looking for the potential client to pay the big bucks at the end of the consultation. In addition, the attorney doesn’t offer anything of value to the potential client during the free consultation.

Remember, you get what you pay for!

Many attorneys offer a free or reduced-cost consultation and the appointment goes like this: the potential client arrives and fills out some paperwork, finishing after about 10-15 minutes.  Then s/he waits another 5-10 minutes, so the actual appointment starts at least 15 minutes into the alloted “hour.”  The attorney, naturally, want to know what’s going on, so the potential client spends at least 20-30 minutes – often this is closer to 45 minutes – telling their “story” to the attorney.  So, at this point, it’s been 45 minutes to an hour, and the attorney has yet to *do* anything but sit and listen.  At the end of the consultation, the attorney says, well, yes. I can help you with that.  And the retainer will be $10,000.  Or $5,000.  Or $20,000.  So the potential client has paid nothing to get nothing but a very high retainer quote, and the client has (unless s/he has the money) wasted an hour or so of time.

Is that worth it?  Are these the practices of a “reputable” attorney?

A paid consultation can be more worthwhile, as they tend to be a little longer and involve more attorney advice and counsel.  Often, the intake sheet is sent in advance, and the “hour” spent is really an hour.

Another option is our approach: We ask for your story ahead of time (!) in the form of documents, email, faxes, a letter, etc., send & have you fill out the intake form in advance, and we spend most of the full hour giving YOU real advice that you can use now.  Yes, the consultation costs, but you get what you pay for.

Which would you choose?

How to save money in California divorce

Divorce can be very expensive.  Not only are you separating households, now working with the same funds but supporting two homes (and two rents/mortgages, two sets of utilities, expenses of duplicate furniture, etc…), but you may be taking time off work (unpaid, of course) for court hearings, spending money on filing fees, and – of course – hiring a lawyer.  And lawyers?  Can be very expensive.

I do what I can to keep the costs down for my divorcing clients, from offering flexible options for payment (no, not monthly payments but I generally try to “break down” the case into more financially-manageable pieces for the client), family law coaching, and divorce mediation, but the cost is not entirely under my control.  What my clients do – or don’t do – essentially drives the path and cost of the divorce.  So, regardless of whether you have an attorney or not, here are some ways to keep the costs of your divorce down:

1. Manage your emotions.  Divorce is incredibly difficult even in the best of circumstances.  It is likely that you have some strong emotions around it.  But the court and legal process generally will not be concerned about these emotions, and the more  you bring them into your divorce, the more you will likely pay.  Whether it’s spending excessive time with your attorney discussing the emotional issues or pursuing a losing issue because of an emotional attachment, emotions can bankrupt you when they take center stage in your divorce.
2. Get professional help. As a part of managing your emotions, get the support you need for them by finding qualified mental health professionals to help you through it.  Your lawyer, your family, and your friends will be a great support during this time, but do not mistake any of them as qualified advice helping you through the roller coaster of emotions in divorce.  Find a therapist if you need one.
3. Get – and get rid of – qualified professional help when appropriate.  Hire professionals who are going to work with you, for you, and who are on the same page as you.  If you feel like your lawyer doesn’t care, or is gouging you, or won’t pay attention to you or return your calls, then get rid of him/her.  Your divorce is yours, and you should have legal counsel that you feel comfortable with, who understands what is important to you, and who is reasonable and professional about fees.  Same with your therapist.
4. Play fair.  The court and legal process in California has no patience for bids for revenge.  Mud-slinging and nasty declarations for the purpose of hurting the other party can not only rebound and hurt you, but can cost you unbelievable amounts of money.  They also drag on the process, increase the hostility between you and your spouse, and ultimately hurt your children.

Secrets of child custody success in California divorce

I have many clients that come into my office and say they “want custody” of their children.  What does this mean in a California divorce (or paternity) case?

In California, there are two kinds of custody: physical and legal.  Physical custody involves where your children live.  If they live with both parents, as in most cases, then custody is shared jointly.  In the case where one parent is not involved at all with the children or has domestic violence or substance abuse issues, then one parent may have sole physical custody.  The norm is shared joint physical custody.  Legal custody involves which parent has the right to make the decisions about your children’s health, education and welfare.  Again, this is generally joint except in the instances mentioned above.

