When I was a child, I enjoyed watching the television program, The Golden Girls, with my grandmother. The show portrayed retirement to be active: full of fun escapades, late-night problem-solving chats over cheesecake with your best friends, and lots of laughter. Indeed, the adventures of Dorothy, Rose, Blanche, and Sophia challenged the stereotypical image of retirement as nothing more than sitting in a rocking chair and playing bingo (not that there’s anything wrong with that). But, as ground-breaking as the sitcom was, it did not go as far as portraying retirees competing in marathons and triathlons.
 
My dad has taken the term, “active retirement,” to a whole new level.

Traditional revocable living trusts provide that upon the death of the trust-maker, the assets of the trust are to be distributed outright and free of trust to the beneficiaries, provided that the beneficiaries are old enough to manage their inheritance.  However, this popular method of estate planning overlooks a key planning opportunity: the ability to provide the beneficiaries with a significant degree of divorce protection and creditor protection.  In order to provide such protections, the trust could instead be drafted to distribute each beneficiary’s share in a separate “beneficiary controlled trust.”  The idea is to keep the inheritance in a trust that can be completely controlled by the beneficiary but can also feature divorce and creditor protection.

In order to give the beneficiaries complete control over their beneficiary controlled trusts, it is often advisable to give the beneficiary a testamentary “power of appointment.

I am honored to have been awarded the 2017 “Golden Pine Cone” from The Golden Pine Cone as “Best Estate Planning Attorney.”  Below is the text from the paper:

“Best Estate Planning Attorney

Kyle Krasa — 704-D Forest Ave., Pacific Grove – Call for an appointment – (831) 920-0205 – krasalaw.com

Talk about local roots! Kyle Krasa’s grandfather, Karel A. Krasa, taught Czech at the Defense Language Institute while his grandmother, Zdena, worked at a Monterey cannery.

As identify theft has increased over the past decade, most people know to carefully guard personal information, especially Social Security Numbers.  People don’t give their Social Security Numbers out to third parties without caution and careful deliberation and Social Security cards are stored in safe locations rather than carried around in wallets.  Parents are even starting to monitor the credit scores of their minor children as identify thieves target Social Security Numbers that are issued at birth but whose credit is not reviewed until adulthood.  

With the recent security breach of Equifax, people might want to consider taking the extra step of “freezing” their credit reports if they have no need to use their credit in the foreseeable future.  To freeze one’s credit, all three of the credit reporting agencies – Equifax, Experian, and TransUnion – must be contacted individually.

Estate planning seems simple on the surface.  You sign a series of documents naming a responsible party to manage your assets in the event of your incapacity and directing how your assets should be distributed upon your death.  However, once you start to really think carefully about all the issues that are involved in the transfer and stewardship of your hard-earned assets, you begin to realize that an estate plan should be comprehensive and should address a multitude of detailed considerations.  One important but often overlooked consideration is which state governs your trust?

With the exception of federal tax considerations, estate planning is mostly governed by state law.  Each state has its own unique rules regarding the administration and interpretation of trust provisions.

The Department of Motor Vehicles (“DMV”) has a reputation for layers of bureaucracy.  Indeed, many people might consider waiting in line at the DMV without an appointment as a “fate worse than death.”  As challenging as it can be to deal with certain aspects of the DMV, handling the transfer of a decedent’s vehicles in California can be surprisingly efficient.

If the decedent did not have a living trust and had other assets necessitating a probate, then the decedent’s vehicles will be subject to probate which will generally be a time-consuming and costly process.  However, if the decedent had a living trust, then the process of dealing with the DMV to transfer the vehicles to the beneficiaries can be painless.

Often estate planning focuses upon the settlement of one’s estate upon death and the subsequent transfer of assets to the beneficiaries.  However, an often overlooked – and perhaps more important – aspect of estate planning centers upon incapacity.  In the event that you have a medical emergency that makes it impossible for you to make financial or personal decisions, does your estate plan provide an effective system for allowing a trusted individual to manage your assets?  Below is a summary of the options for addressing incapacity planning.

Choosing an Agent

The first consideration is choosing an agent to make decisions for you in the event of incapacity.  Choosing carefully is key to ensuring that your assets are managed for your benefit in an prudent and efficient manner.

This week on the Monterey Peninsula is commonly referred to as “Car Week.” What started in the early 1950’s with the Pebble Beach Concours d’Elegance and the Pebble Beach Sports Car Road Race has blossomed into perhaps the largest concentration of car events in the world. Locals who are not car enthusiasts often understandably do not look forward to the additional traffic. However, for self-proclaimed “car nuts” like my dad and me, it’s one of the most enjoyable weeks of the year. Car shows, car rallies, car displays, car discussions, car auctions, car test-drives, and historic car races have kept us busy and entertained for years.

When contemplating the creation of an estate plan, it is a common desire for clients to want “simple” documents.  The thought of too much complexity and the fear that long and complicated “legal jargon” will be difficult to understand makes a lot of people uneasy.  This feeling is understandable, especially since the overall goal of an estate plan is to make things as simple and as efficient as possible for loved ones who acting as “fiduciaries” and are tasked with administering an incapacitated or deceased person’s estate.  

However, once a person becomes incapacitated or passes away, all that is left to rely upon is the four corners of the estate planning documents.  “Simple” documents that do not provide precise detail can actually create problems for fiduciaries in their attempt to establish authority and administer an estate.

You probably take for granted the fact that you have the basic civil rights to make personal and health care decisions for yourself: where you are going to living, with whom to associate, what kind of health care you will receive, and what courses of medical treatment you will endure.  What happens when you are no longer able to have direct control of these decisions due to mental incapacity?  How do you maintain a degree of control over your wishes?  The following documents can help ensure that your health care wishes and preferences are carried out by trusted individuals in the event of your incapacity.

Advance Health Care Directive

Sometimes also referred to as a “health care power of attorney,” an Advance Health Care Directive (“AHCD”) serves two main purposes.  First, an AHCD allows you to designate an agent to make health care decisions for you in the event of your incapacity.  It is prudent to name at least two or three alternate health care agents in the event that the first person you name is for any reason unable or unwilling to serve in that role.