A living trust is a legal tool that allows you to manage your assets during your lifetime and direct how they will be distributed after your death—without going through probate. It's one of several estate planning strategies available to California residents. 

Beware of Estate Planning Scams

While many professionals offer trustworthy help with wills and trusts, there are also individuals and organizations that prey on people—particularly seniors—under the guise of estate planning assistance. These scams often involve:

• Selling generic, one-size-fits-all “living trust kits” that may not meet your legal needs
• Offering “free” seminars to push unnecessary financial products like annuities
• Pressuring consumers into disclosing sensitive information or signing contracts
• Misleading claims that your current assets are at risk and need to be urgently "protected"
• Discouraging you from asking for a second opinion

These scammers may call themselves trust advisors, senior estate planners, or financial experts—and may even impersonate attorneys. Their tactics often include high-pressure sales pitches and misinformation to drive quick decisions. Their real goal is to earn high commissions, not to help you.

How to Protect Yourself and Your Assets

Here are a few key guidelines to follow:

• Verify Professional Credentials: Confirm licenses with the appropriate regulatory agency. Don't trust titles alone.
• Be Skeptical of One-Size-Fits-All Solutions: Every person's situation is unique. Be wary of anyone who says otherwise.
• Understand What You're Buying: Whether it's a trust or a financial product, read the fine print, understand the fees, and ask questions about penalties or restrictions.
• Avoid Pressure to Act Quickly: Never sign anything on the spot that you don't understand. Take the time to consult with a trusted attorney, financial advisor, or family member.
• Be Careful With Annuities and Promissory Notes: These investments may carry risks and fees that are not immediately disclosed. Some are not insured, regulated, or guaranteed.

Legal Requirements and Common Pitfalls

Proper estate planning isn't just about filling out forms. To be legally effective, wills and trusts must meet strict requirements for execution, witnessing, and content. Additionally, for a trust to work as intended, assets must be formally transferred (or "funded") into the trust.

If these steps are skipped or mishandled, your estate plan may be challenged or invalidated in court, defeating its intended purpose.

Know Your Rights

Under California law, you often have the right to cancel certain transactions:

• In-home sales (and other off-premises transactions) can typically be cancelled within three business days. Learn more at dca.ca.gov.
• Annuities purchased if you are 60 or older can generally be cancelled within 30 days of delivery without penalty.

Should You Create a Living Trust?

Deciding whether to create a trust is a deeply personal decision based on your financial situation, family dynamics, and long-term goals. Wills and trusts are powerful legal tools, but they are also complex and must comply with California law. That's why it's essential to work with a qualified estate planning attorney who can guide you through the process and help you avoid costly mistakes.

Why Estate Planning Matters

If you pass away without a valid will, trust, or similar legal plan, your property will generally be distributed according to California's intestate succession laws also known as probate laws.

These rules are complex, but they essentially assign your estate to your surviving family members in a predetermined order based on their relationship to you. In many cases, this may not reflect your actual wishes.

Some assets, however, bypass this legal process altogether. Examples include:

• Jointly owned bank accounts
• Property titled as joint tenancy or community property with right of survivorship
• Life insurance policies with named beneficiaries
• Retirement accounts (e.g., IRAs, 401(k)s) with designated beneficiaries
• Real estate or vehicles with a transfer-on-death (TOD) deed or registration

For these types of accounts, you can typically name or change a beneficiary directly through the bank, insurer, or other institution. When one co-owner of an asset passes away, the surviving co-owner may automatically receive ownership, depending on how the asset is titled. In California, property acquired during a marriage is often considered community property, and may if properly documented pass automatically to a surviving spouse.

If you want to control exactly how your assets are distributed and who will take care of your minor children, you should consider preparing a will or trust. These documents must comply with state laws to be valid and enforceable.

How does a Trust work?

One way to understand how a Trust work is remembering that a Trust is like a Treasure Chest

Imagine you have a treasure chest where you can store your valuable belongings—money, property, jewelry, important papers.

• While you're alive, you hold the key, and you can add things to the chest, take things out, or change what's inside whenever you want. You have control over it.
• You also name a trusted friend or helper (called a "trustee") who will take care of the chest for you if you ever can't do it yourself.
• You can choose for that friend to help you with your treasure chest now while your alive, or not until you pass away.
• You also make a list of who gets what when you're no longer here—your family, friends, or favorite causes.

Now, when you pass away, your helper (the trustee) opens the chest and distributes everything according to your instructions, without having to go through court (called probate). Everything happens privately, more quickly, and often with less cost.

Now, what Happens If You Don't Have a Trust?

Using the same example, imagine If you never put your valuables into a treasure chest and don't leave clear instructions in the chest, when you pass away, everything you own is left out in the open.

At that point someone else has to decide what happens to your valuables, the court has to step in—this is called probate. Think of the court like a referee who now decides:

• What items you had
• Who gets them
• When they get them

This process can take months or even years, can be costly, and everything becomes public record. Your family may also have to deal with delays, legal fees, and potential arguments over who gets what.

Without a trust, you're relying on state law to divide your assets, which may not match your wishes. Some loved ones might be left out entirely, or others may receive more than you intended.

So without a chest (trust), your valuables are left in the open, and strangers (the court) decide who gets what and when.

Get the Legal Guidance You Need

At The Law Office of Steve Lopez, APC, we help individuals and families throughout California create solid, legally valid estate plans tailored to their needs. Whether you're considering a living trust, need to update your will, or want advice on protecting your assets, we're here to help.