0:00 hello and welcome to trust and Estates weekly I'm your host Kevin bmel and we are here every Monday morning at 10:00 a.m. Pacific time to talk about matters relating to estate planning trust and probate Administration both from the standpoint of handling your own financial matters and for professionals who were involved in helping you do that or professionals who are considering getting involved in this Arena so today our topic is um for
0:35 um primarily I would say you know young adults for people who are really just starting out in life maybe recently got out of college or they're they're out of high school and and they're in their first job um may not be married yet um don't have children yet that sort of thing and um and as a result um may not think that they have anything to be concerned about in this Arena and so I'm going to talk about a number of issues that um even
1:13 for people who were just starting out um they uh you know probably need to take a look at so so there you are if you're just starting out right trust in Estates weekly um so let's just let's uh Jump Right In and of course everything we do on the way to wow shows relates to the three pillars of attainment um we're dealing here in the finances section as we finances uh Realm of the Pursuits pillar as we normally do all right so um no spouse no family no house that that you
1:49 know just starting out that's that's probably the case um it may be like I said you just recently um got out of college you're starting your first job or you're done with high school you didn't go to college um but in fact um you know you're you're starting to make uh you know some money now um but you don't have any um major assets so you may have a car um a few things like that um but but you know for for most people a house is their major asset and um um
2:26 so you don't you know don't have a house yet maybe don't want one okay so um what is it that you have to be concerned about well um there may be several things first of all despite having no large assets you may still have some small assets okay you may have some bank accounts um you may have some valuable Collectibles um if you uh collected uh comic books if you collected um uh what do they call it uh you know
3:03 different um um sort of fan items um action figures those sorts of things um some of those collections while they may not be you know worth um you know hundreds of thousands of dollars or even in the high-f five figures you may have a collection that's worth who knows 10 20 $30,000 um that's not insubstantial um and and it's something that um you you know you'll you probably don't want just thrown away um if you were to
3:38 you know unfortunately pass away so um you know for for those kinds of issues um you you do want to do at least some basic estate planning now you may say well wait a minute uh you know I'm young I'm healthy I don't have to worry about um dying and and and yes of course the chances that you're going to die are very very low however they're not zero um that that's just the reality and and by the way estate planning isn't only about planning for when we die it it is
4:14 also planning for um when we might become incapacitated so if you engage in any kind of um higher risk Sports skiing snowboarding um those s those sorts of things um surfing any of those um raise the the risk that you might get injured in a way where um you're no longer able to work you're no longer able to take care of yourself um and so then you know what's what's going to happen so rather than leaving yourself at the mercy of
4:52 whomever it is um might uh you know step in to help you whether it's your parents whether it's a sibling um whether it's a you know a significant other girlfriend or boyfriend whatever um you know you you're you're well advised to give some thought to this and uh make some basic plans on what you want to happen Okay so in that vein with respect to any property that you have it's a good idea to have a will
5:28 now a a will would you know if if when you if your will has to be enacted so to speak it will require going through probate okay that's a court action now if you have a very small estate then um perhaps the probate won't cost very much um but it's better than um leaving all of this to chance and by the way if you die without a will as I've spoken about in other shows if you die in testate no will no trust no nothing that doesn't
6:04 mean that the court wouldn't get involved the court may get involved so let's say you've got that um uh comic book collection or Collectibles collection that's worth $340,000 okay and now um you know the the people maybe you have a couple of siblings and they never cared for comic books or Collectibles but they sure like the money right so what's going to happen well um it could be if there's any kind of dispute it's going to end up in court anyway okay so by by drawing up
6:40 a will and naming who gets what or um just you know naming percentage shares um to whomever you want to receive it or excluding specifically excluding someone from receiving any of the value of your estate all of those can be put into a will pretty simple to draw up not very expensive and that way you can be reasonably assured that your wishes will be carried out a after you die um
7:15 and you know you you've taken the best step you can to avoiding a dispute between um the people that you leave behind Okay so drawing up a simp Le will um a lot of times even paralal can do it these days um there are forms online I I wouldn't necessarily say if you're if you're not familiar with these kinds of things to do it yourself um but you could certainly draw something up yourself and then run it by a lawyer um just you know for a review to make sure
