Los Angeles Estate Attorneys Explain Asset Planning and Asset Protection

Estate planning is all about you, your family, and your personal estate. Through effective estate planning and administration, you can live on, in and through your heirs, your estate, your hopes, plans and dreams to shape the future long after you're gone. It's important to overcome the reluctance to spend time and money for proper estate planning and administration because it's about taking responsibility to ensure that your estate everything you own and control is preserved and protected through asset protection and used for the benefit of those you love.
Asset protection is particularly important if you are running a business or own even a minority percentage of a business. Often, the largest and most important revenue-producing asset is your ownership in an ongoing business. Proper estate planning encourages you to concurrently address both your personal and your company's risk management plans because they are intimately linked and have a continuous impact on one another through both asset protection and estate planning.
WHAT IS "ESTATE PLANNING?": The term "estate planning" does not describe a single, simple activity. Rather, it comprises a range of measures designed to achieve two major goals. The first and foremost of these is to ensure that the property which has been accumulated over a lifetime is used and distributed through estate planning, both prior to and after death, in a manner which is in keeping with your desires. The second is asset protection, to help preserve this accumulated property by taking steps to minimize the taxes that can cut into an estate, both prior to, and upon your passing.
Virtually every person in the country who has income and owns property needs estate planning and asset protection in some form or another. A common misconception, and subsequent cause of reluctance to become involved, is the notion that estate planning and administration and asset protection is only for persons with large estates to administer. While those who gain the most are generally those who have already accumulated substantial estates to administer, many property owners wrongly feel that they do not own enough assets to make estate planning and asset protection worthwhile.
When it comes to basic estate planning and administration, time and time again we run into five very common mistakes. Learn what they are and how to avoid them when making or updating your estate plan for estate planning and asset protection purposes.
1. FAILING TO MAKE AN ESTATE PLAN: When it comes to basic estate planning, we've found that many consumers simply avoid it. The typical reasons why range from fear of death, to misperceived expensive costs, to complicated family situations related to asset protection. Suffice it to say that without estate planning and administration, you'll be leaving your loved ones with unnecessary burdens, and they'll end up spending thousands of dollars (that could have been saved by creating an estate plan) figuring out what should happen if you become disabled and what to do after you die. Avoid this estate planning mistake. Begin your estate planning early, while you still have your wits about you, and then review and update your estate planning and administration objectives frequently to insure that it will work the way you intended when it's actually needed, especially from an asset protection standpoint.
2. FORGETTING ABOUT THE LITTLE THINGS: When it comes to basic estate planning and administration, we've found that many people overlook making an estate plan for their personal effects, including jewelry, art work, and collectibles (this falls generally into the category of asset protection). They simply assume that their loved ones will be able to agree on how to divide it all up without estate planning and administration. In our experience, these things are what people argue over the most! We've seen numerous cases where siblings or family members litigated for years over the "stuff" left in their loved one's house. They typically end up spending $50,000 or more in attorney fees to fight over $5,000 or less worth of personal effects. This is a problem estate planning and administration could have solved very easily. Don't let this estate planning mistake happen to you and your loved ones prepare an estate planning and asset protection strategy today. Ask what everyone really wants and make a simple but smart estate plan to achieve those objectives, and protect assets.
3. FAILING TO FUND YOUR ESTATE PLANNING REVOCABLE LIVING TRUST: When it comes to basic estate planning and administration, we see this mistake repeatedly - people who don't understand the importance of funding their revocable living trust. If you've taken the time and spent good money on asset protection creating a solid foundational estate planning and administration strategy, then don't stop there, or your assets will end up in a court-administered guardianship if you become incapacitated, and they'll have to go through probate after you die, your estate planning and asset protection efforts will have been wasted. Instead, take the time to fund your estate planning rust and update your beneficiaries of your life insurance and retirement accounts. Otherwise, you'll have committed one of the worst estate planning and administration mistake and your estate planning and asset protection plan will only be worth the paper it's written on.
4. CHOOSING THE WRONG FIDUCIARIES: When it comes to basic estate planning and administration, this is another unfortunate mistake we see over and over again - people who choose the wrong people or institutions to serve as their Personal Representatives, Successor Trustees, Attorneys in Fact, and/or Health Care Agents. In fact, choosing the right fiduciaries for your estate plan is just as important as creating the plan in the first place, since your estate planning won't work as you intended if your fiduciaries aren't capable of doing the jobs you've given to them. Avoid this estate planning and administration mistake by working with your estate planning and asset protection attorney to choose the right people or institutions for the right jobs.
5. MAKING YOUR ESTATE PLANNING AND ASSET PROTECTION TOO COMPLICATED: When it comes to basic estate planning and administration and asset protection, some people go over the top and make their estate planning so complicated that it will take over a dozen lawyers and accountants and a judge, not to mention hundreds of thousands or even millions of dollars, to unscramble the estate planning and make it work. An overly complex estate plan will not only frustrate your loved ones, but it will also tie the hands of your fiduciaries since they won't be able to do their jobs without seeking expensive estate planning and administration professional advice on these and asset protection issues. Avoid this estate planning mistake by working with your estate planning and asset protection attorney to create a practical and common sense estate planning objective that will work as you intended but without the need for advice from multiple estate planning attorneys and accountants.
Of course these, and most issues related to estate planning and administration, along with asset protection are complex and should be discussed with a qualified estate planning attorney such as McFarlin & Geurts, LLP. Our practice areas include all of Southern California including Orange County estate planning, Newport Beach estate planning as well as Los Angeles and San Diego. Many of our clients drive from hours away to seek our knowledge and experience.