When someone passes away, everything they own becomes part of their estate. An estate isn’t just for the wealthy—it’s a legal term that includes all property, financial assets, and outstanding debts left behind. Understanding what an estate is, how it’s managed, and how it passes to loved ones is essential for families planning ahead.
What Does an Estate Include?
An estate includes everything a person owns or owes at the time of death. This means both assets and liabilities.
Common estate assets:
- Real estate properties such as homes, land, or vacation residences
- Bank accounts, investments, and retirement funds
- Life insurance policies payable to the estate
- Vehicles and titled property
- Jewelry, art, or other valuables
- Business interests or intellectual property
Common estate liabilities:
- Mortgages and home equity loans
- Credit card balances
- Personal and business debts
- Unpaid taxes or medical bills
These items together form the total estate value, which is used to determine how property will be distributed.
What Happens to an Estate After Death?
When a person dies, their estate must be settled. This is done through a court-supervised process known as probate. Probate ensures that debts are paid and remaining assets go to the correct beneficiaries.
If there is a valid will, the court confirms it and authorizes the executor to manage the estate. If there is no will, the estate is handled according to state intestacy laws, and the court appoints an administrator to oversee the process.
How Probate Affects an Estate
Probate can vary in complexity depending on factors like estate size, asset type, and whether there are disputes among heirs. In many cases, the process involves multiple steps that can take several months.
Typical probate costs include:
- Court filing fees
- Attorney and executor compensation
- Appraisal and accounting expenses
- Taxes and debt payments
These costs are paid out of the estate before any assets are distributed to heirs.
How Estate Planning Simplifies the Process
Estate planning allows you to control what happens to your assets and protect your loved ones from unnecessary legal complications. It involves creating documents that define your wishes and name people to carry them out.
Common estate planning tools include:
- Last Will and Testament: Outlines who inherits your property
- Living Trust: Allows assets to transfer without probate
- Power of Attorney: Appoints someone to make decisions if you’re incapacitated
- Healthcare Directive: Specifies medical care preferences
Having these documents in place ensures your wishes are honored and your estate is handled efficiently.
What Happens Without an Estate Plan?
If a person dies without an estate plan, the state determines how assets are distributed. This can lead to delays, confusion, and family disputes. The process typically involves:
- The court appointing an administrator
- The administrator collecting and valuing assets
- Paying outstanding debts and taxes
- Distributing remaining property according to state law
Without a plan, loved ones may face additional stress, legal fees, and tax burdens.
Why Estates Matter for Every Family
Every individual has an estate, regardless of income or wealth. Homes, savings, vehicles, and even sentimental belongings are part of it. Estate planning isn’t just about money—it’s about ensuring your property goes to the people you care about and avoiding unnecessary court involvement.
Proper planning helps families:
- Avoid lengthy probate delays
- Reduce administrative costs
- Minimize estate taxes
- Maintain privacy and peace of mind
When to Speak with an Estate Planning Attorney
Estate laws differ by state, and mistakes in documentation can invalidate your wishes. Consulting an attorney ensures your estate plan complies with current laws and provides full protection for your assets.
If you want to create or update your estate plan, contact an experienced estate planning attorney in Los Angeles, CA. They can help you organize your assets, draft the right documents, and make sure your estate passes to your loved ones exactly as you intend.
Michael Avanesian, the founder and driving force behind Avian Law Group, is a passionate and dedicated attorney with a strong background in personal injury law. As a partner at JT Legal Group, Michael led the growth of the personal injury practice from a single employee to a team of over ninety professionals, securing over $2 billion in settlements for clients in just three years.
