In the State of California there are currently three major ways your property will be inherited, with significant differences.

1. If you die before having a will or Living Trust created, the State of California will create a will for you after your death. If this happens, your assets will be frozen while your “estate” goes through the probate process (if your assets are over approximately $125,000 or you own any real estate). This is a public court action.  In San Bernardino county, this often takes in excess of two years and will cost 8 percent or more of the estates assets. Public announcements are made to ensure all creditors have an opportunity to collect any money owed by you at the time of your death. Also, if there are minor children, the court will determine who will act as their legal guardian. At the end of probate, the assets are then divided according to a State statute called the “Law of Intestate Succession”. This statute determines who gets your possessions after the cost of probate, and valid claims against the estate have been paid.
2. If you want to determine who inherits your property, then at minimum, you should execute a will. It follows the same probate process mentioned above, but you are able to determine who your beneficiaries are.
3. The third way of transferring your property at your death is to create a Living Trust. A trust is its own “legal entity”. After the trust is created, you transfer your assets into the trust so that the trust has ownership of your possessions. Therefore, you are no longer the legal owner of your property, the trust is, however, you still have complete control over the trust and everything that has been transferred into it. While you are the “trustee” during your lifetime, you also name a successor trustee who will take over your property at your death. However, the trust is now an irrevocable, meaning that the successor trustee can only accumulate and distribute your possessions according to your instructions. This process avoids the probate process and can be accomplished as quickly as possible. In addition, it insures your minor children are raised according to your wishes.

A living trust can only be created by an attorney, and the upfront costs are greater than the other two options, but costs to settle your estate may save your children or other beneficiaries tens of thousands of dollars and a significant amount of time during the process.
 
If you would like to learn more about creating a Living Trust and how it might benefit your specific situation, you are invited to a free Seminar featuring a highly respected estate planning attorney, Randy Spiro, on the evening of January 23, 2020.
Registration can be made at https://www.russmorrisfinancial.com/trustseminar.html or by calling 909/599-2800.

Andy Williams' 'It's the Most Wonderful Time of the Year' holds true for many. While the holidays can be hectic, this is also one of the few times of the year when families come together. Assuming that you like your family, this can be one of the “wonderful” aspects of the season. Along with food, games and laughter, these family get-togethers also present an opportune time to bring up important topics such as estate planning, life insurance and other financial matters that don’t normally get discussed. 
 
Sixty percent of Americans lack any type of estate plan. And, of those who have one, many have not discussed the details with their heirs. Truth be told, “end of life” plans are topics that many people do not want to deal with, which often leads to unfortunate circumstances such as having no plans at all and/or family misunderstandings. The pain from never addressing is usually much greater than the temporary discomfort of having “the talk” (and I’m talking about the birds and the bees…). 
 
As a Financial Advisor and Life Underwriter Training Council Fellow (LUTCF), I recommend that everyone consider having a plan for their finances, life insurance and estate. It doesn’t matter if you just turned 21 or 91. You’re never too young and it’s never too late; however, you’ll usually have more options when you’re younger than when you’re older.
 
Estate Planning
Two ways of settling an estate are a Will and a Living Trust. 
 
Everyone in California has an estate plan! Either, an individual has established his or her own Will or Living Trust (usually through the help of an attorney), or, the State of California has written a Will for you. In the latter case, you may or may not like the provisions stated in the California statues regarding persons who die “intestate”.  This simply means people who have not written their own wills.  Luckily, there is an alternative. An individual can create their own will or a living trust.
 
Many people mistakenly believe that a living trust is just for the wealthy. But this is not the case.  Other Living Trust misconceptions such as; “I’m too young to have a trust” and “I don’t own enough” prevent beneficiaries from receiving the full value of the assets they inherited. Click here to learn the differences of a Will and a Living Trust. 
 
 
Life Insurance
The cost of life insurance is determined by age and health. You will never be younger and may not be healthier than you are today. When it comes to finances, the cost of waiting can be detrimental. You’ll hear very few people say, “I wish I hadn’t started to save so early.” Whereas, one of the biggest and most frequent life regrets is that savings didn’t happen soon enough. This scenario holds true for any type of savings - whether it be for emergencies, retirement or life insurance. 
 
Sadly, I’ve had clients come to me either after waiting until their term life insurance has expired or they are in financial despair after their spouse has passed away. Situations such as these are consequences from having inadequate or no life insurance. 
 
Nearly everyone should have life insurance – whether you’re single, married or divorced. 
 
Finances & Retirement
Most Americans close to retirement have saved only 12% of what they need. Having too little retirement savings often impacts other family members. Regardless of your age, if you haven’t started saving for retirement, you need to start as soon as possible. And, if your parents are still living, you should discuss their retirement plans with them, as well. Don’t wait and don’t assume.

According to a 2015 Genworth study, 75% of all people over the age of 65 will end up spending time in a skilled nursing home. Many people think that Medicare will pay for long term care, and they will to a very limited extent under certain circumstances, but after Medicare is exhausted, most individuals will be required to “spend down” his or her estate (assets) to less than $2,000. Click here to learn more facts about Long-Term Living. 
 
These topics can be difficult things to talk about. They can be easy topics to want to ignore or put off for another day. However, I urge everyone to not wait. The cost of waiting can negatively impact you and your family later. If discussed in a thoughtful and sensitive manner, your family is likely to appreciate you taking the time to discuss this with them.  

For a complimentary financial or life insurance consultation, please contact me at 909-714-1830 or at russ@russmorrisfinancial.com.
   
 
 

Many people mistakenly believe that a living trust is just for the wealthy. But, this is not the case.  Other misconceptions such as; “I’m too young to have a trust” and “I don’t own enough” prevent beneficiaries from receiving the full value of the assets they inherited.
 
Many middleclass couples and individuals, especially those that are homeowners in California, would benefit from a Living Trust.
 
There are many benefits to a Living Trust:
 

• The assets from a Living Trust does not go through probate, a court-supervised process of authenticating the instructions and assets in a will. The average length of time for probate in the county of San Bernardino is two years. The average cost of probrate with court fees, etc., is 10% of the total value of the assets.
• A Revocable Living Trust allows a substitute trustee (a person that you assign) to manage your affairs if you become incapacitated; such as from a coma or Alzheimer's.
• A Living Trust is private. On the other hand, once filed, wills become part of the public record and can be accessible to almost anyone.
• A Living Trust can include provisions to financially protect beneficiaries that have special needs.

 
A Revocable Living Trust can be revoked or amended during your lifetime. For example, you should consider amending your living trust if:
 

• You get married or divorced
• You have, or adopt, a child
• You move to another state 
• Your financial status changes significantly 
• One of your trust beneficiaries dies 
• One of your named trustees dies or is incapacitated
• You have an AB Living Trust that written prior to 2000. Contact Russ Morris Financial if you’d like to have an existing Living Trust assessed at no charge. 

 
 Learn more about a living trust and/or to find out the options that may be best for you.
 
Click here to request more information about a Living Trust or to schedule a complimentary consultation with Russ Morris.