What most clients are talking about when they say they want custody is the parenting plan.  This is the schedule of when your children will be with which parent.  I am often asked what a “normal” schedule is, but the reality is that schedules vary as much people do!  The important part of creating a parenting plan is to keep your children’s needs in the forefront of your mind.  They are adjusting, too, and the transition is difficult on everyone.

Second, be reasonable.  You may despise your ex, but that doesn’t give you the right to cut him or her out of your children’s lives – they remain a parent even though they are no longer your spouse.  A judge will frown on an unreasonable request made for no good reason.

Third, pick your battles.  Remember the adjustment period?  Well, that often translates into dropping grades, acting out, misbehaving, sleep problems, and overall a difficult mood or behavior from your children.  This doesn’t mean it’s all your ex’s fault, and it’s not your fault, either.  It’s just a natural part of the process.  Now, if your spouse is acting inappropriately, such as not properly feeding or dressing/grooming your children before school or harming them, then you should see the judge immediately.  But normal acting out in a divorce is, well, normal.

Finally, remember that it will pass.  At some point the custody fight will end and you will settle into a routine.  I mean, you can fight until your children are 18, but do you really have the time, money and energy to do that to yourself and to your children?  The sooner you can get to that normalcy, the better for everyone.

Uncontested divorce in California (part 2): Mediation when both agree

Another way in which an uncontested divorce comes my way is in the context of a couple who are fairly amicable and would like to work together to complete their divorce. Often, they either agree on everything (how to divide assets, on support, and on child issues) or they have one or two relatively minor issues that they’d like help with.  Often, too, the couple is concerned about (1) completing the process correctly, (2) not having time on their own – with family, work, and other personal concerns – to figure out how best to proceed and fill out all of the documents, (3) making sure nothing is left out because of their lack of knowledge of the “ins and outs” of California divorce, and (4) having someone to reach out to for questions and concerns as the process progresses.

Mediation is the way to go in these circumstances. Mediation is where an attorney (or non-attorney, though I generally recommend working with an attorney-mediator) to help you to come to a resolution of your divorce case. It’s significantly less expensive than litigation and drastically reduces the amount of contention and conflict in the process. Essentially you are working together to come to an agreeable solution. Instead of forcing a stranger – a judge – to make decisions for you, your children, your future and your finances, YOU control the process. It’s much quicker, too, than the traditional divorce process.

If you and your spouse get along reasonably well & just want to get your divorce completed as quickly, painlessly, and with the least expense, consider mediation. Want more information? Give us a call at 925.307.6543.

Uncontested divorce (part 1): when your spouse won’t participate

On occasion I talk to someone who tells me that while they want a divorce, their spouse refuses to talk about it and says they won’t participate or sign anything.  Understandably, the spouse who wants the divorce finds this distressing.  But this is nothing to be stressed about, and here’s why:

First, once you file for divorce, your spouse is likely to at least seek out some kind of advice from someone, whether it’s looking around online, buying a book, talking to a family member, or talking to a lawyer.  When faced with an unknown, most individuals will act in self-preservation.  Since the only advice to give to someone who says they don’t want to participate in their divorce is DON’T DO THAT, those that get advice often find their way to action one way or another.

Second, there is a process for a default divorce, which is what it is called when one party does not file any documents (unlike “uncontested,” which doesn’t really mean anything anymore because in California, and in most states, you can’t “contest” a divorce – though you can contest the terms of the divorce!).  Once you file the Petition and serve it on your spouse, your spouse has 30 days (again, in California.  Your state may vary in its rules) to respond by filing a Response to the Petition.  If that Response is not filed, then the Petitioner spouse can file for default.  This is the process whereby the Petitioner files all of the income, expense, assets and debt information with the court and gets to determine who will get what, including child custody, visitation, child support, spousal support, and asset and debt division.  It still must be equitable (or roughly equal), but what you consider equal and what your spouse considers equal may be radically different concepts.  So long as the proposed Judgment by the Petitioner is not too skewer in one party’s favor, the Judgment gets filed and is an order of the court.

