Estate Planning Guide

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9330 Base Line Road, Suite 201 Rancho Cucamonga, CA 91701

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TABLE OF CONTENTS

PART I. INTRODUCTION TO ESTATE PLANNING ………………………………………………................. 1

Create an Estate Plan with Atlantis Law ……………………………………………….....……………...................... 1

PART II. ESTATE PLANNING BASICS ……………………………………………….....……………….……......... 4

Revocable Living Trusts ……………………………………………….....……………...................................................... 4

Last Will and Testament in California ……………………………………………….....……………........................... 6

Power of Attorney for Financial Affairs …………….…………………...…………….................………………….... 7

Advance Medical Directive ……………………………………………….....……………................................................. 8

PART III. SPECIAL CIRCUMSTANCES AND CONSIDERATIONS ……………………………………….. 10

Planning Ahead for Your Children ……………………………………………….....…………….........…................... 10

Special Needs Trust ……………………………………………….....……………......................................…................... 11

Estate Planning for Business Owners ……………………………………………….....……………....…................. 12

Charitable Donations: Leaving a Legacy ……………………………………………….....………………................ 13

Care for Your Pets by Forming a Pet Trust ……………………………………………….....…………..........…..... 14

Digital Assets ……………………………………………….....……………..............................................…........................ 14

Residuary Clause: What if Your Estate Plan Doesn’t Address All of Your Assets? ...........…............. 15

PART IV. MAINTAINING YOUR ESTATE PLAN ……………………………………………………………….. 16

Updating Your Estate Plan to Reflect Your Ever-Changing Life ………………………………..........…............... 16

CONCLUSION ……………………………………………………….……………………………………………………………….. 17

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9330 Base Line Rd., Suite 201

Rancho Cucamonga, CA 91701

909.329.1002

atlantislaw.com

PART I. INTRODUCTION TO ESTATE PLANNING

Create an Estate Plan with Atlantis Law You've worked hard to provide for your family. You have a home, life insurance

policies, retirement accounts, college funds for your kids, and savings--you've done a lot to protect your loved ones. So, why don't you have an estate plan? A complete estate plan will ensure that the things you've worked hard to earn will not be taken away from your loved ones. Give your family security and peace of mind today, by protecting them in the future.

When you create a complete estate plan with the lawyers at Atlantis Law, you are giving your family security and peace of mind. You are ensuring that they will be cared for when you're no longer there to help look after them. Our estate planning lawyers will guide you through the estate planning process, explain what estate planning is, and make sure your exact wishes are carried out how you want. Our lawyers will always treat you with respect and compassion and will provide you with valuable insights into some difficult decisions you may have to make.

What exactly is an estate plan?

Think of your estate plan as your own personal road-map with specific instructions for loved ones. These instructions pertain to how your children will be taken care of, how your property is distributed, how you are taken care of when sick, and a host of other decisions that need to be made when you pass away. Your estate plan will explicitly state what you want to happen and how it should happen. One of the main purposes of creating an estate plan is to avoid probate, which is an expensive and lengthy court proceeding that takes away time and money from your loved ones.

Included in your estate plan are the following legal documents:

Revocable living trust Last will & testament Durable power of attorney over financial affairs Advance health care directive

These four documents comprise your complete estate plan and will help you avoid probate and ensure that your wishes are carried out exactly how you want.

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Creating your own complete estate plan is an EASY 3-STEP PROCESS:

Step 1: Free Consultation and Retain

We offer free estate planning consultations to all of our future clients:

An expert estate planning lawyer will personally sit down with you to discuss your goals and objectives. We will attentively listen to you and do our best to answer all of your questions. You will only meet with a qualified estate planning attorney--not a paralegal or law clerk.

The attorney will also give you an exact price for your estate plan at the end of your consultation. Every plan is different, so the price will vary from case to case, but the general range is from $1,000 - $2,000 for your complete estate plan. We are very flexible with payment plans and will work with you to make payment arrangements if needed.

During the consultation, your may retain Atlantis Law to create your complete estate plan.

You can retain with us for a small deposit while we work on generating your estate plan. We promise to always be available to answer your questions and provide guidance regarding the important decisions you'll be making--we are just a phone call or email away.

