Estate Planning with Anna Serrambana
During this 25 minute interview, we discussed a lot of really valuable and eye opening aspects of Estate Planning. Here is how the conversation went:
- Introduction to Anna Serrambana
- What is Estate Planning?
- What is Good Estate Planning?
- What is Bad Estate Planning?
- Who Should Think About Estate Planning?
- What Can Go Wrong if you Don’t Plan?
- Is how I hold title part of estate planning?
- How Do I Get Started? What Does it Cost?
Introduction to Anna Serrambana
Anna Serrambana earned her J.D. Degree from Western State University of Law in 2003.
Anna joined a small private law firm in Huntington Beach after passing the bar exam, where she worked for three successful years in the field of estate planning, family law, and civil litigation.
Anna believed that in starting her own practice, she could be more effective in helping people deal with a variety of legal issues. In 2007, she founded A & R Law Group.
Since then, Anna has represented numerous clients in State and Federal Courts. In 2018, Anna joined forces with attorney Christine Kingston to form Surf City Lawyers.
Surf City Lawyers has allowed Anna to fully realize her passion for helping people at all levels of litigation and protection.
Attorney Serrambana is a legal mentor to young lawyers and provides litigation support to other firms on an outside counsel basis.
Anna is active in a number of professional organizations including the California Bar Association, a member of the Orange County chapter of NAWBO (National Organization of Women Business Owners), and a member of the Orange County Bar Association.
Anna treats every client with respect and integrity.
Scott: Hi everybody. Thanks for being here. My name is Scott Schang. I am a branch manager here at BuyWise Mortgage in Huntington Beach, where our goal is to teach consumers how to buy wise, borrow smart, and build wealth.
That is precisely why I’m really excited today to have Anna Serrambana on with me. Anna is an attorney specializing in probate and estate work here in Huntington Beach.
Let me just tell you a little bit about Anna real quick. First of all, hi Anna.
Anna: Hi, thanks for having me.
Scott: Good morning, yes of course.
Anna: Good morning.
Scott: Anna earned her JD degree from Western State University of Law in 2003. She joined a small private firm in Huntington Beach after passing the bar exam the first time, correct?
Anna: That’s correct.
Scott: Yes, all right. Hey you got to celebrate the small victories, right?
Anna: Exactly, thank goodness.
Scott: You really focused on the field of estate planning, family law, and civil litigation. Anna really believed in starting her own practice.
She could be more effective in helping people deal with a variety of legal issues. In 2007, you founded A&R Law Group.
Then since then, you’ve represented a lot of clients in both state and federal courts. In 2018, Anna joined forces with attorney Christine Kingston from Surf City Lawyers.
I don’t know if anybody remembers a series of interviews I did with Christine. We’ll definitely get her back on here. She is an absolutely amazing woman as well, and attorney.
Scott: Surf City Lawyers has really helped Anna to realize her passion for helping people at all levels of litigation and protection.
You also do a lot of legal mentoring to young lawyers, and provide litigation support to other firms on a counsel basis, correct?
Scott: You are an active member of the professional organizations including the California Bar, and the Orange County Chapter of the National Organization of Women Business Owners, and you’re also a member of the Orange County Bar.
Man, how do you find time to even do stuff like this? You’re awesome. You’re amazing.
Anna: Thank you.
Scott: No, it’s my pleasure. It’s absolutely a pleasure. Again, I met Anna through Christine as a mutual friend. We sat down for a little while.
It was probably what, 15, 20 minutes into it, and I had this weird look on my face, and I said, “You know what? I want to jump online, and I want to interview you, and I want to talk about estate planning,” because we hear about estate planning all of the time, but I’m not really sure … I mean, I personally don’t even really know what that means.
I know I’ve encountered aspects of it. I guess, I’m embarrassed to say that I don’t have an estate plan if I don’t know what one is, is that … right?
Let’s start off with the obvious, what is estate planning?
What is Estate Planning?
Anna: Estate planning is a process where individuals, or married couples can decide how they want their assets divided once they pass away, who they want to handle their assets if they become incapacitated, or when they pass away, and who’s going to take care of their kids if they were to pass away before their kids turn 18.
It’s a lot of different things all encapsulated in estate planning. Estate planning can also encompass tax planning. You could best utilize tax savings that are out there, but that’s mostly for large size estates.
