If your family doesn't involve a spouse of the opposite sex and a couple of kids that you had together, you're not alone. Family dynamics have evolved considerably in recent decades. The term "modern family" has largely replaced "traditional family." A family can easily be comprised of an unmarried couple (of the opposite sex or the same sex), a single parent, grandparents raising their grandchildren, stepparents and stepchildren and other variations.
Some important aspects of estate planning are done outside of "traditional" estate planning documents like wills and trusts. One of these involves something called the Uniform Transfers to Minors Act (UTMA). Each state has its own UTMA. In California, it's called the California Uniform Transfers to Minors Act (CUTMA).
Many people think that they have no need for a trust in their estate plan unless they have millions of dollars in assets to pass on to their heirs and other beneficiaries. In fact, you can set up a revocable living trust even if your assets total far less than that. There are many good reasons for doing so.
For estate planning purposes, it is important to keep track of the loans and financial gifts that you give to your children while you're still alive. Do they count as an advance on that child's inheritance or not?
As we progress through adulthood, our lives tend to get bigger -- more kids, then grandkids, a larger house and more possessions. Then we reach a point where we no longer need that big house and all that stuff. The kids are grown, maybe our spouse is gone (through divorce or death). That's when downsizing becomes an attractive option.
Here in Los Angeles, most of us know somewhere in the back of our minds that our homes could be wiped out in practically the blink of an eye by an earthquake or wildfire. That's happened to many of our friends, family, colleagues and neighbors over the course of the past decades -- most recently in the fires that swept through parts of the state in November. That's why it's essential to store necessary documents -- including our estate plan -- in a safe place so that they'll survive a disaster, even if we don't.
One of the life events that motivates many people to give some thought to estate planning -- at least one element of it -- is having a child. Many parents want to plan for the worst- case scenario that they both die (perhaps in a car or plane crash) and leave their children orphans.
Are you headed for a second marriage? Are you already married for a second time? Do you have children from your first marriage? These are all important questions you will need to answer when putting together your estate plan or modifying your current plan. If you answered yes to these questions, there could be some considerations you missed that will help protect your children.
You don't have to be a billionaire to have foreign assets. Many Americans have property, businesses and other investments in foreign countries. Just as you deal with those assets separately when it comes to paying taxes, you also need to give special consideration to them as you do your estate planning.
It's essential to review your estate plan whenever a significant life event happens to you or someone in your family. You'll want to determine if any modifications are necessary to make sure that your plan reflects your current wishes.