People may forego estate planning because they believe their estate will automatically transfer to their family and loved ones. The individual or entity who will inherit your estate will depend on your properties and relationships with the people you leave behind.
The truth is, you will never really know what will happen to your estate when you die unless you have made the legal and financial arrangements beforehand. You could do this through effective and thorough estate planning. So, here is the question you should really ask yourself: Who do I want to inherit my estate?
Your heirs
Your heirs are the people who have a legal right to inherit a portion of your estate regardless of a will or trust. If you have community property (assets you accumulated during your marriage), the surviving spouse inherits all of it. Your spouse is not an heir in such a scenario because they are legally entitled to the property according to community property laws.
An heir inherits property because of their familial, marital or blood relationship to you. Heirs include children, descendants, or your other close relatives. The person who inherits your separate property or probate property could be your children, other surviving family members, and/or your spouse. In this case, your spouse is also an heir because their right to your estate comes from your marital relationship.
The court will transfer the property to your heirs according to California’s intestate succession laws, which can be very complicated and confusing. Your separate property and any property you do not own jointly will go through probate unless you designate beneficiaries.
Your beneficiaries
A beneficiary is an individual or organization you designate to inherit your property. You can assign a beneficiary for all your assets, including personal and real property. A beneficiary designation is a legally binding arrangement and should be enforceable once you have accomplished the necessary paperwork and state requirements.
Through estate planning, you can decide who will inherit all or parts of your estate and ensure they get their rightful inheritance.