No part of financial planning flummoxes and bedevils people as much as estate planning. It makes the powerful weak and the merely-average absolutely-incapable. It makes proactive folks sheepishly cower, waiting . . . waiting . . . . . . waiting. And it makes high-output folks stare vacantly into space — zombie-like, non-productive, mouth agape, doing what Basset Hounds, Bullmastiffs and especially Saint Bernards do.
Contemplating death can do that to a person.
And that’s what estate planning is mostly about for most people: it’s mostly about deciding who gets your stuff when you die, and putting those decisions into a document that can make that happen. And that means going there, where there equals the world without you. And if you’re like most human beings, then you much prefer the world as it currently exists, i.e., with you, thank you very much. And so people stay away from estate planning in droves of droves and droves of droves.
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Estate planning lawyers — lawyers who help their clients have wills and such — are of little help. Most want to work with only rich people. Normal folks (NFs in JFF parlance) need not apply.
And so it is that estate planning lawyers are one of the big reasons people don’t get their estate planning done. In the name of wicked high fees, they bottleneck the population from being able to take care of this very important business, rather than shepherding people towards using their services and helping them do the right thing towards their loved ones. Estate planning lawyers, when taken as a whole, then, present a huge hurdle to people getting their estate planning done, and a but-for cause of much post-mortem blues. Oh the irony of it all! Oh the irony of our system!
And so the world in which we live is one where the evidence suggests that something like half of the people we see on the street each day do not have any of their estate planning done — no wills, let alone the living trust and the powers of attorney and the medical directives and the HIPAA release and all the other various and sundry pieces of paper that go into a comprehensive estate plan.
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And don’t you go thinking that great, talented people with plenty of time to take care of this sort of business are immune. Abraham Lincoln, for instance, himself a lawyer and no spring chicken upon his untimely and murderous demise, left this mortal plane without having a will, as did Pablo Picasso, who’d been exceedingly wealthy for many decades and therefore had plenty of time to get his estate planning act together before his
untimely death at the age of 91.
The human being animal is simply not good at getting this stuff done.
And so it is: fallible animal, meet kludgey estate planning system, and say hello to dying without a will.
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It’s a truly wonderful thing, then, when government — yup, that gub’in’mint, that gub’in’mint thing that many people see as being keystone-cop-like incapable of doing anything helpful — steps into the void by cutting the lawyers out and lending a hand to folks who need as few barriers between them and their completed wills as possible.
California, through its Statutory Will — a fill-in-the-blank form that you can download from the Internet and then fill in all by yourself — has done just that. Thank you, you Golden State you.
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This piece is all about the California Statutory Will — what it is, how to use it, and how you can get yours done with little muss or fuss. It also includes a step-by-step guide to the California Statutory Will form itself.
Reading this piece will take you, say, twenty or so minutes — half an hour at the outside. Filling out your California Statutory Will should also take you about twenty minutes — half an hour, tops. In total, then, learning about and completing a California Statutory Will can take considerably less than one hour. Why, I bet you spend more time each year keeping your car clean and shiny!
A bit harder to predict is how long it will take you to decide the “who gets what” part of your estate plan and a few other things. But it’s important for you to make those decisions, and doing so now is a far better approach than doing so not-now — I mean, what are ya, a slacker?! — so please do get a move on with making these decisions, OK? And remember: when you get yours done, you’ll be more estate-planned than half the people you see!
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Filling In Your CSW: Five Decisions is All It Takes.
To help you get a move on, few things are as helpful as a California Statutory Will, primarily because it shows you just how few in number those decisions truly are, as in five.
Yup: there are only five decisions you need to have in place in order to complete The California Statutory Will, and you probably already have three or four of them down cold already. So you can think of the California Statutory Will as a checklist of sorts, about things that every California will should contain, and you should, I believe, breathe a sigh of relief knowing that the checklist is shorter than the shopping list you last took with you to the grocery store.
Once you’ve made those decisions and completed your California Statutory Will, you’ll have a real honest to goodness California will, and that means you’ll be well on your way to getting the estate planning part of your financial world completed for a major chunk of your life — a decade or two or three in all likelihood. It’s a nice one to have checked off.
So, a half hour to an hour, plus some time figuring out who gets what, and you’ll be golden, no lawyers involved. Nice, eh?
Please do read on.
Background on Wills Generally: Very Formal Documents that Make Doing-it-Yourself a Very Dicey Proposition.