It’s simple in theory but can be complicated to complete, especially since the forms can be a pain to fill out.  But the fact that one spouse can make all the decisions regarding the divorce generally prompts the other spouse to action.  Consider the possibility of child and spousal support being determined without your input or participation at all, or child custody and visitation.  Most spouses tend to act when faced with the actual divorce paperwork, even if they say they don’t want any part of it.

Tomorrow we’ll have Part II, where we discuss ways you can get your divorce completed if you and your spouse agree on some (or many) of the terms.

Changing child custody and visitation after the divorce is final

So, you got divorced a year ago…or two or five or ten years ago, and you want to make a change to your custody plan. Called a “post-Judgment modification,” it frequently comes up, especially when custody arrangements were made when children were little…and now they’ve grown. Extra-curricular activities, changes in residence or school, and gradual agreed-upon modifications in the custodial plan can cause problems when there’s a disagreement down the road. Or, common too is when the custodial plan just isn’t working.

I frequently get questions about problems with child custody and visitation after a couple has gotten a divorce, or completed their paternity suit and gotten a Judgment. One parent is constantly late or absent, one parent keeps changing the parenting plan, or one parent has a new boyfriend or girlfriend, and the new significant other is causing problems, or there is some problem with the child that one parent thinks is the other parent’s fault.

The answer is that there is a solution to these issues. Once your divorce is completed, or you have a Judgment, any of your orders can be modified upon a showing of a “change in circumstances.” A change in circumstances is some change from the time of your divorce/Judgment that has caused the problem. It could be a work schedule change, a new partner in your ex’s life, a change in residence, a change in the child’s school performance or behavior, or just a change in the situation. Most courts are pretty lenient when it comes to what kind of change is required.

But you do have to file a motion with the court if you can’t get an agreement with your ex about the change. I always recommend starting the easy way, which is sending a letter or email about the change you want, why you want it, and what steps you will take if the ex doesn’t agree. The steps you take may include going back to court, and you have to make that decision before you put it in writing.

If you have been through a divorce, you probably know how tough the court system can be on your wallet, your nerves, and your relationship with your ex, so think hard about whether you want to open up that can of worms. A qualified attorney can help you to assess the pros and cons of each option, and which would be the best for you and your family. If the situation isn’t working, get the advice you need to remedy the situation.

Don’t overlook these important estate planning concerns in divorce

When you get a divorce in California (and everywhere else!), there are important estate planning considerations to take into account.  In fact, these are so critical that you could end up leaving your estate to your ex spouse (ouch!), having your ex make important medical decisions for you, or – if you act hastily and without the proper information – you could get into trouble with the court system.

During Divorce:  First, when you file for divorce in California, regardless of whether it’s Alameda County, Contra Costa County, or any other county, once the other party is served, both of you become restrained from doing certain things.  One of these restraining order involves your will or trust, and prohibits you from making any changes to your will or trust once you’ve filed for divorce and served the other party.  One of the others prohibits either of you from changing or cancelling any insurance, such as life, health, auto/property, etc., or changing the beneficiaries on any insurance or other account where a beneficiary is named.  Do not make the mistake of cancelling your ex’s health insurance or changing your will after you have filed for divorce!

You may make these changes with permission from the other party or with a court order, and you may want to seek this.  Particularly if you have separate property, the last thing you want is for your ex to get it all if something happens to you. You may also want to get permission to change the beneficiary of your life insurance into a trust for your children, but you need permission for both of these actions.

One of the changes that you should make as soon as you can, and there is no court prohibition on this, is your powers of attorney.  For both health and finances, you want to make sure you designate someone other than your ex who will make decisions for you and manage your affairs should you become incapacitated.  If you’re lying in a hospital bed unconscious, do you really want your ex deciding whether to get surgery or wait to see if the medication improves your condition?

After Divorce:  Once your divorce is final, you want to make sure you change your will or trust, your powers of attorney (if you’ve not done so already), the beneficiaries on your life insurance, retirement and other accounts, and make sure you have enough life insurance for your children and long-term care insurance to care for yourself as you get older.

Want more information? Schedule a one-hour consultation by calling 925.307.6543.

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