As the new year starts to come into focus, people will invariably start to make resolutions. With this in mind, we encourage you to make 2026 the year you finally end the procrastination and plan your estate. When you understand the facts, you will see that it is easier than you think.
Asset Transfers
The first order of business is to determine how, and to whom, your assets will be transferred. A simple will is an option, but it must be admitted to probate, which is a costly, public, and time-consuming process.
There are also limitations when you use a will to transfer assets. On the other hand, if you use a trust, probate is not a factor. Plus, there are different types of trusts that satisfy targeted objectives.
One thing to understand about estate planning is that there is no one-size-fits-all solution. There are different ways to proceed, and the optimal approach will vary depending on the circumstances.
This is the main reason that do-it-yourself estate planning notions are not recommended. Contrary to some things you may read online, the documents themselves may be sound for the most part. But as a person who is not in the field, do you really know the best way to proceed?
Incapacity Planning
Though it is an unpleasant reality, incapacity is common among seniors. Alzheimer’s is a leading culprit, striking about one-third of people who are 85 years of age and older. This is just one cause of cognitive impairment, and there are physical ailments that can enter the picture as well.
If you do nothing to prepare for possible incapacity, the government can be petitioned to appoint a conservator to handle your financial affairs. To take the matter into your own hands in advance, you can name a representative in a durable power of attorney.
In addition, the revocable living trust is the most commonly used trust in estate planning. Probate is not a factor when you use this type of trust, and from an incapacity perspective, you can name a disability trustee to manage the trust if it becomes necessary.
Advance Healthcare Directives
There is also the matter of medical decision-making in the event of your incapacity. To account for this contingency, your plan should include advance directives for healthcare. One of them is a living will, which is used to assert your life-support preferences.
A durable power of attorney for healthcare or healthcare proxy should be added as well. The agent that you name will be empowered to make decisions that are not related to life-support matters that are addressed in the living will.
Long-Term Care Planning
An often-overlooked element is the matter of long-term care. Most seniors will need long-term care eventually, and Medicare will not cover the custodial care that nursing homes provide.
Medi-Cal will cover this gap, but it is a need-based program. In 2026, the asset limit will be imposed once again, so it takes careful planning to position your assets with future eligibility in mind.
This is typically done through the utilization of an irrevocable, income-only trust. With this strategy, you can continue to receive income that is generated by assets that you transferred to the trust. As long as you act in advance, the principal will not count if you apply for Medi-Cal.
Access Our Free Worksheet!
We have created a worksheet that you can go through to gain a more thorough understanding of this important process. There is no charge, so this is a great opportunity to see a complete picture. You can click this link to gain access: Free estate planning worksheet.
Need Help Now?
If you are ready to end the procrastination and work with a Petaluma, CA estate planning lawyer to put a plan in place, we can help. You can send us a message to request a consultation appointment, and we can be reached by phone at 707-769-9975.
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