Is A Living Trust the Right Tool for Your Inheritance?

When planning for the future, ensuring that your assets are distributed according to your wishes is a critical step. One popular tool for estate planning in California is the revocable living trust. But is it really the best way to pass on your inheritance? Let’s explore the benefits and considerations of using a living trust, integrating insights from recent discussions and guides with information sourced from The Motley Fool.

What is a Revocable Living Trust?

A revocable living trust is a legal entity created to hold ownership of your assets. Unlike a will, which only takes effect after you die, a living trust is operational during your lifetime and can be altered or revoked at any time.

Benefits of a Living Trust

  1. Avoiding Probate: One of the most significant benefits of a living trust is that it helps your estate avoid probate. Probate is the legal process through which a will is validated and the deceased’s assets are distributed. This process can be lengthy, costly, and public. By placing assets in a living trust, you can bypass probate, allowing for a quicker and more private distribution of assets to your beneficiaries.
  2. Flexibility and Control: A living trust provides flexibility and control over your assets. You can specify how and when your beneficiaries receive their inheritance, which can be particularly useful if you have minor children or beneficiaries who may not be able to manage large sums of money responsibly.
  3. Incapacity Planning: A living trust also offers protection if you become incapacitated. If you are unable to manage your affairs due to illness or injury, your designated successor trustee can step in and manage the trust on your behalf without the need for court intervention.
  4. Privacy: Wills become public record once they go through probate, exposing your financial affairs to public scrutiny. A living trust, on the other hand, remains private, protecting your family’s privacy and financial information.

Considerations and Drawbacks

While living trusts offer many benefits, they are not without their drawbacks and considerations:

  1. Cost and Complexity: Setting up a living trust can be more expensive and complex than creating a will. There are upfront costs for drafting the trust document and ongoing costs for managing the trust. Additionally, you must retitle your assets into the name of the trust. The complexity and cost are key considerations to weigh against the benefits.
  2. Ongoing Management: A living trust requires active management. You need to ensure that any new assets acquired are transferred into the trust.
  3. Not Always Necessary: For some people, particularly those with smaller estates, the benefits of a living trust may not justify the costs and complexity. In such cases, other estate planning tools, such as a will combined with payable-on-death accounts and beneficiary designations, might be sufficient. Financial Samurai suggests evaluating your specific situation to determine if a living trust is the best solution.

When is a Living Trust the Best Option?

A living trust may be the best option if you:

  • Own property in multiple states, as it can simplify the transfer process and avoid probate in each state.
  • Have a complex family situation, such as children from multiple marriages, where you need to clearly outline your wishes to avoid disputes.
  • Want to ensure privacy for your estate and avoid the public process of probate.
  • Have minor children or beneficiaries who may not be able to manage their inheritance responsibly.

Contact a California Estate Planning Attorney

A living trust can be a powerful tool for estate planning in California. To determine if a living trust is the best way to pass on your inheritance, it’s essential to consider your unique circumstances and consult with an experienced estate planning attorney. At the Law Office of David Knecht, we have extensive experience in creating tailored estate plans that meet your specific needs and goals. Contact us today at 707-451-4502 to discuss whether a living trust is right for you and how we can help secure your legacy.

Filed Under: California Estate Plan, Estate Planning, Estates, Fairfield Attorney, Living Trust , Trust Administration Attorney , Vacaville Lawyer

Modern Estate Planning Adapting to Legal and Digital Changes

The recent litigation surrounding Lisa Marie Presley’s estate underscores the critical importance of maintaining an up-to-date estate plan. Presley’s outdated estate plan led to a legal battle, highlighting how changes in family dynamics and personal circumstances can necessitate regular reviews and updates to ensure your wishes are honored and your assets are protected. A significant aspect of this dispute involved the ownership of Graceland, now owned by Lisa’s daughter, Riley Keough. Graceland remains a valuable asset worth an estimated $400-$500 million, emphasizing the need for clear and current estate planning See https://www.hellomagazine.com/homes/499783/riley-keough-owns-graceland-how-much-worth-today/

Many individuals create an estate plan and assume it is a one-time task. However, numerous factors can render an estate plan obsolete. Changes in family dynamics, financial situations, and state or federal laws can all impact the effectiveness of your estate plan. See https://www.thinkadvisor.com/2024/02/14/why-so-many-estate-plans-are-out-of-date-jamie-hopkins/

What changes can necessitate an estate plan update?

