Practical Tips for End-of-Life Planning – Monterey Herald


Sound advice and a good financial plan can help each of us navigate our lives with greater clarity and confidence. This includes planning for the end of the trip. I know this can be an uncomfortable topic for many, but there are some simple actions you can take now that will help protect you and those you love.

First, make sure you have your basic estate planning documents in place. At the very least, you should have a will and an advance health care directive. A trusted attorney can help ensure that these documents fully reflect your wishes. The California Attorney General’s website also has a great fill-in-the-blank health care advance directive form. The form’s web address is too long to include here, but a web search will take you there.

The advance health care directive allows you to do two things. First, it lets you appoint someone to make health care decisions on your behalf if you become disabled. This decision-making authority is known as a health care power of attorney and the person receiving the authority is known as your proxy.

Depending on how the form is written, the officer will have broad authority, including the ability to consent to or refuse medical treatment, surgical procedures, and artificial nutrition or hydration. If you want to impose specific limits on the power of attorney, I recommend that you hire a lawyer to help you draft the document.

The form also allows you to leave instructions for your health care. For example, you can specify whether or not you want to be resuscitated, artificially prolong your life, or whether you want treatment to relieve pain even if it hastens your death. You can also specify whether you wish to be an organ or tissue donor and for what purpose (transplant, therapy, research or education). Again, if you want to limit your instructions in a specific way, you should have an attorney draft your healthcare instructions.

You can also establish a living trust if the value of your estate is above the California small estate threshold of $184,500. Unless you use a properly designed and funded revocable living trust, an estate worth more than $184,500 will be subject to probate – an expensive, time-consuming and public process. Estates worth less than $184,500 can generally avoid probate. The small estate threshold was changed on April 1 and is updated every three years to reflect inflation.

As a California resident, you can exclude several types of assets when calculating the size of your probate estate: non-California real estate; condominium; assets that pass directly to the surviving spouse; assets that pass outside of probate to named beneficiaries (IRAs, retirement plans, etc.); multi-party accounts or pay-at-death accounts; manufactured or mobile homes or licensed vehicles; any numbered vessel; or assets held in trust, including a revocable trust.

As you calculate the value of the estate, take the time to do a thorough inventory of your various accounts, including where they are held and what they are titled. Carefully review the beneficiaries named on IRAs, retirement plans, and life insurance policies. Sometimes account beneficiaries are not properly updated when life circumstances change. Errors in beneficiary designations can cause huge problems when settling your estate after your death.

If you get older, you can also name someone you trust as a co-owner of a checking account. Having a co-owner will give your estate more flexibility to settle outstanding obligations after you die. Keep the balance of this account to a minimum. Note that a financial power of attorney will not work in this case as it will lapse upon your death.

Be careful not to name your heirs as co-owners on accounts of significant value, especially accounts with low-cost core investments. If they are co-owners, they will not benefit from an increase in costs upon your death.

Steven C. Merrell is a partner at Monterey Private Wealth Inc., an independent wealth management firm in Monterey. He welcomes your questions regarding investments, taxes, retirement or estate planning. Send questions to Steve Merrell, 2340 Garden Road Suite 202, Monterey, CA 93940 or email them to


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