Anna: Most estate planning for individuals is going to be who’s going to take care of my kids, where are my assets going to go once I pass away, and I want control over how that’s going to be distributed, ’cause I don’t want my 18-year-old son to inherit a million dollars at 18, ’cause he probably won’t know what to do with it.
Scott: It’ll cease to be a million dollars very quickly, potentially, right?
Anna: That’s correct.
Scott: All right, I sort of did something like this with my mom just recently, just earlier this year. I flew out there and that’s what we had to do.
It’s not always a comfortable situation to have that conversation to family members, but it’s absolutely essential.
I can tell you by going through this with my mom, and my brother, there’s just two of us, it’s kind of emotional too, right?
Anna: It absolutely is.
Scott: You’re talking about you know, what happens when you pass. You’re facing that mortality. Now, I would imagine as with absolutely everything else out there, that there’s … not all estate planning is the same. Let’s start by what is good estate planning? What should it look like?
Anna: Okay, so good estate planning is going to go very in-depth. Good estate planning is going to not only who is going to get my assets, but at what stage in life are they going to get my assets.
If that person passes away before me, then where are my assets going to go? It’s going to include two, three, four layers deep.
Good estate planning is going to include funding a trust so that your assets don’t go through probate, ’cause probate’s very expensive. It takes a very long time in California. Good estate planning is going to ask the hard questions.
Anna: I know people don’t like to think, “If I pass away, who’s going to take care of my kids?” But not just who’s going to take care of my kids, it’s also, “How do I want my kids raised?” Do they get to go to private school? Do you want them raised in a certain religion?
Do they get to play extra-curricular activities? What are those major life decision that you’re going to make for your children, so that the person who’s taking care of them has some kind of guidance, and doesn’t have to make these hard choices alone.
Scott: Now, this next question kind of leads into the … Well I have a question before I go into the next question, and it’s that sounds like it’s a fairly lengthy, and complicated process. I mean, it could definitely be complicated if you didn’t have somebody like you walking them through it obviously, but how long does this process take typically when everybody is engaged and focused on this is what we’re going to be working on?
Anna: Right. I mean it sounds like a daunting task, but it’s actually not. Most people, when they’re done, tell me, “I wish I would have done this sooner had I known it would have been this easy.”
Yes, you have to make hard choices, but we sit down in a meeting, and we discuss everything. A lot of my clients ask for my guidance.
They say, “I don’t know who should take care of my kids,” and then I start asking questions about family members, and friends, and what their beliefs are-
Scott: You don’t just pull out a coin and start flipping? It doesn’t work that way?
Anna: It doesn’t work that way, in most cases.
What is Bad Estate Planning?
Scott: Well I think that goes into my next question then is, is the best way, I think, to understand what good estate planning, is to also understand what bad estate planning is. Give me an example of what a bad estate planning look like.
Anna: Well, to go back to your other question about how long it takes, real quickly, I’ll say the process is about two weeks, bad estate planning is going to be where the process is dragged out even longer. That’s what happens when people aren’t engaged.
The attorney isn’t engaged, the clients are engaged, and the attorney kind of isn’t taking an active role in helping the client make these tough decision, because I mean, honestly, nobody wants to talk about death, and nobody wants to talk about the what ifs, but if you have an attorney holding your hand, and helping you, then it makes it easier.
Bad estate planning is going to be where it gets dragged out. Bad estate planning is going to be where your trust doesn’t get funded. Bad estate planning is going to be where it’s just a single level, “My assets are going to go to Bob,” and your paperwork isn’t going to-
Anna: It’s not going to address what happens if Bob dies.
Scott: Now is there, I don’t know what’s the best way to say this, but on the polar opposite of it dragging out and taking forever, is there … there’s online services for everything, are there online services that claim that you can fill out a form, and you just estate planned? Is that a thing?
Anna: Oh absolutely. It absolutely is. I’ll throw them out there, LegalZoom, Nolo, Rocket Lawyer, yeah-
Scott: Oh, anything with rocket in it is bad, we know that. [crosstalk 00:09:35]
Anna: Yes exactly, exactly. There are services out there, and everyone thinks … well not everyone, but a lot of people think that it’s the cheaper, faster way to go, but I’ve reviewed many of the Legal Zoom estate plans, and estate plans done by NOLO, and some of them aren’t funded. They prepare the deed for you to record, but they rely on you to go get it notarized, to-
Scott: You were telling me about that.