Step 2: Prepare and Draft Your Estate Plan

After retaining with us, your lawyer will prepare your estate plan.

We will give you a short questionnaire and checklist to help guide you through creating your estate plan. This will help you to start thinking about who your beneficiaries will be and how you want your property to be distributed.

Once you return the questionnaire to your attorney, he will draft your estate plan according to your specific wishes.

After completing the first draft, you will carefully review it. If edits or changes need to be made, your attorney will make them until you are happy and satisfied with a final draft.

Step 3: Sign and Notarize Your Estate Plan

Once your estate plan is finalized, your attorney will arrange for a signing and notarization appointment. We can also come to you if needed!

Once you sign your complete estate plan and it is notarized, your estate plan becomes a legally binding document. Keep the original in a safe place and give copies to loved ones.

As you can see, creating your own complete estate plan is a straightforward and quick process. The usual turnaround time is around a month or so. These 3 simple steps are all it takes to give you and your family security and protection. If your estate has to go through probate, your hard earned money may not entirely go towards your loved ones, but rather to an attorney and the

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court. Take charge of your property and ensure that it all goes to your loved ones. Contact Atlantis Law today to schedule your free consultation with one of our estate planning lawyers.

What happens if you don’t have a will or trust?

Have you ever thought about where your assets will go after you die? What if you die without a will or trust?

Dying without a will—known as dying "intestate"—means you have no say over who receives your assets. Instead, your heirs will be left with the costly and complex job of disputing who gets what. Your assets go into "probate," which is an expensive and drawn out legal process which determines who inherits your estate, and can take anywhere from 6 months to a few years, depending on how complicated the estate is.

In California, if you are not married or in a registered domestic partnership, your assets will be distributed to: (1) your children or grandchildren (if you have any) or (2) your parents, sisters, brothers, nieces, nephews, or other relatives. If your spouse or domestic partner dies before you, his or her relatives may also be entitled to some or all of your estate. Friends, a non-registered domestic partner, your favorite charities, and your pets will receive nothing if you die without a will. If you (and your deceased spouse or domestic partner) have no living relatives, the State of California will receive all of your assets if you die intestate.

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PART II. ESTATE PLANNING BASICS

Revocable Living Trusts A living trust is a legal document that allows you to distribute your assets to your loved

ones while avoiding probate. Revocable living trusts are often preferable to wills because they offer a fast, private way to transfer one's property after death. A living trust is not a substitute for a will, but it can help to transfer real estate or other financial property, and most importantly, avoid probate.

Why are living trusts revocable?

Living trusts are known as revocable because you can alter or revoke them at any time while you are still living. Once the trust is created, it is completely alterable until your passing. The revocability can also be helpful in case a beneficiary passes on or relationships change, altering the way you would like to structure your trust. Life is constantly changing and you never know what the future holds, and the flexibility of a living trust allows you to make changes as needed.

Making Choices Concerning Revocable Living Trusts

Revocable living trusts involve a lot of decisions; some of the choices you will need to make include:

Deciding whether to create a shared trust or individual trust Deciding who will inherit the property in the trust Deciding what items to leave in the trust Deciding who will manage the trust for minors Choosing a successor trustee (and back-ups) should something happen to you

Drafting the Document

After you outline the contents of the trust and make all necessary decisions, our lawyers will prepare the trust document, which is called a declaration of trust. After the document is drafted to your satisfaction, you will sign it and have it notarized. Once notarized, it is a legally binding document.

Funding Your Trust

Once you've created a revocable living trust, there's one more crucial step: funding your trust, which is just as important as creating a trust. Funding your trust is the formal process of transferring your assets from you to your trust. To do this, you must: (1) physically change the titles of your assets from your individual name (or joint names, if married) to the name of your trust and (2) change most beneficiary designations to your trust. Your attorney will guide you through this.

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(a) Forgetting to Fund Your Trust

If your trust is never funded, it will have no effect on how your property is transferred after your death. Instead, the assets you thought your trust would control will pass under your will or, if you don't leave a will, under probate laws.