7:51 everything is the way you want it and make sure you haven't inadvertently left something out or written up something incorrectly so that it'll actually work differently than what you anticipate okay so again can be a very inexpensive way to make sure um the people you want to get the value of your estate get it and and for whatever reason those you don't don't okay rather than leaving it up to um the court and and the state in which you live okay next is an attorney in fact they call this a power of attorney the
8:26 power of attorney is the document that appoints someone as your attorney in fact that person has the authority to act on your behalf in a variety of issues okay so um if you become incapacitated okay not not die if you die that cancels um that that cancels a power of attorney and and whoever was appointed is no longer your attorney in fact um but if you become incapacitated the um Power of Attorney can kick in and
9:03 that person then has the authority to make decisions and act on your behalf now you know you that can be a good thing because you you may not want uh you know a particular person to have authority over you um and or you may very much want a particular person to have that Authority so appointing an attorney in fact will do that for you and it will sustain your wishes now um by the way you can you can appoint an attorney in fact and an
9:39 alternate okay especially if you're appointing a parent okay it's it's you know in the normal course of things our parents pred deese us um and so you may consider um appointing someone as an alternative to a parent especially if your parents are um you know a little more advanced in age so um what can an attorney in fact do well they can handle our financial matters um they can handle um uh logistical matters where we live how we live those kind of things they
10:15 can you know sign a lease for us if we need to move into a different kind of living situation all of those types of activities are things within an attorney attorney in fact an attorney's in fact um prerogative of course the power of attorney will um will uh delineate what Authority the attorney in fact has okay generally speaking it will say the attorney in fact can do these and the attorney in fact cannot do these okay um if
10:52 especially if there's something in particular you don't want the attorney in fact to be able to do it should be specifically a excluded um otherwise you're leaving it to to interpretation you're leaving it to chance okay next is a health care directive so again if you're incapacitated in some way to the point where maybe you can't communicate your wishes okay maybe you're you're in a you're in a coma or something like that so by leaving a health care directive that will um tell your your family members
11:30 your loved ones the you know the people that are there helping you um as well as health care providers what you want to have happen um in this with respect to Health Care decisions so um for example um if you on life support and um you know you don't want the you know proverbial uh plug pulled well you can put that in a healthcare directive in that way um you know these things aren't absolute but in that way most likely um
12:07 you will be retained um and everything will be done to keep you alive okay um in and and in order to get around that Health Care uh directive you know there would have the courts would have to be involved and nonetheless that healthc care directive will be strong evidence of what your wishes are are okay so um a health care directive it's it's kind of like um a power of attorney um oftentimes it will um appoint someone to
12:42 make decisions on your behalf should you become um incapacitated to the point where um you're not um um able to to make Health Care decisions okay um and in that case um you know I would recommend that whoever you appoint in the healthc care directive is someone who shares your values or at least um will make decisions in accordance with your values okay in order for the healthc care directive to be most
13:19 effective okay next beneficiary denic designations so um if you have um various um assets maybe you have some bank accounts brokerage account okay you can um often times designate a beneficiary on death for those accounts and in that way um you avoid um going through probate um when you die um the person who's the designated beneficiary
13:56 can contact the um the institution that's holding the account um generally speaking they'll have to present uh a death certificate showing that in fact you are deceased and fill out some paperwork and they'll become the owner of that account um and in that way um in in in most if not all cases they'll avoid going through probate okay now um this you you can see that beneficiary designations kind of work um hand inand with a will so um you may put some
14:34 things in a will and designate your beneficiaries in your will okay other things won't go in your will because they'll pass outside of probate okay and so those those need to be coordinated you may want to get some advice on these kind of things um especially rules specific to your state okay but but these are two ways of dealing with um property that you have um to make sure it it goes to the people that you wanted to go to or to the person you wanted to go to um you
15:12 know after after you pass away okay next group here we go all right you may want to consider carrying some life insurance now um you know if you have no spouse you have no family you have no house house um there and there's no one who is financially reliant on you so it may be that you don't really need a lot of life insurance on the other hand there are the costs of burial there may be costs associated with wrapping up your Affairs and you
15:47 may not want that cost to fall on whoever is the executive in your will or your they you may not want them to fall on your attorney in fact or the person designated in your your health care directive and so you may you may um um create a life insurance policy and name those people as your beneficiary to see to it that they have the resources that are necessary um in order to handle your Affairs when you're gone for for example your burial you know you see these