Anna: Yeah. Then people pass away, and they think they’re okay, they think they have a trust, and it’s pretty much worthless, because nothing was ever put into the trust. Then you’re going through probate, and you still have to pay for the LegalZoom.
Scott: A big part of the do-it-yourself is that you got to do it yourself, and if you don’t know what you don’t know, you might not be doing what you need to be doing.
Who Should Think About Estate Planning?
Scott: This is a question that I have, is who should be estate planning? I mean, what if I don’t have any assets? What if I got a crappy car, and a record player, and a thermos, you know? And that’s all I have, and that’s all I need. I mean who needs to estate planning?
Anna: Anybody who’s 18 and older needs to some form of estate planning. They may not need a trust. They may only need a power of attorney, because if they get incapacitated, who is going to pay their bills while they’re incapacitated?
Kids go off to college, they’re 18, something medically happens to them, they get into an accident, well mom and dad can’t access medical records, because that person’s an adult now, so there’s confidentiality.
If you don’t have advance healthcare directive, or a healthcare power of attorney, mom and dad can’t … will not have information, or won’t be privy to that healthcare information when they go to the hospital to visit their son or daughter. Everyone who’s at least 18 years of age should have-
Scott: So it’s not just about … It’s not a just about who gets your stuff-
Scott: I mean, it’s about everything. It’s about if you get incapacitated, if you get a medical emergency, if you’re unable to respond do you want to stay on life support, like that kind of stuff, right?
Anna: Absolutely. Those tough decisions. Estate planning can just … it can be just that simple. Even if you don’t have any assets, you should still have something in place.
Scott: Well, let’s go a little dark here, and let me just ask you, what’s the worst case scenario? I mean, what happens if I don’t? I don’t want to do that, two weeks sounds like a long time.
Anna: Right, right. Well, if you don’t do any estate planning and you have a house in California, it’s going to go through probate. That’s worst case scenario if you own a home. Probate in California is very expensive.
If you own a home worth 500,000, it doesn’t matter if there’s a $500,000 mortgage on it, the price of going through probate is still going to be about $16,000, and it’s going to take over a year. Your kids are not going to get money. No one’s going to get any access to any money at all.
The home is going to have to be sold, the process is very long, tedious … oh, and it’s public. Everything is published in Orange County courts, or any court in California.
What Can Go Wrong if you Don’t Plan?
Scott: Okay. Do you have any really short horror stories that you had recently that make a … that are a good example?
Anna: Oh, I actually [crosstalk 00:13:00] oh no, no, no, I have a real good horror … not a real … I don’t want to say good, but [crosstalk 00:13:05]
Scott: Good example.
Anna: Yes. I have a good example. Somebody recently did a trust, they knew they were dying. She signed it two days before she passed away.
The home was transferred into the trust, but because she died so quickly, she didn’t have enough time to put her bank accounts into the trust.
Well, her successor/trustee was going to handle that for her, unfortunately successor/trustee fell in the shower and passed away two days after the trustee died-
Anna: Yes. And so $815,000 is sitting in a Bank of American bank account right now, and not in a trust. Now even though she had a trust, that part of her estate’s going to have to be probated. The cost of-
Scott: Did they have heirs?
Anna: They have heirs, yes. But the cost of doing-
Scott: They are powerless right now.
Anna: They’re powerless. They’re powerless. I mean, they’re going to get the money eventually, but it’s going to go through probate. It’s going to cost them a fortune, and it’s going to take a very long time.
Scott: You don’t need that kind of stress on top of the stress of losing what sounds like both their mom, and their dad within a period of a couple of days.
Anna: Yeah. It was actually their aunt, and their mom within a few days of each other. Now they’re doing two funeral services, and having to deal with all of that, and then dealing with the banks, and dealing with selling the two homes now. It was just a nightmare.
Scott: I guess I shouldn’t have asked, ’cause now I’m sad.
Is How I Hold Title Part of Estate Planning?
Scott: Let’s talk … I’m a mortgage broker, been in the business for 20 years, so I deal with people buying homes. It’s interesting, ’cause when I have conversations with people about buying real estate and owning real estate, I’m always talking to them about five, 15, 20 years about making smart decisions now, and what that means in the long term.