Forgetting to fund a trust or leaving out valuable assets is very common. Many people assume the attorney they hired to draft the trust document will also take care of funding that trust. But that's not always the case. Thus, you must do three things to ensure your assets are transferred into the trust. First, you should review each asset with your attorney. Second, have your attorney explain the procedure of transferring assets and help you decide who will be responsible for transferring each asset. Finally, the transfers must be completed by you and/or your attorney.

(b) Assets With Title Documents

If an asset you want to hold in trust has a document showing who owns it, then you'll need a new title/ownership document, showing that the asset is now held in the trust. For example, if you want to hold your house in your living trust, you'll need to prepare, sign, and record a new deed, showing that the property is held in your trust. Your attorney will prepare the new grant deed for you, which will convey you home into the trust. Real estate, stocks, bank accounts, , copyrights, and patents are all common examples of assets with title documents.

Although most transfers may be handled by mail or telephone, some institutions require a short assignment document, a certificate or trust, or written instructions from you as proof that your trust exists. These documents verify your trust's existence and contain basic information about the grantor (the person setting up the trust), the trustee, and the date the trust was created. These documents do not reveal information about your assets, your beneficiaries, or their inheritances.

(c) Assets Without Title Documents

Lots of assets, including many valuable ones, don't have official title documents. Personal property, such as jewelry, artwork, clothing, cameras, books, etc., typically does not have a formal title. Accordingly, personal property must be transferred by either listing it in a schedule attached to the trust or by executing a separate assignment of such property to the trust.

Many people forget to complete the process of getting the document notarized and funding the trust. Failing to complete these crucial steps automatically makes the revocable living trust invalid. After the entire process is completed, store the revocable living trust documents in a safe place.

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Last Will & Testament in California If you plan to leave your assets to your loved ones or other beneficiaries, it is important to

create a will. A last will and testament, if drafted legally and with the help of a seasoned lawyer, can act as a guide for others after your death. The will can apportion all of your assets to the correct individuals, making sure that your loved ones are well cared for even after your passing.

Reasons You Should Make a Will

A will can be used to:

Leave property to your children, spouse, family members, or an organization Name a personal guardian for your minor children Name an executor who will be entrusted with carrying out the terms of your will Name a trusted person to manage property left to minor children Leave the decision of who gets what up to you instead of the probate court

Drafting a Sound & Reliable Will

When you draft a will, you need to make sure that all of your property is accounted for and each of your beneficiaries are specifically named. Your will should also name an executor. Additionally, that the document must be signed in the presence of two witnesses who will also sign the will to make it official.

If you do not hire a skilled lawyer to assist you with creating your will, you could make devastating mistakes that render your will invalid. It is highly recommended that you retain the counsel of an experienced estate planning lawyer to assist you with making this document.

“Pour-Over” Will Most of the time, your attorney will draft a “pour-over” will as part of your estate plan. Your will works in conjunction with your living trust in order to avoid probate. It is impractical to re-title all of your assets (things like jewelry, furniture, collectibles, etc.) into the trust, so your will acts as a safety net for all of your other personal property that is not already in the trust. Your will states that once you pass away, those assets that are not in the trust, will then be “poured” into the trust and the trust will become the owner of that property. The Trustee you have named will then distribute that property according to the instructions that you’ve set forth, avoiding probate.

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Power of Attorney for Financial Affairs A power of attorney is a document that gives a trusted individual control over your financial

affairs. You can designate the applicability of the power of attorney on your own. An agent may only have the right to take charge if you become incapacitated.

It is often wise to create a power of attorney in case you are struck with a mental disability or a mental disease such as dementia and can't make your own choices any longer. While it may seem disheartening to think of incapacitation, the truth is that having a power of attorney "just in case" can provide peace of mind and ensure that you will still be able to take care of your family even if you are not mentally capable of doing so.

Types of Powers of Attorney

You can choose from several different options for powers of attorney, including:

Durable – This type allows someone to act in the place of another for all financial decision making. The form is valid even if the individual who is in charge of the finances becomes incapacitated.

Limited – This type of power of attorney allows someone to act in the place of another for a specific and single duty. Once that duty is completed, the form is no longer active. For example, a limited power of attorney may demand that a principal—the person granted power—cash in on all stocks or invest in a particular real estate property.

General – This power of attorney says that if the principal becomes incapacitated after receiving power, the form will be void. Normally, the state will take control of the finances at this point.

