What to Do with your Estate Planning Documents

What to Do with your Estate Planning Documents

If you have all of your estate planning documents in order, great job! You’re ahead of many other people who haven’t gotten around to it yet, and your family will have the support and information they need if something happens to you. If you still need to set up some documentation in California, take a look at this checklist to help get you started.

Once your estate planning documents are ready, there’s another crucial step to follow. You need to find a safe place to store them and let your family know how to access them. If you lock the only copy of an important document in a box and hide it under some junk in the attic, your family might not be able to follow through with your instructions when the time comes. The result could be a mess of stressful arguments and litigation.

If no one can find a copy of your last will and testament, the law usually presumes that you destroyed or revoked it. If an older copy is found, it might be used instead. If no version is found, California Intestate Law will determine who is entitled to your property for you. These results might vary considerably from what you had planned.

In 2016, BMO Wealth Management polled 1,008 Americans about the state of their estate planning documents. Only one third of them responded that their heirs knew where the documents were kept, and only a tenth of them had given their heirs a copy! Let’s improve these statistics by making smarter decisions with our important legal paperwork.

Image courtesy of BMO Wealth Management.Secure the Originals

It’s crucial to keep the original copies of your estate planning documents safe. The court may not accept digital or paper copies of the originals, especially in the event of a dispute. Many states also won’t accept copies of healthcare proxy and power of attorney documentation.

Store an original document in its own marked, sealed envelope. This will keep pages from being misplaced or mixed in with other paperwork. A great place to keep these envelopes is in a fireproof, locked safe within your own home. You can let your attorney or bank store them for you, but these aren’t the best options for emergency paperwork that your family might need at a moment’s notice, such as medical proxy documents. State laws and bank policies affect who can access your bank box, even after your death, so make sure that the important documents can reach the family members who need them without requiring court orders.

Provide Copies

Several people should have access to copies of your estate planning documents. Your financial and legal advisors should each have a copy, including your accountant and attorney. These people play a neutral role in your decisions, and can give you and your family good advice, such as when your documents need to be updated. You should also give copies to trusted members of your family, particularly the ones who are listed within the documentation. If you don’t trust them with copies, you need to at least inform them about the location of the originals.

Disclose the Location

In addition to your spouse, you must disclose the location of the original estate planning documents to certain other people. Again, your accountant, attorney, and trusted family members should all be aware of the originals’ locations. This will ensure that the information is available and the documentation can be put into the right hands in the case of an accident that affects both you and your spouse. Also make sure that your close family knows the safe combination, key location, and/or contact information for your attorney so that they can access the documents in a pinch.

Update When Necessary

Depending on how your circumstances change over time, an outdated set of estate planning documents can be almost as bad as no documentation at all. Make sure that you update your will, power of attorney, and other important documents when a major life change occurs. After changes are made, destroy the old documents so that no confusion occurs over your current wishes. You also need to track down and make sure that every copy is destroyed and replaced by the updated version. If you change who you use as a financial or legal advisor, make sure that your new professionals have current documents and your family knows who to contact.

Does your family know what to do in case you have an emergency? Are the originals of your estate planning documents safe and secure? Does each person who needs a copy have an up-to-date version and know how to access the originals when necessary? If you said no to any of these questions, it might be time to reconsider how you are handling your important documents.

At the Law Firm of Hathaway, Perrett, Webster, Powers, Chrisman & Gutierrez, we have handled thousands of estate plans, and we know how to keep your documents safe! We catalog and store your original documents in a fireproof location. We provide an organized copy of your estate planning documents, together with information on what to do when the time comes to use these documents. If you would like more information on how an estate plan can help your loved ones when you are gone, or have estate plan questions in general, call Dan Higson today at 805-644-7111!

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Accidents with an Uninsured Driver in California

Accidents with an Uninsured Driver in California

No matter how carefully you drive, accidents happen. You can’t control every factor around you, such as road conditions and other drivers. The State of California requires that everyone who operates a vehicle must have proof of financial responsibility, such as automobile liability insurance. However, studies by the Insurance Research Council have shown that as many as 1 in 7 drivers are uninsured. Car insurance is supposed to help cover the costs of medical and repair bills, but what happens when there’s an uninsured driver involved?

California Insurance Requirements

There are liability insurance requirements for all private passenger vehicles in California. The minimum requirements follow a 15/30/5 arrangement by covering:

  • $15,000 for injury or death of a single person.
  • $30,000 for injury or death of multiple people.
  • $5,000 for property damage.

An at-fault driver is liable for any claims that exceed these numbers. It’s important to choose the right insurance policy for you when deciding whether or not to stick with the minimum requirements. The California Low Cost Automobile Insurance Program provides a source of relatively cheap insurance.