That’s kind of the opposite of what we mentioned the rocket-thing, these people, they don’t care, they’re just slinging loans out there, but that is the single most important asset that’s probably the largest asset that most people have, and that a lot of times is their retirement, it’s the wealth that they pass onto their heirs.
Scott: Let’s spend the rest of this interview kind of talking about how you protect yourself.
The first thing, and we get a lot of questions about this, and I thought I was giving good advice, which was basically, don’t take my advice, you need to talk to an estate planning attorney, but I thought I knew the right way, but let’s talk a little bit about holding title, and how you hold title, because any time you refinance, or you buy, you get this paper, and it says, “How do you want to hold title?” Nobody knows how to hold title, they’re like, “What do I do?”
Anna: Right. The right way to hold title, depends on the relationship of the people owning the property. If you’re married, then you want to hold title as community property with right of survivorship.
The reason for that is because in California, you can actually bequeath your share of the community property to somebody else.
It’s happened a few times in my career, where let’s say wife comes in and says, “I don’t want my husband to inherit my half of the property. I want to …” Oh yeah. “I want to put my half, or I want to give my half to the cabana boy.”
Scott: That’s where I was going with it, I didn’t know if you were going to go there. I was going to … Oh boy, whoo.
Anna: Oh yeah, oh yeah.
Scott: That’s a good one.
Anna: But if you have with right of survivorship, then if one spouse dies, the other spouse is automatically going to inherit. That’s key, because most times that I find married couples are taking title as joint tenants, and they shouldn’t do that.
There’s negative tax consequences to doing that, and you don’t get the benefits of the community property with right of survivorship.
Scott: How do you hold-
Anna: Oh go ahead.
Scott: How you hold title is both survivorship is how you transfer survivorship and tax, and how the property is taxed upon transfer of survivorship, right, or after the transfer?
Anna: That’s correct, because after the first spouse dies then the surviving spouse will get a step up in bases. That’s the best of all worlds really.
Unless they came into their marriage with separate money, and they want to keep it separate, or they have a pre-nuptial agreement, then those are the odd scenarios where obviously you’re not going to take title as community property with right of survivorship, but for the most part, married couples should take it as community property with right of survivorship.
But if you have unrelated people who buy property together, brother and … well even brother and sister, or friends, such as that, then you want to take title, usually as tenants in common.
Anna: The reason for that is because you own your share, whatever the percentage is, and the other person owns their share. You can give away your share to whoever you want. You can put it into your will, you can put it in your trust.
If you own property with your brother, and your brother gets into a car accident, and gets sued, they can only go after his half of the house. They can’t go after your half of the house. But if you were to own it as joint tenants, then they would be able to come after the entire house.
That’s why, unless you’re married, a married couple, or you have some kind of agreement with somebody, usually you should take title as tenants in common.
Scott: Okay. Now, I see a lot of times that people will come, and they’ll refinance and the home is in a trust. I assume that having the home in a trust now typically when we’re refinancing what we’re doing is most lenders, Fannie Mae, Freddy Mac, FHA, they don’t allow you to do the loan in a trust, so the loan is coming out of the trust temporarily, but we’re also drawing the paperwork to put it back into the trust, that’s another thing that if you’re not working with an experienced, or a professional loan officer, they don’t understand these things, and they could hang you out to dry, and essentially, put your trust at risk, or have your home outside of your trust, which defeats the purpose. Talk to me a little bit about the benefits of a trust, and why you need one, and why you need it, what the benefits are.
Anna: Okay. Okay. The biggest benefit is that your estate won’t have to go through probate. The transfer is immediate. When the person who created the trust passes away, immediately the successor/trustee is going to take over.
In fact, the successor/trustee can take over if the trustee becomes incapacitated, or just decides, “I’m 90, and I don’t want to deal with it anymore, you take over.” It’s very seamless process. It’s very easy. It doesn’t cost a ton of money, and it’s private.
Remember I said that probate’s very public? You don’t record your trusts, so it’s very private. People don’t get to see it until after you’ve passed away. You save money on the probate.
You save time from going through probate. Oh, go ahead, you had a question?
Scott: And keep the government out of your stuff.