Understanding the Agent's Job in a Power of Attorney

Through a power of attorney, the person who is named the agent is the individual who has permission to act on your behalf in financial affairs should you become incapacitated.

Some of the jobs that these agents are given include:

Collecting Social Security, Medicare, or other government benefits Filing and paying taxes Handling transactions with banks Buying, selling, paying taxes on, and maintaining real estate and other properties Investing money in stocks, bonds, and mutual funds Operating your small business Using your assets to pay for everyday expenses Managing your retirement accounts Hiring someone to represent you in court Transferring property into a trust that you created Claiming property that you inherit

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Advance Medical Directive

Who will make your health decisions if you become incapacitated?

Over one-third of Americans fail to make plans to take care of themselves in case they are

no longer able to do so. If you became incapacitated and never named someone to have power of

attorney for your health decisions, a court may appoint someone to handle those decisions for you.

In order to avoid having someone you don’t know or trust make your personal health care decisions

for you, you must have an advance health care directive.

A California advance health care directive enables you to have a say about how you want to be treated should you become extremely sick or incapacitated. It also dictates any decisions for your end-of-life treatment and care, should you be unable to make those decisions for yourself. You may fall ill and be unable to communicate. For example, if you are in a car accident and fall into a coma or if you suffer from dementia at the end of your life or experience cardiac complications, then you will be unable to communicate your wishes to doctors and care providers.

Some individuals feel very strongly about medical care. Some patient want all surgeries possible performed and to remain on life support if that is the only option, while others don't want any surgery or life support. Your medical directive will make it known exactly what you want done.

What the Advance Medical Directive Includes

An advance medical directive typically has two parts: (1) a durable power of attorney for

health care and (2) a living will. A "durable power of attorney for health care" designates a person

who can legally act as your agent, making medical decisions for you if you are incapacitated. The

living will describes the type of care you would want if you become critically ill and what you

want/don't want in terms of end-of-life care.

Choosing a Healthcare Agent

In order to make a legitimate California advance health care directive, you will need to choose a person who can make medical decisions for you should you become too ill to make them yourself. If you fail to choose a healthcare agent, then your doctor will probably choose a family member to make decisions for you in the event of a medical emergency.

The requirements for a healthcare agent are that the person:

Must be a designated family member or friend Must be at least 18 Must know you well Must be there for you when you need him or her Must be trustworthy

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Must be able to tell your doctor about your decisions

Your agent should also be a strong advocate for you and someone who can handle conflicting

opinions—likely from your family members, friends, and medical personnel.

Choices Your Healthcare Agent Can Make for You

After you choose your health care agent and they accept the position, you must discuss your

health care decisions with your agent and review your health care directive with them. Although

this discussion may be difficult to have, it is extremely important because your agent must try to

make decisions the way you would. Through this discussion you should address your choices for

topics like life-sustaining measures, organ donations, funeral arrangements, and disposition of

remains.

A healthcare agent has the ability to say no to doctors, nurses, or social workers and refuse or acquiesce to medications and tests. The agent will also be able to determine what hospitals or clinics you are treated at, if necessary.

Your agent will also be able to make decisions regarding:

Life support CPR Dialysis Breathing machines or ventilators Blood transfusions Surgery Medications Feeding tubes End-of-life care

The advance healthcare directive can serve as your agent's guideline, helping him or her to make the decisions that best reflect your wishes.

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PART III. SPECIAL CIRCUMSTANCES AND CONSIDERATIONS

Planning Ahead for Your Children

Establishing Guardianship in Your Will

Guardianship is the practice of determining a new caregiver for your minor children should you become incapacitated and unable to care for them or you pass away before they are legal adults. It may seem devastating to think of a future for your children that doesn't involve you, but it is often wise to plan ahead just in case a tragic event should occur.

It is often best to establish guardianship in your will. You can include a paragraph in the document discussing where you would like your children to go should you pass away. You may want to designate a family member, such as a sibling or a parent, to take care of the children.

You also may want to consider designating a trusted family friend who you believe could be a good godparent. When this guardianship provision is carefully included in a will that has been signed and witnessed, it will serve as the guiding plan if an unfortunate incident occurs.