In days past, turning a piece of paper into a “will” normally involved a trip to a lawyer, because, here in California at least, and in many other places as well, a will had to be created in a very certain, highly formal way, e.g., it had to be signed and witnessed (*not* notarized), or, if it was un-witnessed, then it had to be signed and 100% handwritten (no typing or computer printing allowed! Nada. Zilch. Not even a speck.).
That formality created a big problem: sometimes a person thought that he or she had created a will, but hadn’t (due to a lack of witnesses, or due to not being 100% handwritten, etc.), and the issue lay hidden away until that person died, at which time the problem came to light and it suddenly became clear, for the very first time, that there was a problem and that the only way to fix the problem was to get the signature of a dead person (by no means an easy feat, either with or without witnesses . . . ).
All of this meant that estate planning lawyers had great businesses. They were the only guides into and through the mysterious realm — the only way to get in and find your way around — and woe be unto anyone who tried to make the journey without a guide. And so it doth came to be that the guides priced their services accordingly.
Background on the California Statutory Will: A Fairly Fool-Proof Way for Californians to Write their Own Simple Wills
In 1983, though, and much to its credit, California did something less than a handful of other states have done: it passed a law making it easier — much easier — for Californians to create a very simple will via the use of a standardized, fill-in-the-blank form. By using this particular form, it became possible to have a partially-printed, partially-handwritten piece of paper that reached the exalted status of will. True, it still had to be witnessed by two people, but, still, it represented the quickest way a person could go from not having a will to having a perfectly valid will (or, in the legal lingo, going from living continuously with the risk of dying intestate to the near-certainty of dying testate).
That very simple will is called a California Statutory Will. From here on, though, I’ll mostly skip all those words and simply refer to it as a CSW.
And, yes, if you don’t live in California, then no CSW for you! But there is SW-hope for some of you, as, according to Nolo Press (itself another California institution of doing-the-right-thing), there are also a couple of MSWs and an NMSW and a WSW out there waiting for those of you living in Maine and Michigan, in New Mexico, and in Wisconsin respectively.
Regardless of where you live, you can still get something out of reading this piece — e.g. what wills are all about, and the most essential ingredients of a simple will, etc. — but please do keep in mind that the CSW form is intended for the use of CA’ians’ only.
The California Statutory Will: An Easy “Fill-in-the-Blank” Sort of Form that You Can Fetch Off the Internet.
The best place to get your copy of the CSW is at the web site of the California State Bar (the organization in which all lawyers practicing law in California must be members). The main access page to the CSW is right here:
Shortened URL: https://is.gd/LKOdgw
And the form itself is right here:
Shortened URL: https://is.gd/LD6SjR
So please do open up that form on your computer — or better still, print it up — and then please continue reading.
Overview of the CSW: The Five Decisions You Need to Make.
Once you’re looking at the CSW, you’ll see a six-page form, with “fill in the blank” boxes for, e.g., your name, and “choose one of these four choices” sorts of boxes, for, e.g., who gets your stuff. These latter boxes are akin to checkboxes but, rather than checking a little box to the left of the choice, you sign your name in a big box to the right of your choice.
All told, the CSW requires you to make five main decisions. Most of them are about the “who” and the “what” in the “who gets what” aspect of estate planning, as follows:
Decision Number 1. First, you need to decide who gets your primary home if you have one (paragraph 2), who gets your stuff (paragraph 3), who gets your cash (paragraph 4), and who gets your everything-else (paragraph 5). For most folks this is one overall decision — it’s the “who gets what” decision — but you can name different people for each. So that’s one decision.
Decisions Number 2 and 3. You also need to decide who will parent your still-living-with-you kid(s) if the ultimate bad scenario happens and they are parent-less (paragraph 6), as well as who should manage your money in that situation (paragraph 7). Often one person fills both the parent and the money manager role, but sometimes a good person to take over the parenting role is not great with money, so a different person should handle that part of things. So let’s call these two separate decisions, bringing the total so far up to three decisions.
These kid-oriented decisions can be really hard, particularly when couples disagree about what the best choice is. If that’s you, or if you don’t have anyone that fits the bill, then fill in your best choice and get your CSW completed. Please do not let the hard part bottleneck you. You can fold back later and refine your choices.