Anna: Yeah, you get to dictate who is going to receive your assets, and you get to transfer those assets after your death. It’s almost immediate. You have to pay creditors, and do a few steps, but the process is much shorter than probate.
How Do I Get Started? What Does it Cost?
Scott: Okay. Okay. Is there anything else that you think is really, really important that you think people need to understand?
I mean this is amazing. We wanted to try to keep this kind of short, and you packed in a lot of really great information.
Now you got me thinking that I’m going to have to schedule an appointment and do some estate planning.
What would you want to leave people with? I just want everybody to know, we’re going to put … we’re going to have this … I’m going to have this published.
Scott: If you’re watching this video, I will link it to an article. I’m going to have links to Anna’s website. We’ll put a link on there to the best way to hold title, you’ve got a really good document on there.
Obviously, don’t do it yourself, but what would you leave people with if they’re still on the fence. I can’t imagine they would be, but what would you leave people with as a final word on estate planning?
Anna: I think it’s something that everybody should consider. The process is simple. Don’t be afraid of it. At least begin the discussions with your family to make those choices, ’cause I guarantee you, once you start having these conversations, they’re not as tough as you think.
Don’t let the daunting aspect of it overwhelm you, because once you start, it’s very, very simple, and it’s very cost effective if you find the right attorney.
Scott: That’s a good point, and I didn’t ask you that. Can you give me like a price range of what you can expect, or you can say how much you charge I guess, but what typically is the … how much does something like this cost?
Anna: Well, I mean, attorneys have a wide-range of costs, so I can give you what I’ve heard out in the industry, of a ballpark. It depends on also the level of planning that you need, but between $750 up to $10,000.
Again, depending on the complexity of your plan. Most, 90% of the people that come into my office need the plan that’s in the ballpark of 1100 to 2000.
Scott: Oh, that’s not much at all.
Anna: It’s not much at all. It’s a flat rate. You don’t have to worry about, “Oh, I better not call my attorney, ’cause the clock is going to be ticking.” It’s a flat fee. It includes everything that you need, except for the notary, that’s the only thing that’s not included.
But for that, you get my undivided attention as many times as you need it, until we’re done.
Scott: Wow. That’s absolutely amazing. I love that, I love that, that you’ve encapsulated this into a flat-rate. So even if it’s on the higher end, and it’s more complicated, are you still able to kind of come up with a flat rate based on what kind of amount of work you’re projecting?
Anna: Absolutely. Even complicated estate plans that need Medi-Cal planning, or anything else like that, it is a higher price, but it’s still a flat rate so you never have to worry about emailing me, or calling me, it’s all included. We’re here to make people feel comfortable. They’re not going to feel comfortable if I’m billing them by the hour.
Scott: That’s why I love you. That’s why I had you on here. Anna thank you so much for being here. I really appreciate this. This is very, very valuable.
I really look forward to publishing this, and getting it out there, and getting it in front of many people as we possibly can, ’cause this is super, super important stuff. Now, you are in Huntington Beach, California.
Scott: You can help anybody in the state of California, is that correct?
Anna: I can. I can work with somebody through email, electronically, through video, online video. I’ve met with clients up in Redondo, Manhattan Beach, San Francisco, using Zoom video, so I meet with them that way, or we just discuss it on the phone, and handle everything through email.
Scott: If somebody is outside of state because the Find My Way Home, we have, I mean, we have tens of thousands of people a month that come to the site from all over the country, if somebody’s outside of California, and they’re just not quite sure where to go, do you have people that you can refer people to?
Anna: I do. We have a network of attorneys. They’re not part of my firm, so I’m not benefiting from it, but yeah, we definitely can give referrals to attorneys in other states-
Scott: They’re people that you trust.
Anna: That I know and trust, absolutely.
Scott: Okay, that’s important. Okay, well that’s amazing. Thank you so much Anna, you have a wonderful day. We really appreciate it.
I hope anybody who watches this reaches out to you and starts their estate planning because the upside is unbelievable, the cost is completely reasonable, and the downside is absolutely horrifying.
Scott: Thank you for being here, I really appreciate it. I look forward to talking to you again.
Anna: Okay, thanks for having me.
Scott: All right. Bye-bye.
If you are in California, you can reach out to Anna on her website at www.SurfCityLawyers.com, you can call her office at 714-533-9210, or you can email her office at firstname.lastname@example.org