Leaving Inheritances to Children

Many parents create living trusts in hopes of caring for their children in the case of an emergency. However, various legal issues may arise when inheritances are left to minor children. For example, minors cannot hold title to property. Accordingly, in creating a living trust, it may be wise to funnel all of your possessions into trusts. Doing so can help you provide for your children by designating a trustee who can apportion the funds out of the trusts to them based on your instructions. This arrangement ensures that your children will be financially cared for after you pass away.

(a) Time or Age Restrictions

Parents with or without minor children who believe their beneficiaries are unable to effectively manage money or can't be relied on to make sound financial decisions, can disburse funds to their beneficiaries in smaller, regular amounts instead of one large lump sum, so their beneficiaries don't spend all the money at once. The money can be given out in installments—for example, one-third at age 25, one-third at age 30, and the rest at age 35. Or payments could be made yearly. The person you choose to serve as the trustee will manage the money, but won't have to make decisions about how to spend it. Instead, the trustee will simply make the distributions as

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stated in the trust document. Additionally, parents can specify how the funds can be spent (e.g., on rent, food, healthcare, and other necessary or unexpected expenses).

(b) Education Trust

Parents can also establish trusts to pay for education. A college trust fund offers flexibility in how and when money is disbursed for educational expenses. Typically, an education trust will specify that each child's full tuition and college expenses be paid, after which any remaining assets in the trust can be split evenly among all of the children. Most times, the children will have different financial needs—for example, if one child obtains a graduate degree, while another earns a bachelor's degree. Parents may decide to give each child the same amount, regardless of the cost of their education, or provide varying amounts depending on each child's educational costs.

(c) Incentive Conditions

Parents can appoint an adult, or executor, to carry out the parents' wishes and place conditions on the inheritance distributions; however, not all conditions are legal. Conditions against public policy that include divorce or the change of the beneficiary's religion typically will not be enforced by the court. Parents can put other types of conditions on gifts that encourage someone to do/not do something. For instance, you could make the condition, "to Sarah, if and when she graduates from college." Or you could say, "to Bob, as long as he uses the property for charitable purposes." Unfortunately, putting conditions on inheritances may complicate things. In order to actually enforce these conditions, you may have to pay an executor's fee for the executor to carry out your wishes.

Special Needs Trust Parents often engage in estate planning to ensure that their children are taken care of.

Unfortunately, parents who have only the best intentions for their children frequently make the mistake of leaving their special needs children or loved ones with disabilities with unprotected inheritances. Persons with disabilities typically receive government assistance through needs-based programs, including Supplemental Security Income (“SSI”) and Medi-Cal. In order to qualify for these programs, individuals cannot have assets in their own names that exceed $2,000. Consequently, leaving assets directly to a special needs child or person with disabilities through an inheritance will often disqualify that person for future government benefits.

In order to avoid the loss of these coveted government benefits, parents can establish a Third Party Special Needs Trust. Such a trust is not under the control of the person with disabilities; thus, the special needs person would not be able to revoke it and use the assets for his own purposes. Instead, an independent trustee controls the trust during the special needs person's lifetime. The Third Party Special Needs Trust can own several assets that are used by the special needs person, but the assets are not counted as that person's assets because the trust owns them. Although the trustee cannot give money directly to the person with disabilities, the trustee can spend trust assets to buy a variety of goods and services for that person. Special needs trust funds

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are commonly used to pay for personal care attendants, vacations, home furnishings, out-of-pocket medical and dental expenses, education, recreation, vehicles, and physical rehabilitation.

Estate Planning for Business Owners As a business owner, you should consider: what will happen to my business after I die? If

you own a business or an interest in a business, no matter the form of ownership—sole, partnership, or corporate—you should have an estate plan that specifically includes arrangements for your business.

What will happen to your business after you die?

If you want your business sold or liquidated upon your death, your estate plan should

include arrangements and instructions for such events. If you want your business to continue, you

must choose a method to transfer your business to your beneficiaries. Typically, it is not

advantageous to discontinue a business immediately upon the death of a business owner, unless it

is a single-person business. Some flexibility should be afforded to the beneficiaries to continue its

operation until they can liquidate or sell the business on the most favorable terms.