16:22 commercials all the time I think what does it say it it costs a minimum of $10,000 to you know to uh conduct a funeral or whatever the number is I you know um it it it the the bottom line is it's not expensive and in a city like Los Angeles where um there's you know less and less available Cemetery space the cost of a cemetery plot can be very high um and so what's happening here in La is is people are going farther and farther away from the city in order to
16:57 um inter turn loved ones um and there's a cost to that as well because if if people want to visit your grave site um you know they're farther away um and and it's harder for them to do that I know my father is is buried in a military SE uh Cemetery in the Inland Empire it's about an hour's drive maybe a little bit more for me to get there and it's very difficult for me to do that um you know with with all the various resp responsibilities that I have it it makes me sad because I would like to go visit
17:32 his grave site more often I I it's just it's it's it's too difficult because he's so far away so these are all things to consider and they may um they may um necessitate your buying even a small life insurance policy now if you're young and in good health so then the premiums are are not going to be very high you you don't need anything fancy in many cases you may just need some term life um and um and again for a young healthy person um it can be ve the
18:08 premiums can be very very inexpensive so it's something well worth taking a look at um to you know as as again as part of your overall estate planning okay next digital assets so um the ownership of of of uh cryptocurrency and non fungible tokens um probably much broader among younger people than they are among you know people my age um now the thing about dig digital assets for especially those of
18:43 you who who deal with them you know this right um if if you lose the the uh login credentials to access a particular account or your your digital wallet um there's pretty much no way to recover those okay so if you um if you pass away okay and and maybe you know your family members know hey you know um my my my brother my my sister had some you know
19:19 Bitcoin right but it's in a wallet we have no idea how to access it um they may never be able to get a hold of that asset and and what a shame so um within your will you may want to um document um the the the uh URLs um where where the of the the um digital Walt Etc or the you know the exchanges where the digital assets are kept or or the apps on which whether it's crypto.com or whatever this
19:54 is not an endorsement of that it's just that one happen to be uh be the first one I thought of but the apps that you're using and then what your um login and pass your login ID and password is okay um and and by the way if if it there's some kind of um um uh uh double um what do they call it double authentication right where you you log in but then it sends some kind of code to your cell phone you may also want to make sure that they have the codee to
20:30 unlock your cell phone so that when they go to log into that account they can okay so um and and by the way um this is another thing it's it's not on the list here um but it's it's worth raising and that is um the log on login information for your social media accounts okay um if you want something done with them um it's a good idea to leave some instruction along with the information necessary to access access them um and you could do it in the same way that you
21:05 leave the information for your digital Assets Now obviously you want to be careful you don't want this stuff just lying around where you know anyone can pick it up or or you know and and and and steal it from you however um it can be um put into a safe um if you have one at home a fireproof safe um would would be best it can be put in a safety deposit box there's there are debates that go on whether safety deposit boxes are actually a good place to put um information these days
21:40 um but there are ways you can secure the information um while making sure that um if they need to um your executive your heirs will have access to it okay but but keep in mind you know digital assets are not like um are not like Financial assets like like a brokerage account or something like that um they can be more difficult to to access in the absence or or impossible in the absence of of the access uh information uh okay next um goals
22:18 so um what when you're thinking of when you're in the early point of of setting up your estate plan one of the things you may want to think about is uh what are your goals for yourself and your estate going forward okay and and if you start um sort of um documenting those that'll make future estate planning easier okay because you'll you'll have a sense of the direction that you're going in and especially um if you're you're
22:56 talking to um you know your potential heirs or people who are helping you if they have a sense of where you're going with things that can be useful um as as you know in in terms of making sure that your wishes get carried out at some point in the future when you're um unable to do so yourself so while not strictly part of an estate plan um you know figuring out the future so to speak um I think it's especially for if you're
23:32 just starting out it is something well worth taking the time to ponder make some notes about um and um you know make the that information accessible to the people who you have appointed and or asked um to help with these matters going forward okay and then next is to do a periodic review so no estate plan is is um good forever um any estate plan
