Estate Planning After 65 in California: It's Not Too Late

Protect your assets, avoid probate, plan for incapacity

By Rozsa Gyene, Estate Planning Attorney | State Bar #208356

Living Trust for Seniors California: Key Benefits

1. Incapacity Protection (Most Important for Seniors)

Incapacity risk increases with age.

With living trust: Your successor trustee immediately manages your financial affairs. No court. No delays.

Without living trust: Family must go to court for conservatorship (costly, and it takes months).

2. Avoid Probate ($26,000 in Statutory Fees on a $500,000 Estate)

California law sets statutory attorney and executor fees as a percentage of the gross estate (Prob. Code §10800, §10810); court costs, appraisal and publication fees are extra. For a typical senior homeowner:

A funded living trust avoids probate for the assets it holds. Your successor trustee can distribute them without going to probate court, with no probate fees.

3. Proposition 13 Property Tax Protection

Critical for California senior homeowners:

• You bought home years ago at low price
• Prop 13 keeps property taxes low (increases capped at 2%/year)
• Your home may be worth 10x what you paid
• When you die, your family home can pass to a child with your Prop 13 tax base if the child makes it their principal residence within one year and files for the homeowners' exemption within one year

Under Proposition 19, $1 million is not a cap on the home's value. If the home's market value is less than your taxable value plus $1,000,000, the child keeps your taxable value. If it is more, the child's new taxable value is your taxable value plus the amount by which market value exceeds your taxable value plus $1,000,000. The $1,000,000 figure is adjusted for inflation every two years. If no child lives in the home, it is reassessed to market value. A child who qualifies can save $10,000-$20,000/year in property tax.

4. Medi-Cal Planning (Long-Term Care)

Important for seniors 75+:

• A revocable living trust does not change your Medi-Cal eligibility: its assets count just like assets in your own name
• Trust assets count for Medi-Cal (but so do non-trust assets)
• Medi-Cal looks back 30 months for gifts before nursing-home care, but transfers made before January 1, 2026 are not counted. Irrevocable trust planning is separate from our flat-fee living trust; ask an elder law attorney

Estate Planning Seniors California: What to Include

Complete Senior Estate Plan Includes:

1. Revocable living trust (avoids probate, manages assets if incapacitated)
2. Pour-over will (backup for forgotten assets)
3. Durable power of attorney (financial decisions if incapacitated)
4. Advance healthcare directive (medical decisions, end-of-life wishes)
5. HIPAA authorization (family can access medical records)
6. POLST form (if seriously ill - specific medical orders)

Living Trust California provides the trust, pour-over will, power of attorney, healthcare directive and HIPAA authorization for $400 ($500 joint). A POLST is completed with your doctor.

Retirement Living Trust California: Special Considerations

Managing Retirement Accounts

DO NOT transfer retirement accounts to living trust:

• IRA, 401(k), 403(b) should NOT go in trust (triggers taxes)
• Instead: Name beneficiaries directly on retirement accounts
• Can name trust as beneficiary if you want control over distributions

Social Security and Pensions

• Social Security cannot be transferred to trust (ends when you die)
• Pensions: Check with plan administrator (some allow trust as beneficiary)

Medicare vs Medi-Cal

Medicare (age 65+): Living trust has NO effect on Medicare eligibility. Medicare doesn't consider assets.

Medi-Cal (low-income seniors): Trust assets count toward the asset limit, which from January 1, 2026 is $130,000 for one person plus $65,000 for each additional household member. A lower limit ($21,000 for one person, $31,000 for two) is scheduled to start no sooner than July 1, 2027.

Common Questions: Senior Living Trust California

Am I too old to get a living trust?

No. As long as you're mentally competent, you can create a living trust at any age:

• Age 65-75: Standard planning
• Age 75-85: Add incapacity protections
• Age 85+: Even more important (higher incapacity risk)

What if I already have dementia?

Depends on severity:

• Early stages: May still have legal capacity (a capacity assessment may be needed)
• Advanced stages: Likely too late (family needs conservatorship)
• Don't wait. Create trust while you're healthy.

Should I put my home in trust if I'm in assisted living?

Yes. Even if you're in assisted living:

• Home can be sold to pay for care (easier if in trust)
• Avoids probate when you die
• Can pass to a child who makes it their home and keeps your Prop 13 tax base (Prop 19 rules)

What about my reverse mortgage?

Transfer home to trust BEFORE getting reverse mortgage. Once home is in trust, you can get reverse mortgage. Trust doesn't affect reverse mortgage.

Cost: Senior Living Trust California

Key Takeaways: Senior Living Trust California

• Seniors 65+ NEED living trust: incapacity risk increases with age
• Avoids conservatorship: spare your family a court conservatorship if you become unable to manage affairs
• Avoids probate: $26,000 in statutory fees on a $500,000 estate
• Prop 13 tax base for children: a child who makes the home their principal residence can keep your low property tax base
• Medi-Cal: a revocable trust neither helps nor hurts eligibility
• Complete estate plan essential: trust + POAs + healthcare directive
• Don't wait: create trust while mentally competent
• Cost: $400 ($500 joint) for attorney-prepared and reviewed trust vs often several thousand dollars with a traditional attorney

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About: Rozsa Gyene, California Estate Planning Attorney, State Bar #208356, 25+ years helping California seniors protect assets and families.

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