When Should I Create an Estate Plan in California?
Understanding When to Create an Estate Plan
Estate planning is not only for people who have accumulated significant wealth. An estate plan can help you decide what happens to your property, finances, health care decisions, and other personal matters if you become incapacitated or pass away.
For California residents, creating an estate plan can provide greater control over important decisions and help your family understand your wishes.
There is no single age or life stage when everyone should create an estate plan. However, certain life events make estate planning particularly important.
At Dosh Law, we help individuals and families throughout Placerville, El Dorado County, and surrounding Northern California communities create estate plans tailored to their circumstances and goals.
When Should I Create an Estate Plan?
You should consider creating an estate plan as soon as you have assets, financial responsibilities, or people who depend on you.
Estate planning may be especially important when you:
- Become an adult with significant financial responsibilities
- Get married
- Have or adopt a child
- Purchase a home or other real estate
- Build significant savings or investments
- Start or acquire a business
- Receive an inheritance
- Experience a divorce
- Remarry
- Experience a significant change in your finances
- Want to establish health care or financial decision-making instructions
Waiting until a major life event can leave important decisions unresolved. Creating an estate plan earlier allows you to establish a foundation that can be updated as your circumstances change.
Do Young Adults Need an Estate Plan?
Estate planning can be useful even for young adults who do not have substantial assets.
Once someone becomes an adult, parents or other family members may not automatically have authority to make certain financial or medical decisions on their behalf.
Documents such as a power of attorney and advance health care directive can identify who you want to make important decisions if you are unable to make them yourself.
Young adults who own property, have children, operate a business, or have significant financial responsibilities may have additional estate planning needs.
Should I Create an Estate Plan When I Get Married?
Marriage is an important reason to review or establish an estate plan.
Spouses may want to consider how property should be managed and distributed and who should make financial or medical decisions if one spouse becomes incapacitated.
If either spouse already has an estate plan, marriage can also be a good opportunity to review existing documents and determine whether updates are appropriate.
Should I Create an Estate Plan After Having Children?
Having a child is one of the most important reasons to review your estate plan.
Parents may want to address:
- Guardianship for minor children
- Management of assets for children
- Distribution of property
- Financial decision-making
- Health care decisions
- What happens if one or both parents become unable to care for their children
A will can be particularly important for parents because it can provide instructions regarding who should care for minor children if the parents are unable to do so.
Do I Need an Estate Plan If I Own a Home?
Owning real estate can make estate planning particularly important.
A home may represent one of the largest assets a person owns, and the way it is titled can affect how it is handled after death.
Depending on your circumstances, a living trust or other estate planning structure may be appropriate.
An attorney can review how your property is currently titled and explain options for incorporating it into your overall estate plan.
Should Business Owners Have an Estate Plan?
Business ownership creates additional estate planning considerations.
Business owners may need to consider what happens to their ownership interest if they become incapacitated or pass away.
An estate plan can help address:
- Business ownership interests
- Succession planning
- Management responsibilities
- Transfer of ownership
- Family members involved in the business
- Distribution of business assets
Business owners should consider estate planning alongside their broader business and financial planning.
Should I Create an Estate Plan After Receiving an Inheritance?
Receiving an inheritance can significantly change your financial circumstances.
A substantial inheritance may include cash, investments, real estate, or other assets that need to be incorporated into your existing estate plan.
If you receive an inheritance, reviewing your estate plan can help ensure your newly acquired assets are properly addressed and your overall plan continues to reflect your wishes.
Do I Need to Update My Estate Plan After Divorce?
Divorce can significantly affect an existing estate plan.
After divorce, it is important to review documents that may identify a former spouse or another person as a beneficiary, trustee, agent, or decision-maker.
Depending on the circumstances, you may need to review:
- Your will
- Living trust
- Beneficiary designations
- Power of attorney
- Advance health care directive
- Property ownership
- Other estate planning documents
Remarriage can create additional estate planning considerations and is another important reason to review your plan.
What Happens If I Do Not Have an Estate Plan?
Without an estate plan, California law determines how certain assets are distributed and who may have authority to make certain decisions.
Depending on your circumstances, your family may also face additional legal or administrative processes after your death or incapacity.
An estate plan allows you to provide instructions rather than leaving every decision to default legal rules.
What Documents Should Be Included in an Estate Plan?
The documents you need depend on your circumstances, but an estate plan may include:
- Revocable living trust
- Last will and testament
- Pour-over will
- Durable power of attorney
- Advance health care directive
- Beneficiary designations
- Guardianship provisions
- Other documents appropriate to your situation
Each document serves a different purpose. An estate planning attorney can help determine which documents are appropriate for your family and financial circumstances.
How Often Should I Review My Estate Plan?
Estate planning should be reviewed periodically and whenever significant circumstances change.
Consider reviewing your estate plan after:
- Marriage
- Divorce
- Birth or adoption of a child
- Death of a beneficiary
- Significant changes in assets
- Purchasing or selling real estate
- Starting or selling a business
- Receiving an inheritance
- Changes in your financial goals
- Changes in your family circumstances
Regular reviews can help ensure your documents continue to reflect your current wishes.
Why Choose Dosh Law for Estate Planning?
Estate planning involves important decisions about your property, finances, family, and future. Dosh Law provides personalized estate planning services to help California clients understand their options and establish plans that reflect their individual circumstances.
Our team can help with estate planning matters involving:
- Living trusts
- Wills
- Powers of attorney
- Advance health care directives
- Beneficiary planning
- Guardianship considerations
- Asset distribution
- Estate plan reviews and updates
Dosh Law serves clients throughout Placerville, El Dorado County, El Dorado Hills, Cameron Park, Shingle Springs, Diamond Springs, Pollock Pines, Georgetown, and surrounding Northern California communities.
Frequently Asked Questions
What is the best age to create an estate plan?
There is no specific age that applies to everyone. Estate planning becomes increasingly important when you have assets, children, financial responsibilities, or people who depend on you.
Do I need an estate plan if I am young?
You may benefit from basic estate planning documents even if you do not have substantial assets. A power of attorney and advance health care directive can help identify who you want to make financial and medical decisions if you cannot make them yourself.
Should I create an estate plan after getting married?
Yes. Marriage is an important opportunity to create or review an estate plan and ensure your documents reflect your current family and financial circumstances.
Should parents have an estate plan?
Parents should consider estate planning to address guardianship, asset management, and other decisions affecting their children.
How often should I update my estate plan?
There is no universal update schedule. However, you should review your estate plan after significant changes in your family, finances, property, or other circumstances.
Can an estate plan be changed?
Many estate planning documents can be updated when circumstances change. The ability to make changes depends on the type of document and how it was established.
Schedule an Estate Planning Consultation
You do not need to wait until you have significant wealth or reach a certain age to begin planning for the future. Creating an estate plan can give you greater control over your property, financial affairs, and personal wishes.
Contact Dosh Law today to schedule a confidential estate planning consultation with an experienced attorney serving Placerville and El Dorado County.