Economics
The Perils of Probate
By Tanya Dennis
Money matters. Home, possessions, bank savings and investments dictate the quality of life, and many people live with an intent to leave a legacy to loved ones.
Unfortunately, poor planning can decimate an estate. Some individuals leave a will, believing that their children or spouse will be taken care of.
Instead, children or the spouse face many months or years in probate court, watching estate assets dwindle away to pay attorney fees and court appointed examiners.
Too many families walk away with nothing after going through probate.
The reason may be poor planning. Another reason is that for decades, if not centuries, lawmakers in California have favored court and banking interests.
A will is not sufficient.
To avoid poor planning the next step after a will is to execute a revocable living trust. A will without a trust attached will be “probated” by the state to assure that the will is legal.
This leads to thousands of dollars in probate cost. For example, the average cost of probating a will for a $500,000 estate is approximately $23,000 in attorney and court fees, money that should go to the trustee’s beneficiaries.
The beauty of a revocable living trust is its flexibility and the protection it provides to the person who is the trustee of the trust and the person’s beneficiaries.
When a revocable living trust is executed, all transference of wealth to the trust occurs to the person now designated as the trustee. Although assets have been relinquished to the trust, the trustee as beneficial owner can sell, manage or give away assets and have the option at any point to change terms of the trust, change beneficiaries or even revoke the trust.
Once the trustee die, the revocable living trust becomes irrevocable, meaning what has been written is now etched in stone and cannot be changed.
Unfortunately, having a will and revocable living trust does not protect the trustee’s estate one hundred percent from probate court. Heirs will lose protection from probate court if the will or trust is contested, meaning that a family member fails to honor the wishes of the deceased and challenges the validity of the will or trust.
The majority of the time the will and trust are upheld in court, but meanwhile thousands of dollars or more are lost to the court. To avoid this from happening, it is imperative that family members sit down together and final wishes clarified.
This is the time to settle any dispute.
It is also helpful that family members have a copy of the will and trust, so that each item in the will and trust is discussed.
To discourage family members determined to contest the trust, insert a clause that anyone contesting the will and trust will receive one dollar for their efforts and lose any other benefits previously written in the will and trust.
An ounce of prevention can head off problems. When executing a will and revocable living trust, it is imperative that wishes of the deceased are honored and loved ones effectively avoid probate court.
A will and revocable living trust protects loved ones when they are most vulnerable.
Next week: Probate Court Drains Assets
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Oakland Post: Week of April 24 – 30, 2024
The printed Weekly Edition of the Oakland Post: Week of April 24 – 30, 2024
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Business
Black Business Summit Focuses on Equity, Access and Data
The California African American Chamber of Commerce hosted its second annual “State of the California African American Economy Summit,” with the aim of bolstering Black economic influence through education and fellowship. Held Jan. 24 to Jan. 25 at the Westin Los Angeles Airport Hotel, the convention brought together some of the most influential Black business leaders, policy makers and economic thinkers in the state. The discussions focused on a wide range of economic topics pertinent to California’s African American business community, including policy, government contracts, and equity, and more.
By Solomon O. Smith, California Black Media
The California African American Chamber of Commerce hosted its second annual “State of the California African American Economy Summit,” with the aim of bolstering Black economic influence through education and fellowship.
Held Jan. 24 to Jan. 25 at the Westin Los Angeles Airport Hotel, the convention brought together some of the most influential Black business leaders, policy makers and economic thinkers in the state. The discussions focused on a wide range of economic topics pertinent to California’s African American business community, including policy, government contracts, and equity, and more.
Toks Omishakin, Secretary of the California State Transportation Agency (CALSTA) was a guest at the event. He told attendees about his department’s efforts to increase access for Black business owners.
“One thing I’m taking away from this for sure is we’re going to have to do a better job of connecting through your chambers of all these opportunities of billions of dollars that are coming down the pike. I’m honestly disappointed that people don’t know, so we’ll do better,” said Omishakin.
Lueathel Seawood, the president of the African American Chamber of Commerce of San Joaquin County, expressed frustration with obtaining federal contracts for small businesses, and completing the process. She observed that once a small business was certified as DBE, a Disadvantaged Business Enterprises, there was little help getting to the next step.
Omishakin admitted there is more work to be done to help them complete the process and include them in upcoming projects. However, the high-speed rail system expansion by the California High-Speed Rail Authority has set a goal of 30% participation from small businesses — only 10 percent is set aside for DBE.
The importance of Diversity, Equity and Inclusion (DEI) in economics was reinforced during the “State of the California Economy” talk led by author and economist Julianne Malveaux, and Anthony Asadullah Samad, Executive Director of the Mervyn Dymally African American Political and Economic Institute (MDAAPEI) at California State University, Dominguez Hills.
Assaults on DEI disproportionately affect women of color and Black women, according to Malveaux. When asked what role the loss of DEI might serve in economics, she suggested a more sinister purpose.
“The genesis of all this is anti-blackness. So, your question about how this fits into the economy is economic exclusion, that essentially has been promoted as public policy,” said Malveaux.
The most anticipated speaker at the event was Janice Bryant Howroyd known affectionately to her peers as “JBH.” She is one of the first Black women to run and own a multi-billion-dollar company. Her company ActOne Group, is one of the largest, and most recognized, hiring, staffing and human resources firms in the world. She is the author of “Acting Up” and has a profile on Forbes.
Chairman of the board of directors of the California African American Chamber of Commerce, Timothy Alan Simon, a lawyer and the first Black Appointments Secretary in the Office of the Governor of California, moderated. They discussed the state of Black entrepreneurship in the country and Howroyd gave advice to other business owners.
“We look to inspire and educate,” said Howroyd. “Inspiration is great but when I’ve got people’s attention, I want to teach them something.”
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Oakland Post: Week of April 17 – 23, 2024
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