Sole Business Owner

If your business is a sole proprietorship, your estate plan should include provisions that let

your beneficiaries know how to sell or run the business without you. Your estate plan should also

list the business’s assets and debts, important contacts, and bank account information in a clear

way.

Multiple Business Owners

If several people own your business, a buy-sell agreement should be included in your estate

plan. A buy-sell agreement mandates that upon certain conditions (like the death of a shareholder

or partner), parties to the agreement must sell their shares to the other parties at a fair market

price. Without such an agreement, your beneficiaries may get stuck owning a business they don’t

want and can’t sell, while your partners are stuck with partners they didn’t expect.

Estate planning for business owners is especially important. Without an estate plan, your business may be tied up in probate, during which time the business may lose customers, causing the value of the business to decrease. Be sure to protect your business by including provisions that specifically address your business and what should happen to it after you die.

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Charitable Donations: Leaving a Legacy Many individuals view their legacy as more than the accumulation of financial assets. They

want to be remembered for their charitable giving, for helping others, and for making an impact on society. Many people give meaningful gifts of all sizes or volunteer for all sorts of causes.

Benefits of Giving a Charitable Donation

There are various benefits to making charitable donations, including leaving a charitable legacy and tax deductions—both income tax deductions and potentially transfer tax deductions. The federal estate tax provides a deduction for charitable donations. Additionally, charitable gifts made during a person's lifetime reduce that person's taxable estate, also reducing the ultimate estate tax bill.

Some Ways to Give Charitable Donations

In kind. You may contribute your time or expertise to a charitable organization. In doing this, you get direct experience with the charity and how it uses its resources. That can be vital in determining whether it is a good use of your time and money later on.

Directly. Such gifts can be made during life, or through a will or trust. This may be a good option for any client, especially for those with smaller gifts.

Retirement account gifting. A client can name a charity as a beneficiary to his IRA or employer-sponsored retirement plan. However, certain rules such as spousal approval often apply.

A charitable lead trust. This trust pays income to a charity chosen by the donor for a specified duration. It must be irrevocable and may be set up during life or at death. After that term, the trust principal passes to family members or other beneficiaries.

A charitable remainder trust. This is the reverse of a lead trust because trust income is payable initially to the grantor or other non-charitable beneficiaries for the term of the trust. After that, the principal goes to the donor's chosen charity. Again, this may be set up during life or at death.

Set up a private foundation. Individuals can make tax-deductible donations to a private foundation. Donations may be made during life or at death.

If you want to leave a charitable legacy, you may want to include a charitable donations provision in your will or trust. Such a provision will allow you to dedicate some or all of your assets to a charity upon your death.

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Care for Your Pets by Forming a Pet Trust

More than 600,000 pets are euthanized each year because their owners did not make arrangements for their care. You can ensure this doesn't happen to your pets by creating a pet trust!

Did you know you can create a pet trust to care for your beloved pets? Most people have heard of living trusts and estate planning for humans, but you can also have a trust for your pets. A pet trust is a legally enforceable way to make sure your pets are cared for. Many times, friends or family members have promised that they will look after your pet, but oftentimes, situations change and they may no longer be able to do so. By setting up a pet trust, you create a legal document that holds someone responsible for your pets’ care.

When you create the pet trust, you set aside funds that a trustee—someone you appoint—will use to care for your pets. You also appoint a caregiver, the person who will actually take your pets in and care for them according to your exact instructions. The trustee gives the caregiver funds to use for the pets and oversees that the caregiver is being responsible and following your instructions. Your care instructions can be as specific or general as you want. For example, you can tell the caregiver what kinds of toys to buy, how many times to take your pet to the vet, what kind of food to buy, and that they must keep all your pets together in the same house.

Most of the time, you will create the pet trust while you are alive and act as the trustee and caregiver designated in the trust. You must fund your trust, by setting aside money for the trust. In the trust, you will also designate successor trustees and caregivers to step into your shoes and care for your pets if you pass away. Your pet trust will be in existence for as long as your pets are living. Once they pass away, any money left will go to a "remainder beneficiary," often a charity that looks after animals (but you are free to decide who the money will go to).