  • Family Changes: Life events such as marriage, divorce, the birth of a child, or the death of a beneficiary require adjustments to your estate plan. Failing to update your plan can lead to unintended consequences, such as assets being distributed to the wrong individuals or loved ones being overlooked.
  • Financial Changes: Significant changes in your financial situation, such as acquiring new assets, selling property, or changes in the value of your investments, necessitate a review of your estate plan to ensure it accurately reflects your current financial status and intentions.
  • Legal Changes: The legal landscape for estate planning is continually evolving. According to Family Wealth Report, recent legislative changes can significantly impact estate planning strategies, especially concerning taxes and asset protection. Staying informed about these changes and consulting with an estate planning attorney is essential to maintaining an effective estate plan.

What are digital assets and how do they impact estate planning?

What are the steps to include digital assets in your estate plan?

  • Inventory Your Digital Assets: Create a comprehensive list of your digital assets, including login information, passwords, and security questions. This inventory should cover email accounts, social media profiles, online banking, cryptocurrency, and any other digital properties.
  • Appoint a Digital Executor: Designate someone trustworthy and tech-savvy to manage your digital assets. This person should have clear instructions on how to handle each asset, whether it involves transferring ownership, closing accounts, or archiving data.
  • Document Your Wishes: Clearly outline your preferences for managing your digital assets. This can include instructions for social media profiles, online subscriptions, and digital financial accounts. Make sure these instructions are legally documented and accessible to your digital executor.

Contact a California Estate Planning Attorney

Keeping your estate plan current requires regular reviews and updates. Partnering with an experienced estate planning attorney can help ensure that your plan adapts to changes in your life and the law. At the Law Office of David Knecht, we offer personal advice, legal experience and ongoing support. Contact us at 707-451-4502.

Filed Under: Estate Planning, Living Trust , Living Will, Probate Lawyer, Trust Administration Attorney 

Estate Planning for Long Term Care

Did you know that Medicare does not cover nursing home care after one hundred days? This article will provide some basic information about why you need to plan for possible nursing home care and some strategies for doing so, with information published by the California Advocates for Nursing Home Reform, which can be found here: https://canhr.org/overview-of-medi-cal-for-long-term-care/

Medi-Cal is a source for long-term care.

  • A common misconception is that Medicare covers long-term care. In California, Medi-Cal is a need-based program designed to help people pay for medical care such a skilled nursing facility or nursing home.

Medi-Cal eligibility requirements have changed as of January 1, 2024.

  • One piece of good news for many California residents, is that Medi-Cal will no longer count assets to determine eligibility. California is the first state to make this change to Medicaid eligibility.

Medi-Cal is income only now.

  • Now eligibility is determined by income, which at present is $1732 per month max. See
  • If a Medi-Cal beneficiary’s available countable income exceeds their maintenance needs level, then an otherwise eligible Medi-Cal beneficiary has a share of the cost.

How does a trust benefit a person who may need Medi-Cal coverage?

  • An article published by the Lake County News provided a good summary and examples of how a trust may impact a person seeking Medi-Cal eligibility, and a few highlights are quoted below. For the full article, see https://lakeconews.com/news/78818-estate-planning-trusts-and-no-asset-limit-medi-cal
    • A trust, whether revocable or irrevocable, minimizes a person’s available countable income and share of cost. Income received by a trust (with income producing assets) does not count as income to the trust beneficiary for determining Medi-Cal share of cost.
    • Direct distributions by the trust to the beneficiary count as available income.
    • But, if the trust were instead to pay a portion of a person’s support and maintenance needs, called, “in kind support and maintenance,” but not 100% of any support/maintenance cost (e.g., rent), then such payments do not count for Medi-Cal share of cost.
    • If the trust were directly to pay for other expenses and purchases other than certain necessities of life (buying clothes) then such other trust purchases do not count as income for share of cost.

