Estate Planning Overview

Author: Rebecca L. Van Loon

Updated: 4/21/2020

Below is a summary of the various estate planning documents, the purpose of each document, and how putting your estate plan in place will help protect you, your family, and your assets. 

Durable Powers of Attorney

Powers of attorney, including durable powers of attorney for financial matters and advance health care directives, are commonly used estate planning tools.  These documents are designed to avoid the need for a public, court‑supervised conservatorship proceeding if you become ill or otherwise incapable of acting for yourself, temporarily or permanently.

Health Care

Advance Health Care Directives appoint an agent to make health care decisions for you.  Generally, advance health care directives are effective immediately; however, no one can use an advance health care directive to require or deny medical treatment against your wishes, if you are able to express your wishes.  You also may include directions regarding end-of-life care, organ donation, burial, and cremation.

Financial Matters

Durable powers of attorney for financial matters appoint an agent to make financial decisions for you and may grant broad powers over all financial transactions, including powers to sell property, to borrow money, to add or withdraw funds from your bank accounts, to add or remove items from your safe deposit box, to make gifts, to amend your trust, and to deal with taxes, insurance, and all other financial matters.  These financial powers become effective only if you become incapacitated, unless you choose to make them effective immediately. 

What is Probate?  What if I don’t have a Will or Trust?

Probate is the court proceedings necessary to transfer the property you own at death not held in a trust and not otherwise held jointly or subject to disposition by beneficiary designation.  Probate proceedings can be lengthy, and they are public and expensive.  As an example of the expense, the minimum attorney’s fees set by statute for an estate with a gross value of $500,000 is $13,000, and the executor is entitled to the same amount, for a total of $26,000.  This fee is set as a percentage of the value of the assets in the estate and does not include court costs, appraisal costs, or other administrative expenses.  Further, if there are unusual claims or assets to be handled or if tax work is involved, the attorney and executor may ask the court to award additional fees for “extraordinary” services.  In this event, the fees could be significantly higher.

If you do not have a Will or Trust, your estate will pass by “intestate succession,” which means that your assets will pass upon your death to your heirs at law as set forth in the California Probate Code.  This generally means spouse, children, more remote descendants, parents, siblings, nieces and nephews, or more remote family members depending on both the character of your assets (separate property, community property, or quasi-community property) and who survives you.

Revocable Trust

Probate can be avoided by transferring all of your assets to a revocable trust during your lifetime.  The trustee of the trust is the legal owner of the assets and is required, by law, to manage and distribute the assets in accordance with the terms of the trust, both during your life and upon your death.  You may be the trustee of the trust during your lifetime and the successor named in the trust takes over if you resign, become incapacitated, or at your death.

The transfer to the revocable trust has no income or property tax effect during your lifetime.  You continue to report all income on your personal income tax return as if you owned the assets directly, rather than through the trust.  While you are living, you may remove property transferred to the trust at any time.  You also may amend the trust terms or revoke the trust entirely at any time.  At your death, your trust will govern the disposition of your assets among your family or other beneficiaries.  In addition to designating your trust beneficiaries, your trust can require that assets remain in trust until a beneficiary attains certain ages or for their lifetime.


Even if you establish a revocable trust, it is still necessary to have a Will to dispose of any assets that were not transferred to the trust during your lifetime, not held jointly, or not subject to a beneficiary designation (for example, retirement accounts or life insurance policies).  A “pour‑over” provision in a Will provides that any assets subject to your Will will be added to and distributed in accordance with the terms of the trust. 

A Will is also necessary to nominate guardians for your children.  If you were to pass away while any child is still a minor (under the age of 18), the court would appoint a guardian for that child to care for the child and handle day-to-day decisions (guardian of the person) and to manage the child’s finances (guardian of the estate). 

This is just a general summary. Your unique circumstances and needs should also be addressed. Please feel free to give us a call if you have further questions/concerns.

***The information provided in this article is for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney to obtain advice with respect to any particular issue or problem.***