By Philip Kavesh, Attorney
Although we do our best to make sure our clients’ estate plans are properly designed, drafted, maintained and administered, things can still go wrong - - usually because a few simple steps were overlooked by clients, despite our reminders. 
The good news is that most of these problems are preventable. Here’s…
A Practical Checklist
☐ 1. Make Sure All Assets Are Properly Titled in the Living Trust. Assets outside the Trust may wind up in a Court Conservatorship (if someone becomes incapacitated or incompetent) or a Court Probate (when he or she passes away).
Be sure to:
- Transfer assets properly into the Trust after signing it
- Update beneficiary designations where appropriate.
- Title newly acquired assets correctly in the Trust after the plan is created.
If you're our client, use the transfer letters we provided in your 3 ring binder “Estate Planning Portfolio” or “Owners Manual.”
Sometimes people simply forget to complete transfers or fail to place new assets into the Trust. This can cause the spouse, other Successor Trustee and beneficiaries significant expenses, delays and unnecessary headaches.
☐ 2. Come in Every 3 Years for a Free Review. Over time, a client’s situation can change - - marriage, divorce, births, deaths or financial changes. Relationships to those named as Successor Trustee and beneficiaries can change. The needs and circumstances of beneficiaries can change. Laws can change. We may also have upgrades to our legal documents.
Failure to address these changes can cause the estate plan to become out-of-date and not function as intended.
At the review meeting, we also confirm that all assets are properly in the Trust so any problems can be corrected before they become serious.
☐ 3. Renew the Health Document Emergency Card. This card helps assure that, when someone is rushed to the hospital in an emergency, the named health decision makers (spouse, child or other persons) are contacted immediately and the health care provider promptly receives the Advance Health Care Directive and HIPAA Authorization.
Otherwise, health decisions and proper treatment may be delayed while matters are held “in limbo” during critical moments.
We provide this card and pay for the first 3 years when a client sets up a plan or completes a substantial upgrade. After that, the client must periodically renew it. The outside company servicing the card automatically sends a renewal notice. Unfortunately, clients often ignore the notice or otherwise fail to renew. This is another important item we review at the 3-year meeting.
☐ 4. Complete the Key Pages in the “Owner’s Manual.” When our clients set up a Living Trust estate plan, we provide a spiral binder labeled “Estate Planning Portfolio,” which we also call the “Owner’s Manual.”
Clients are instructed to fill in certain information under the tabs:
- Location List
- Contact List
- Directions Letter
This allows the Successor Trustee to immediately have at his or her fingertips:
- The location of assets, statements and important papers
- Contact information for professionals (doctor, accountant, financial advisor, etc.) and beneficiaries
- Special directions about matters such as distribution of personal possessions
By taking a little time to complete these sections, parents can make the Trustee’s and beneficiaries’ lives much easier.
☐ 5. Consider Whether Planning Beyond the Living Trust Is Appropriate. Often, a Living Trust plan alone is not sufficient protection for the client and beneficiaries.
Additional planning may be warranted, such as:
- An “IRA Inheritance Trust ®” if there are large IRAs and retirement plans
- A separate “MAPT” (Medi-Cal Asset Protection Trust) if the client or spouse is likely to enter a nursing home
- A separate Gift Trust to reduce estate taxes, sometimes holding a life insurance policy
We may cover these at your 3 year review meeting.
Failing to pursue appropriate additional planning can be “penny wise and pound foolish.”
☐ 6. Refrain from Making Changes to Legal Documents on Your Own. This almost always leads to problems and frequently forces everyone into court when the plan is implemented.
Clients are not trained to write in proper legal language and often fail to follow the required formalities, making changes invalid. In other cases, changes may be overturned because someone was inappropriately involved or it can be argued the client lacked legal capacity.
Do-it-yourself surgery is a bad idea. Always consult your attorney before making any changes.
☐ 7. Prepare the Successor Trustee in Advance. Most Successor Trustees have never acted in that role before and can unintentionally get into serious trouble.
We help by providing:
- A Trustee Manual containing critical step-by-step checklists
- A link to a “Quick Start” video
- Periodic free seminars to prepare Successor Trustees to act when the time comes
If parents (or you) do not have a Trustee Manual or if you wish to attend a Successor Trustee seminar, call us.
☐ 8. Help Ensure the Plan Is Properly Administered at Death. A Living Trust is like a blueprint or set of directions, but it must be implemented by the Successor Trustee (surviving spouse, child or other appointed person).
Certain steps must be taken to carry out the plan. Failure to implement the plan timely and properly can result in considerable taxes or conflict among beneficiaries - - just the opposite of what the Trust maker intended and potentially causing family disharmony.
We offer the Successor Trustee a free consultation when the client becomes incapacitated and again when he or she passes away. We also include, as a reminder, a free consultation certificate in the Owner’s and Trustee Manuals.
Clients should make sure the Successor Trustee knows where these manuals are kept so they can be located and utilized immediately when needed.
☐ 9. Keep Assets and Records Organized. When assets and accounts are scattered - - including online accounts - - it can be extremely difficult for the surviving spouse or other Successor Trustee to locate and assemble everything.
The client can help by utilizing the Owner's Manual (see again item 4 above).
We also often recommend that clients work with a financial advisor to consolidate accounts or otherwise organize paperwork now. If a referral to such an advisor would be helpful, call us.
☐ 10. Avoid Procrastination. If you have read this far, you may have recognized several items that need attention.
The important question is - - what are you now going to do about it?
A good first step, if you have not reviewed your estate plan with us in the last 3 years, is to call 1.800.756.5596 and schedule a free meeting soon.
In addition, whether you have been in recently or not, you may wish to attend one of our free Living Trust Seminars to stay current with recent law and planning changes.
In Conclusion…
By taking a few simple actions now, your parents - - or you - - can help assure that the estate plan works properly when the time comes.