If you want another option, there are other sources of proof of financial responsibility, such as:

  • $35,000 cash deposit to the California Department of Motor Vehicles.
  • $35,000 surety bond from a company licensed for business in California.
  • A certificate of self-insurance from the DMV.

Uninsured Drivers and Non-Economic Damages

Uninsured drivers in California are barred from receiving compensation for non-economic damages when he or she is the victim of a motor accident. Non-economic damages include:

  • Disability
  • Disfigurement
  • Pain and Suffering
  • Decreased Quality of Life
  • Loss of Wages

The only exception to this rule is if the at-fault driver was under the influence of drugs or alcohol at the time of the accident and was convicted of a DUI.

Uninsured Motorist Coverage

If you are in a collision with an uninsured driver, there are several possible ways to receive compensation:

  • Collision Coverage
  • Medical Payments Coverage
  • Health Insurance
  • File a Lawsuit
  • Uninsured Motorist Coverage

Although you are not required to have Uninsured Motorist Coverage in the State of California, it comes as an option with most insurance. It will help pay your medical bills, economic expenses, lost wages, and non-economic damages in the case of an accident with an uninsured driver. Uninsured Motorist Coverage takes the place of the liability coverage that should have been the at-fault driver’s responsibility. The coverage often has the same limits as regular insurance, but you should check your policy to make sure.

In California, up to 70% of all auto accidents are caused by an uninsured driver. Yet the insurance industry continues to advise their insured members to purchase inadequate uninsured motorist coverage. For many policies, the additional premium for adding $1,000,000 in uninsured motorist coverage is minimal. If you are injured in a car accident due to the negligence of the other driver, that driver will most likely not be uninsured or have a minimum insurance policy.

Bottom line: Get substantial Uninsured Motorist Coverage on your auto insurance policy. It may cost you as little as $30 to $50 dollars per year. It is the best investment you will make, and your insurance company probably won’t tell you about it without prompting.

Making a claim with Uninsured Motorist Coverage is different than a normal claim. Your relationship with the insurance provider changes. You must negotiate a settlement as if you were dealing with another person’s insurance. Because of this, it is a good idea to have an experienced personal injury lawyer represent you in this situation.

The process of filing an insurance claim involving an uninsured driver can be complicated and stressful. Insurance adjusters may underestimate the value of compensation you deserve for injuries and damages. If you are looking to negotiate with an insurance provider after an automobile accident or have other questions concerning a personal injury case, call Dan Higson today. And make sure you get Uninsured Motorist Coverage on your auto insurance immediately!

Payless ShoeSource Files Chapter 11 Bankruptcy

Payless ShoeSource Files Chapter 11 Bankruptcy

Brief History of Payless ShoeSource

Payless ShoeSource is an American discount shoe retailer based in Topeka, Kansas. Cousins Shaol and Louis Pozez established the company in 1956. The stores became more widespread in the 1980’s as a result of its Pro Wings brand. These shoes were notable for the use of Velcro instead of shoelaces. Recently, the company has established over 4,400 locations in more than 30 countries.

As of 2012, Blum Capital and Golden Gate Capital privately own Payless ShoeSource. Unfortunately, the company has struggled in the following years. In 2016, it closed all of its stores in Australia. This destroyed around 730 jobs. On April 5, 2017, Payless ShoeSource filed for Chapter 11 bankruptcy. As a result of the reorganization, the company decided to close over 400 locations within the United States. The closures hit the West Coast hard, since nearly 50 of these failed stores were in California. The timing of store closures depended upon each location. A complete list of Payless ShoeSource closing store locations can be found here.

Chapter 11 Reorganization

By filing for Chapter 11 bankruptcy, Payless ShoeSource will attempt to reorganize the company in order to have a stronger footing going forward. The company plans to reduce its debt by 50% and lower the interest payments. According to Payless, lenders have agreed to pay up to $385 million to keep the rest of the stores operational.

Modern Retail Store Struggles

When asked about the bankruptcy case, Payless ShoeSource Chief Executive Paul Jones stated, “This is a difficult, but necessary, decision driven by the continued challenges of the retail environment, which will only intensify.” In the modern age, many brick and mortar retail stores are seriously struggling. Shoppers tend to make purchases online or at discount outlets. Even discount stores such as Payless ShoeSource are failing to keep up.

2016 and 2017 have been full of bankruptcies and store closures for many companies. Clothing companies are also having problems staying open. Teenage clothing store Wet Seal attempted Chapter 11 reorganization in 2015. However, it completely failed by 2017, closing all locations and terminating all employees. The Limited filed for Chapter 11 bankruptcy in early 2017 and decided to close all brick and mortar locations. The company will continue to provide online sales, but many jobs were lost in the process.