Contact an Experienced Estate Planning Attorney

Planning for and navigating the complexities of Medi-Cal can be a daunting process for some California residents, but planning for long term care can be a crucial step in safeguarding your future. At the Law Office of David Knecht, we have extensive experience in all aspects of estate planning and can help you prepare an estate plan that is right for you and your loved ones. Estate planning is like setting the coordinates for a journey, and it will help create a more confident and smoother ride through the later part of your life. Contact us today at 707-451-4502.

Filed Under: Estate Planning

The Danger of Declining Estate Planning Rates

Do you have an estate plan? If not, you are not alone, and you may be responding to the latest trends affecting Americans and their estate planning practices. Statistics show that Americans are responding to financial trends including income inequality and rising inflation, and these factors are having an impact on estate planning nationwide.

This article will discuss the statistics and trends and potential impact these may have, with information derived from Caring.com’s 2024 Wills and Estate Planning Survey and an article about the danger of declining estate planning rates originally published by Forbes. See https://www.caring.com/caregivers/estate-planning/wills-survey/ and https://www.forbes.com/sites/matthewerskine/2024/03/20/the-danger-of-declining-estate-planning-rates/?sh=2db3b6924e33

What are the main estate planning trends?

  • As reported in a survey by Caring.com, for the first time since 2020, the number of Americans with a will has declined.
  • Only 32% of Americans have an estate plan in 2024.
  • security for loved ones.
  • For business owners, estate planning ensures business continuity.
  • For art lovers, a plan can preserve the value of art collections.
  • Estate planning can minimize taxes, preserve your legacy and facility philanthropic goals
  • Estate planning can involve more than financial assets.
    • It can control healthcare decisions
    • Designate what happens with your digital and social media assets
    • Provide guidance on how children are looked after in the event of an emergency

What can you do to address these estate planning concerns?

  • The obvious first step is to get your own affairs in order. At the Law Office of David Knecht, we have extensive experience in all aspects of estate planning, and we can help make this process easy. To get started or to freshen up a preexisting plan, contact us today at 707-451-4502.
  • Talk to friends and family. If you estate plan is prepared, talk to your loved ones about how they can get steps to be prepared for the future.
  • Get involved in your community and talk about estate planning with new friends and associates. You can look for opportunities to serve in local communities, on sites such as https://www.cityofvacaville.gov/i-want-to/volunteer

Estate Planning Does Not Have to Be Intimidating

Estate planning can be complicated and it does involve facing the inevitable occurrence of your passing on, but it does not have to be intimidating. All it takes to get started is one call to your estate planning attorney, and we will help you do the rest.

  • This is a 6% decline from last year.
  • 40% of people without a will attribute that to not having enough assets to leave to anyone.
  • The study found 16% notable decline among lower-income Americans.

What are other surprising niche trends?

  • Around 85% of successful business owners have outdated estate plans.
    • This can potentially lead to unintended consequences due to changes in tax law and personal circumstances.
  • Only about 10% of ultra-high net worth individuals with significant art collections have planned for their transfer.
    • This can potentially risk disputes among heirs or mismanagement of the collection.

Why is estate planning important?

  • Estate planning is crucial for distributing assets as to one’s wishes and providing financial security for loved ones.
  • For business owners, estate planning ensures business continuity.
  • For art lovers, a plan can preserve the value of art collections.
  • Estate planning can minimize taxes, preserve your legacy and facility philanthropic goals
  • Estate planning can involve more than financial assets.
    • It can control healthcare decisions
    • Designate what happens with your digital and social media assets
    • Provide guidance on how children are looked after in the event of an emergency

What can you do to address these estate planning concerns?

  • The obvious first step is to get your own affairs in order. At the Law Office of David Knecht, we have extensive experience in all aspects of estate planning, and we can help make this process easy. To get started or to freshen up a preexisting plan, contact us today at 707-451-4502.
  • Talk to friends and family. If you estate plan is prepared, talk to your loved ones about how they can get steps to be prepared for the future.
  • Get involved in your community and talk about estate planning with new friends and associates. You can look for opportunities to serve in local communities, on sites such as https://www.cityofvacaville.gov/i-want-to/volunteer

Estate Planning Does Not Have to Be Intimidating

Estate planning takes some time, and it does involve facing the inevitable occurrence of your passing on, but it does not have to be intimidating. All you need to get started is one call to your estate planning attorney, and we will help you do the rest.