Decision Number 4. You also need to name the person responsible for implementing all the decisions you’ve set out in your will about who gets what when you die; this person is your “executor” (with the emphasis on the second syllable, as in egg ZECK’ you ter, rather than on the first or third, which would really make the word sound odd in this context . . . ) (Paragraph 8). The main choice here is who to name if you don’t have a spouse when you die; typically it should be someone you trust who is decent at interacting with the business/legal world. They don’t have to be great at it, but they also shouldn’t be someone who is totally a fish out of water when dealing with those sorts of things. No total-hippies! If someone in your family is good with these sorts of things — a brother or a sister or a cousin or a niece or nephew — and can do OK while sitting on what can sometimes be the hot seat in the middle of your family, then that person should fit the bill well. Or it could be a dear, trusted friend. So that’s your fourth decision.
Decision Number 5. And then for your fifth and final decision there’s good ol’ paragraph 9, which is about bonding your executor — that phrase also sounds odd in this context, eh? — and is probably the most confusing part of the CSW for normal folks. A “bond” in this context is a form of insurance, so if you require your executor to be bonded, you are requiring your executor to buy a bond — purchasing that bond using the money you are leaving to others — to make sure that, if your executor is a scoundrel who absconds with the other part of your money and flees for the good life in Bali, that the loss is covered by insurance.
You should trust, to the n’th-squared degree, your executor — you are, after all, trusting that person with something very important, and you won’t be around to look over his or her shoulder and make sure that all is copacetic — and if you do have that sort of trust in your executor, then you do not need for your executor to be bonded. Why, last I knew, even lawyers (surely the profession which more than any other always plans for the basest, nastiest side of human nature) are OK with not bonding executors who are very close family members or very close family friends.
So keep it simple by naming an executor you are 100%-plus positive will be true blue, and do not require your executor to have a bond.
That’s your fifth decision, and that’s it: five and you’re done.
You are Human: Human’s Do Not Like Doing Estate Planning, So You Need to Set a Deadline for Yourself.
There is something about creating a will — even a simple, roll-your-own, not-a-lawyer-in-sight will like the CSW — that causes a lot of people to procrastinate on getting to it, let alone getting it done.
One way to get around that all-too-human behavior of yours is to give yourself a deadline for getting it done. And here is the detail that makes your deadline a real commitment: your deadline must be no later than six weeks from the date you are first reading this. OK? Six weeks from TODAY, six weeks from en-oh-double-you now. Got it? That’s plenty of time to get it done. Or you can set an earlier deadline if you are gung-ho on bucking the trend. How’s about two weeks from today?
In any event, simply setting a deadline for yourself doesn’t quite cut it, because that’s a tree falling in a forest without anyone being there to hear it fall, isn’t it? So, please, make a public declaration (at least a little bit public of a declaration) by (a) telling some other folks about this deadline, and (b) right at this very moment, sending an email to me stating in no uncertain terms what your deadline is, using this email address I set up for this very purpose and am happy to sacrifice to the spambots and spam-evildoers if doing so helps even one person get their CSW in place: CSW@JohnFriedmanFinancial.com. Clicking that will open up your normal email software with the address already filled in; you need only write down your have-it-done date and anything else you want to say, and then hit send. I in turn will do my best to help you hold that promise and then righteously fulfill it.
Trust me: most people really benefit from writing that email. So please do it right now, the first time you read this sentence. Go ahead: Click on that email address and put a date in that email and hit send. Or tell a friend of two. And if you have a spouse and you are the first to read this, then include your spouse on that email and make the commitment on your spouse’s behalf as well. After all, we spouses do that to each other all the time, don’t we?
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Countless people have succeeded at this, and you can too. And believe me: having seen this movie before, I can report, with some high degree of confidence, that it’s going to feel really great when you get it done. Truly wonderful. Like a great big weight taken off your shoulders. And it’ll mean that you are taking care of business, in this one regard at least, better than half of everyone else out there.
Please feel free to call with questions, and may you and yours live, in perfectly fine health, for exactly as long as you wish. . . .
Coda: I find financial planners, taken as a whole, nearly as blameworthy as estate planning lawyers taken as a whole. That is, just as most people don’t have an estate plan, so too most people do not have a financial plan. I do my best to counter my peers in this regard, by offering my services at price points that have varied by as much as two magnitudes (yes, over the years I have provided financial planning services at fees in the $100, $1,000 and $10,000 neighborhoods). What estate planning lawyers can say that?