With the rise in online sales and so many stores closing across the United States, it’s hard to imagine a revival of brick and mortar stores and shopping malls in the future. Many of the businesses that want to remain successful will have to adapt to the changing sales environment of the 21st Century. Hopefully Payless ShoeSource can use this Chapter 11 reorganization to find a place for itself in modern retail business.

RadioShack’s Rollercoaster History of Boom and Bankruptcy

RadioShack’s Rollercoaster History of Boom and Bankruptcy

The Beginning

RadioShack is an American chain of electronics stores that has experienced both highs and lows throughout its long history. Brothers Theodore and Milton Deutschmann founded it in 1921 to sell ham radio equipment. The company originally consisted of a single location for retail and mail order sales. RadioShack issued its first catalogue in 1939, and even extended into the high fidelity music market by producing its own private label products with the brand name Realist. Throughout its history, the company constantly attempted to rebrand itself, changing its name, slogan, management, and purpose time after time.

Bankruptcy and Changing Strategies

By the 1960s, RadioShack had expanded its mail order business and had 9 stores. Soon the company fell on hard times, however, and had to file for bankruptcy. Luckily for RadioShack, entrepreneur Charles Tandy took an interest and bought the company for $300,000 in 1962. Tandy Corporation was interested in expanding their leather goods company into other hobby businesses. In order to make RadioShack viable again, Tandy ended the mail-order business and credit sales and dropped most of the upper management positions. Tandy led the ailing company through a period of growth and success in the ‘60s and ‘70s before his death.

In the ‘80s, RadioShack attempted to edge into the IBM PC compatible market. This didn’t last long though, as the company struggled against rivals like Dell. In 1982, people were moving towards owning their own phones instead of renting them after the breakup of the Bell System, and RadioShack jumped on board by offering 20 different models of home phone.

In the ‘90s, RadioShack once again attempted to change, this time having to restructure over 200 store locations. The company wanted to shift away from components and cables towards more mainstream consumer electronics. It continued to do so into 2015 by selling things like cell phones. In 1994, the company began to offer inexpensive, non-warranty repairs for over 45 brands of electronics. In 1998, RadioShack claimed to be the largest seller of consumer telecommunications products in the world. By 2011, smartphone sales accounted for over half of the company’s revenue.

2015 Chapter 11 Bankruptcy

Unfortunately, management issues and tough competition led to several bouts of restructuring, purging of management, and financial instability after the turn of the century. In 2005, a switch in the wireless providers that RadioShack featured caused a huge decline in profits. This along with management problems led to several cuts in 2006. Nearly 500 stores closed down, and stock prices plummeted. The company also attempted to cut overhead expenses by laying off a fifth of its headquarters workforce.

Since 2006, RadioShack has continued to close more stores and lay off more people. At the beginning of 2015, the company faced over $1 billion in debt and filed for Chapter 11 bankruptcy in the hopes that another restructuring would save it. Late in 2015, the bankruptcy plan was approved, and RadioShack began the liquidating funds to pay off its creditors. The chain was forced to close nearly all of its remaining 4,000 stores.

In September of 2015, many problems still faced RadioShack’s Chapter 11 plan. Standard General LP and Wells Fargo claimed that RadioShack was obligated to pay the substantial legal fees accrued from lawsuits with junior creditors, estimated at around $15-20 million. This stipulation would have probably led to the collapse of all of the creditor repayment plans. Luckily, the junior creditors decided to drop the lawsuit instead.

2017 Chapter 11 Bankruptcy

As part of the restructuring plan, Standard General bought RadioShack’s brand and saved around 1,700 stores. Standard General, Wells Fargo, and other banks provided $9.4 million in cash and savings to a liquidation trust. As part of the RadioShack restructuring, the company has switched focus to pushing the Sprint brand for mobile phones.

Standard General created an affiliate company called General Wireless to operate RadioShack’s brand and assets along with Sprint. Together, Sprint and General Wireless opened co-branded stores under Sprint’s name that sold products from both brands.

In March, 2017, RadioShack was forced to close 187 more stores. This accounts for about 9% of its remaining 1,943 locations. This move affected around 1,850 of the company’s 5,900 employees. The company again filed for Chapter 11 bankruptcy, and stated plans for closing many of its locations that are shared with Sprint.

Sprint also paid $12 million as a “wind down payment” to General Wireless. In return, Sprint received the leases for 115 stores and the equipment from 245 other locations where Sprint was primarily in control.

Time will tell if Standard General and General Wireless will manage to salvage anything from RadioShack’s remains. For now, the company retains control of over 1,000 locations. If the struggles continue, this longstanding household name might go down in history as yet another company that failed to keep up with the speed of modern technological advances.