Filed Under: Estate Planning, General, Living Trust , Living Will, Trust Administration Attorney , Vacaville Attorney, Vacaville Lawyer

What is an Executor for Estate Planning in California

With the recent passing of O.J. Simpson, the executor of his estate has been in the news. This article will explain some basics about what an executor is and what duties they perform, with examples from the O.J. Simpson estate. (Note: O.J.’s will was filed in Nevada, but for the basic principles relating to executors, this article does not differentiate between California and Nevada law.)

What is the definition of an executor?

  • An executor is a person named in a Will and appointed by the court to carry out the dead person’s wishes. The executor is also called the personal representative of the estate.

Who is the executor in the O.J. Simpson case?

  • J. Simpson’s final will was filed in Nevada, following his death after a battle with cancer.
  • Simpson’s longtime Las Vegas attorney Malcolm LaVergne was named as Simpson’s personal representative and executor of the will and testament, according to court records.
  • His property was placed in The Orenthal Simpson Revocable Living Trust.

One of the general duties of an executor is to handle creditor claims.

What debts are at issue with the O.J. Simpson case and how are they being managed?

  • LaVergne, the executor in the Simpson case, addressed the $33.5 million civil judgment awarded to the families of Simpson’s ex-wife, Nicole Brown Simpson and her friend Ronald Goldman by a California jury in 1997. He was sued by their families for wrongful death and found liable by a civil jury, which puts them in the position of creditors to Simpson’s estate.
  • LaVergne said that the families would be put in the “pecking order” of creditors behind the IRS.
  • In a phone interview, he said he would fight any payout from the estate to the Golman family.
  • As per the CNN article, he told reporters: “It’s my hope that the Goldmans get zero, nothing,” LaVergne told the outlet. “Them specifically. And I will do everything in my capacity as the executor or personal representative to try and ensure that they get nothing,” he said.
  • In a follow up interview he backtracked, saying that perhaps he had been too harsh against the Goldmans: “Now that I understand my role as the executor and the personal representative, it’s time to tone down the rhetoric and really get down to what my role is as a personal representative.”
    • See https://www.yahoo.com/news/o-j-simpson-cremated-estate-192531874.html

What other executor-related issues that have arisen in the O.J. Simpson case?

  • According to an NBC News article, republished at yahoo.com, O.J.’s executor has made statements about a few other estate matters.
  • LaVergne has been contacted by scientists requesting access to O.J.’s brain to study CTE, which is chronic traumatic encephalopathy, a degenerative brain disease that has been studied in former football players.
  • LaVergne is refusing these requests and O.J. will be cremated.
  • Simpson’s will asked for money to be retained to create a suitable monument at his gravesite, so this will be a responsibility for his executor.
  • His will also indicated that his wishes were that there should be no litigation or dispute, and any beneficiary or heir who did not follow that dictate would receive only $1.00 in lieu of any other interest to which they were due.

Contact an Experienced Estate Planning Attorney

At the Law Office of David Knecht, we have extensive experience in all aspects of family law and can help you complete your own estate plan or assist you with properly administering the estate of a loved one who has passed. Contact us today at 707-451-4502.

Filed Under: Estate Planning, General

Estate Planning Lessons to be Learned from the Matthew Perry Trust

Matthew Perry, the beloved Friends actor who played Chandler Bing, passed away more than four months ago, and now details about his estate are emerging. This article will highlight some of the interesting aspects of the late actor’s estate, and suggest helpful takeaways that can be learned from this high profile trust example. See for more details: https://people.com/matthew-perry-will-names-executors-estate-1-million-trust-named-after-woody-allen-character-8607717

You can personalize your trust.

  • One lesson that can be learned from the Perry Trust is that you can personalize your trust to send a message to loved ones.
  • People reports that his wishes were that his trust be called the “Alvy Singer Living Trust.”
  • He named his trust after Allen’s alter ego in “Annie Hall,” which had special meaning for Perry because he once recalled that watching “Annie Hall was one of his favorite memories with his mother.

 A trust can be used to protect the privacy of the value of the estate.

  • One of the advantages of a trust is the privacy that it affords the deceased and the family of the deceased.
  • Documents valued Perry’s personal property at about $1 million dollars, but that figure excludes the assess that were already in the trust.
  • This means that his true wealth was kept private from the public, which can be important for anyone who wants to protect their privacy.