24:08 is only good for a certain period of time and that period of time us well yeah that period of time lasts until something substantial changes so if you have an estate plan and then one of these three things changes you get a house you get married you have children or or somehow um you you you know you you you have family members that you're responsible for maybe you have a younger sibling um something happens and now you're responsible for that younger sibling
24:43 okay so if any of these things change your estate plan probably has to change as well so for example if you buy a house at that point it may very well make sense for you to um create a living trust so that your house doesn't have to go through probate if you were to pass away okay if you get married now you know presumably your spouse is going to be your primary Heir but not necessarily but what is all
25:18 that going to mean um and and you know under the laws of intestate succession which are the laws each state has about who gets the property of someone who dies without a will without a trust Etc spouse is usually a primary Heir but not necessarily 100% Heir okay so if you have children um you know your your property may be divided between your spouse and your children according to the laws of inst intestate succession
25:53 now maybe that is what you want fine um but what if those laws were to change right as they sometimes do so once you have a spouse Andor family members to wh to whom you're responsible then it's time to review your estate plan um and and make sure that it's up to date with your situation and in any event even if none of these big three issues have changed um you may change jobs you may accumulate more more uh wealth and so it
26:29 may just be that even though you don't have a house or a spouse or a family you may have a big enough brokerage account um or you may have some other real estate assets or maybe you've you've bought into um you know a real estate investment on some kind of LLC or partnership basis or whatever and and so that might um mean that you'd be better off um having a a trust of some kind rather than a will so it is a good idea to periodically review do you have to do it once a year not
27:04 necessarily um if if nothing really has changed during the year you may not need to review it um but you probably want to look at it every two three years minimum even if it doesn't seem like anything has changed it's it's a good idea to take a look at it relationships may have changed um your uh you know perspective on certain things may have changed you may not realize you may have forgotten what's you know in parts of your estate plan and so it's worth taking another look even if in the end you don't change anything it's it's time well spent okay
27:40 and then finally you may want to get some professional help okay now I mentioned in drawing up a will you probably want to at least have a lawyer um look it over even if you drew it up yourself um it that's a good idea to make make sure that it complies with all the laws in your state but you may also want some professional help in setting up beneficiaries in setting up a health care directive and establishing an attorney in fact all these other things whether getting advice whether you need life insurance or not all of these are
28:16 questions that uh a financial planning specialist especially someone who is knowledgeable about estate planning can help you with um an estate planning lawyer or a trust and estate lawyer can help you with many of these an your accountant May or you or an an accountant may you may want to find an accountant to help you with these things so those are the three main um professionals that would help you with your estate planning a lawyer um an accountant and a financial services professional those
28:52 three and they should have experience in Estate Planning in order for their advice to be most valuable okay so um you know this it won't take you a lot of time um you know you're the the number of decisions you'll have to make is is you know going to be dependent on you know how many of these issues are of concern um but but in any event um as I said already as I've said already a couple of times it is uh it it'll be time well spent both for yourself as well as the people that you
29:27 leave behind okay if you have any questions so these U links will be in the show notes um so uh feel free if it's a general question post it um in uh our um social media if it's a an individual or personal question you can always email me or or send me a direct message I'm happy to answer the question if I can if it's something outside my scope of knowledge and practice I'll be happy to refer you to someone who can and I think we just have the legal stuff here right
30:02 yep there we go and we'll go ahead and close this off to wrap things up so thanks very much for joining me um I hope you found this uh useful and informative and uh so then tomorrow um is at 10: am Pacific time is business lessons from the military and I'm trying to remember what the top topic is oh yes so I'm going to be talking about a very famous World War II um battle called operation Market
30:37 Garden and you're like why are you going to talk about a World War II battle well I think there are some excellent business lessons that we can take from the failure of this operation to be successful so please do join me tomorrow at 10: a.m. Pacific Time on Wednesday at uh 10:00 a.m. Pacific time I'll be talking about the four questions that every entrepreneur must answer if they want to have a a successful Venture okay again that's on Wednesday at 10 am and
31:13 then seven days from today I'll be back for the next edition of trust and Estates weekly so I thank you very much for tuning in today wish you a wonderful rest of the day and signing off as I always do Marie you're my bell all the best folks