DIY Estate Planning

For the last fifteen years, my law firm's motto has been "Feel Good, Not Guilty" because so often people who call my office start out by telling me how guilty they feel for not having an estate plan. But here's the thing -- more than half of Americans in most surveys don't even have a Will or an estate plan in place, let alone a living trust with estate tax planning. So, the people who actually make the call and get into my office are exceptional, not irresponsible.

It's really hard, given the hassle and stress of day-to-day life in Silicon Valley, to make time to do estate planning--believe me, I get it. And although I'm a firm believer in the value of working with an experienced attorney to put together a living trust with tax planning, if a person doesn't have time, or the money, to do the whole thing right now, that shouldn't be a barrier to putting the basics in place. Here's a list of four simple things that anyone can do, in a weekend, that will go a long way towards protecting their family and their assets. None of the options below are going to put me out of business--I know that the advice and counsel I offer my clients, as well as my decades of experience in writing estate plans, administering trusts and probates, can be invaluable in helping them to craft a sophisticated plan that will meet their needs for generations to come. At the same time, I also believe that the basic legal documents can and should be accessible to anyone who wants to put them in place. Here's a few suggestions for DIY estate planning.

Create a Will

A Will is the simplest estate plan. A Will can name guardians for minor children, state who should get your assets if you die, and put in place a simple way to manage money for children to age 25. There are no magic words required for a Will to be legally valid, as long as it clearly states your intent to create a last Will and Testament and you sign it in front of two witnesses who do not benefit from the Will. I don't recommend that you write one on the back of a napkin (but honestly, that could actually work). Instead, I recommend two simple online options:

1. The California State Bar offers a free statutory Will at their website which you can print out, fill in, and sign.

2. Nolo's Quicken WillMaker is an online program that asks you questions, interview style, and creates a Will that you can print out and sign. For $55 dollars it's a good alternative for someone who wants a Will that's a bit less basic than the State Bar's form.

Create a Durable Power of Attorney

A Durable Power of Attorney appoints an Agent to manage your finances should you become incapacitated and unable to manage them yourself. The person you appoint will be able to conduct your banking, write checks, make deposits, make decisions regarding your investments and even sell property if needed. Your Agent will be able to take care of your home, deal with your retirement accounts, and even change your beneficiary designations if necessary. If you do not have a power of attorney, but become incapacitated, your family will need to have a court appoint a conservator to manage your affairs. Obviously, you want to make sure to name someone that you trust to have access to your assets and who will take care of things for your benefit alone. Many nonprofits publish links to a California statutory power of attorney: here's one.

Create an Advance Health Care Directive

An Advance Health Care Directive appoints an Agent to make medical decisions for you if you are unable to make them for yourself, either because you are unable to speak or because you are unable to understand the risks and benefits of the decisions you are being asked to make. The Advance Directive also allows you to state your wishes for end of life care if you are being kept alive by artificial means. Your Agent's job will be to carry out those wishes, not to substitute their own for what you've said you wanted. Many large medical providers (like Kaiser) have their own forms that you can fill out for free. The California Medical Association sells one online for $6 if you can't get one from your doctor.

Appoint a Beneficiary for Your Financial Accounts

It's important to name your loved ones as your beneficiaries on financial accounts that require beneficiaries, including life insurance policies, retirement accounts, and payable on death or transfer on death investment and bank accounts. And be sure to review these accounts regularly. Life circumstances change, children are born, divorces and remarriages can all affect your beneficiary choices. My clients are often surprised to be told that these beneficiary designations trump whatever a Will or living trust says -- the assets held in a beneficiary account go only to the named beneficiaries.

If you or anyone you know has questions about how to get started doing basic DIY estate planning, please feel free to get in touch or to share this article with them.