 Estate planning can include “obvious” provisions just to be sure.

  • Perry’s estate plan has an example of including a provision that is somewhat obvious just to be sure.
  • He did not have any biological children.
  • However, his will reportedly included a provision that any biological children would not be entitled to anything. We can only speculate why he included that in there, but one might guess it would be to shut down the incentive for any false claims from someone claiming to be a child.

Even though a trust is typically more convenient to administer than a will, it may still require some processing.

  • A trust is often used because it avoids probate proceedings, so it can be faster and less hassle than a will. However, as the Perry case shows, there may be some time and administration involved.
  • Perry died on October 28, 2023 in his Los Angelous home, and detailsa re just emerging in March of 2024.
  • Perry’s executors are reportedly Lisa Ferguson and Robin Ruzan, and they have had to roll over $1 million dollars of personal property into the living trust. 

Contact an Experienced Estate Planning Attorney

For Matthew Perry friends and fans, his early death was a great loss, but from all appearances he successfully planned a smooth transition of his assets to loved ones so that his wishes could be carried out now that he is gone. At the Law Office of David Knecht, we want to help you prepare for the unexpected. We have extensive experience in estate planning and can help you create a plan that is right for you and your loved ones.  Contact us today at 707-451-4502.

Filed Under: Estate Planning

Decanting a Trust in California

If you are interested in a trust as an estate planning tool, you may have heard the word “decanting” and wondered what it means and why you might need it as a strategy. 

What does decanting mean?

  • The word “decanting” traces its roots to winery, where a person would decant a wine by pouring it from it’s bottle into another container.
  • Similarly, a 2019 California law allows you to change the terms of an irrevocable trust by “pouring” trust assets from an old trust instrument into a new trust.  
  • This helps you to leave behind the unwanted terms of the old trust, just as you would leave behind the impurities in the wine. 

What law changed the rules for trust decanting? 

  • The California Uniform Trust Decanting Act became effective January 1, 2019. 
  • Before this change, modifying an irrevocable trust was difficult, but now decanting provides an easier way to modify an irrevocable trust. 

How is decanting accomplished?

  • In general, you must still notify trust beneficiaries of the proposed changes and allow them the opportunity to object to the changes. 
  • You must also stay within the limits of which the trust terms can be changed, which depend on the Trustee’s authority in the original trust. 
  • For example, you might want to eliminate beneficiaries, but you wouldn’t be allowed to use this rule to increase Trustee compensation. 

Contact an Experienced Estate Planning Attorney

There are pros and cons to decanting, and it needs to be accomplished properly. At the Law Office of David Knecht, we make it our business to stay current on regulatory changes that impact estate planning. We will customize a plan to help you find creative solutions to meet your estate planning goals, and we will work with you to keep your plan up-to-date and responsive to regulatory changes. Contact us today at 707-451-4502. 

Filed Under: Estate Planning, Estates

Estate Planning Ideas: Transfer Wealth by Helping Your Children Buy a Home

People commonly think of estate planning as only being relevant after you have passed, but there are many tools for transferring wealth during your lifetime. This article will summarize three ways that you can transfer wealth to your children through helping them purchase a home.

Lend money as an intrafamily loan. 

  • A family loan can greatly benefit family members purchasing a home because they can avoid the high interest rates that are currently market standard.  
  • One common challenge is that a loan to one family member may strain relationships with other family members who were not given the opportunity for an intrafamily loan. 
  • Another challenge to be aware of is the complication of a intrafamily loan to a married family member who may subsequently get divorced.

Give money as a gift. 

  • A gift can be used outright or in the form of loan forgiveness. 
  • The lifetime gift exemption is cumulative and applies to all recipients, and under federal life that amount is $12.92 million per person, or $25.84 million for a married couple. (Numbers scheduled to change in 2026.)

 Co-sign a loan. 

  • Another common way for a parent to assist is to act as a guarantor or co-signer on a loan. 
  • This helps a child who may not have established credit and may help the child secure a better loan. 
  • The risk is that the parent is likely obligated under the terms of the loan if the child does not pay. 