Digital Assets

Generally, people believe wills and trusts are exclusively for traditional tangible property,

like real estate, jewelry, and valuable collectibles. As a result, many people fail to include their valuable or significant digital assets in their estate plans. Digital assets are intangible virtual property that are best understood as information, rather than something physical. These assets may include, but are not limited to, digital images, stock photos, audio, video, e-books, as well as your personal online account information for websites or applications. For example, imagine that you created digital copies of treasured family photos that span for several generations, but lost the original prints. You want to make sure those digital family photos are kept safe and in good hands.

In order to ensure that your digital assets are protected, you should include them in a will or trust and designate a fiduciary to execute your wishes. Digital assets are very important to include in your trust because they pose various obstacles that you don't have with traditional property, including passwords, encryption, computer crime laws, and data privacy laws. Any one of these obstacles can make it practically impossible to do anything with those digital assets. The best way to protect your digital assets is to include them in a will or trust and designate a fiduciary to execute your wishes regarding what you want done with those valuable digital assets.

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Residuary Clause: What if Your Estate Plan Doesn’t Address All of Your Assets?

Estate planning is very technical and requires a lot of planning. However, there are

safeguards in place to protect your wishes in case you forgot to address each and every asset you own. One safeguard that every estate plan should include is a residuary clause, which states who gets any assets, or the sale proceeds, not specifically gifted elsewhere within the will or trust.

Essentially, a residuary clause is a catch-all provision that allows a testator (of a will) or a

settlor (of a trust) to ensure that all of his assets pass as he wishes. Assets that are not specifically

gifted elsewhere in the will or trust fall into the catch-all residuary estate. Who receives these

residuary assets is controlled by the residuary clause.

An example of a very simple residuary clause is, “I leave all my other assets, not specifically gifted elsewhere [in my will (or trust)] equally to my two children by right of representation.” Alternatively, a residuary clause can be more elaborate and provide for a variety of unforeseen contingencies. For example, the residuary clause might provide that the first $100,000 of the residue estate goes to the grandchildren in further trust, the next $10,000 goes to certain charities, and the entire remainder of the estate goes to certain other persons based on various percentages, with alternative beneficiaries named.

Without a residuary clause, any later acquired assets, specific gifts which fail, and extra assets that fall into the probate estate will all pass under the laws of intestacy. Be sure that your estate plan includes a residuary clause to keep your assets out of probate.

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PART IV. MAINTAINING YOUR ESTATE PLAN

Updating Your Estate Plan to Reflect Your Ever-Changing Life

Life is always changing. Chances are that after you've created your initial will or trust, your

circumstances changed—you had more children, acquired more assets, or had a falling out with friends. Additionally, the law may change, making some of your estate planning outdated.

Your will or trust should be reviewed at least every three to five years; more often if there is a change in your finances or personal circumstances. You should consider amending your living trust if, for example:

You get married or divorced You have, or adopt, a child You become a grandparent You move to another state You are in bad health Your financial status changes significantly—impending good fortune or experiencing

financial setbacks One of your trust beneficiaries dies One of your named trustees dies or is incapacitated There are changes in the law

You can completely rewrite the trust or have your attorney draft and attach an amendment to change assets, terms, or beneficiaries. The process is relatively quick and straightforward. Be diligent about reviewing your estate plan to ensure that your decisions and instructions are carried out exactly how you want.

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CONCLUSION

In preparing our Estate Planning Guide, Atlantis Law endeavored to provide you with an easily understandable introduction to several important issues and planning techniques involved in the complex area of estate planning. Estate plans are highly personal and vary significantly from person to person. Accordingly, it is important for you to retain an attorney that is capable not only of understanding your needs, wants, and desires for your estate plan, but is also capable of properly incorporating those needs, wants, and desires into a legally enforceable estate plan.

Estate planning is multi-faceted, but our experienced estate planning attorneys are here to

help make your estate planning process as simple and stress-free as possible. To begin making your

estate planning decisions, please complete the enclosed Estate Planning Questionnaire and return it

to Atlantis Law. Upon receipt, our estate planning team will review your information and being drafting your complete estate plan.

We hope to have the opportunity to work with you to create a complete estate plan that will

ensure that the things you’ve worked hard to earn are protected and pass on to your intended heirs.