Contact an Experienced Estate Planning Attorney

If you are interested in learning more about methods and tools for transferring wealth during life or after death, contact us at the Law Office of David Knecht. We have extensive experience with estate planning and can help update an old plan or create a new one that meets your needs. Contact us today at 707-451-4502. 



Filed Under: Estate Planning, Estates

5 Common Estate Planning Mistakes to Avoid

It’s a famous phrase that failing to plan is the same as planning to fail, and this anecdote is especially true in the realm of estate planning. The most important step you can take with an estate plan is the first one: getting started, and therefore, the most important estate planning mistake of all would be to do nothing. But what are the other common mistakes people make in estate planning? This article will summarize typical estate planning mistakes to avoid with source material based on.

Failing to prepare for incapacity. 

Many people only think of an estate plan as how to divide their assets after they die, but preparing for incapacity is very important, as you never know whether disease, accident or age may take away your ability to care for yourself. It should identify the people you want to authorize to make important decisions on your behalf with regard to your money, your healthcare, your end of life wishes, etc., and then the estate plan should enable them to do so. 

Not including funeral and burial wishes. 

Don’t assume your family members know your wishes. If you have strong feelings about certain issues, such as cremation vs. burial etc., those wishes need to be communicated in your estate plan. 

Not considering tax implications of transferring property. 

The famous saying that nothing is certain except death and taxes is true, but different estate planning tools have various tax consequences, so it’s important to think through the tax implications when your estate plan is created.

Not naming contingency decision makers. 

The unexpected happens, so you need back-up decision makers in your plan. You and your spouse may perish in an accident together or a child may predecease you. Don’t assume that your family will remain unchanged as your estate plan ages. 

Not keeping track of beneficiary designations. 

It is important and can be somewhat challenging to make sure your estate plan matches the information in all your accounts and assets. Make sure that you keep the information relating to each specific asset matching your intentions. 

Contact an Experienced Estate Planning Attorney

An excellent way to avoid making estate planning mistakes is to use the services of an experienced estate planning attorney. Here are the Law Office of David Knecht, we have extensive experience with estate planning and will help you think through the potential challenges or various scenarios that may arise to create a plan that will accomplish your goals. Contact us at 707-451-4502.

Filed Under: Estate Planning

Estate Planning For Parents with Care-giver Children

According to an article published by allabouttheelderly.com, approximately 17% of adult children provide care for an elderly parent at some point in their lives. The article further projects that by 2060, the population of people over 65 in the United States will have doubled. 

With these statistics in mind, you may want to consider in your estate planning the possibility of an adult child being your caregiver in the future, the ramifications of the possibility for your asset distribution, and the ways you can plan ahead to promote family harmony in various future scenarios. This article will explore a few of the questions that you can consider with ideas drawn from an article published on yahoo.com.

Preparing for the possibility that an adult child would be caring for a parent in the parent’s home. 

  • How long after death does the child have the right to live in the home?
  • Do you want to give the child a greater share of the assets after you die to compensate the child for their extra effort in your care?
  • Does your estate plan empower the child you plan to care for you to make decisions on your behalf?
  • What protections are in place to protect the adult child from fatigue, which in some cases can lead to elder abuse?

If the child or children are unwilling or unable to care for the parent. 

  • If you are planning on care from family members in the future, do you have a back-up plan in case they are unable or unwilling to care for you?
  • Is there a care facility or nursing home that you prefer that you want to designate as the care facility for when you are incapable of making decisions for yourself?

 Communicating estate planning to your family members. 

  • Communicating with family members about your and their preferences for the future can be as important as setting up the documents because you can get the support of family members in advance and resolve concerns or arguments while you are alive and well.
  • There are many tools available for estate planning and talking through the various choices with your family members can help you choose the right tools for your specific situation.

Contact an Experienced Estate Planning Attorney

The uncertainty of the future can invoke anxiety and fear, but estate planning can help give you peace of mind. When you create the right plan for you and your loved ones, then you can have the confidence to know that you are prepared for all possibilities. At the Law Office of David Knecht, we have extensive with estate planning and enjoy helping people gain the peace and confidence that comes from a properly drafted and personally customized estate plan. Please contact us at 707-451-4502. 

Filed Under: Estate Planning
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