As estate planning and trust administration attorneys, we run into quite a few issues regularly with clients where the issue can be resolved by looking at specific documents. Often, the clients cannot find those documents, either because they are very old or because they do not appear to be very important. Here we will go through a list, although not exhaustive, of some essential documents you should be sure to retain in your records.
Medi-Cal Determination Letter
Medi-Cal, California’s implementation of Medicaid, is a needs-based health care benefit available to low-income and/or low-asset individuals in California. A Medi-Cal determination letter, also known as a Medi-Cal Notice of Action, is a written notice that gives Medi-Cal applicants and recipients an explanation of their eligibility for Medi-Cal coverage or benefits. The letter will come from your county’s health services department. It will include the decision, type of Medi-Cal the beneficiary is receiving, the effective date of coverage, and any changes made since the previous year. They are issued when you first apply for Medi-Cal and then every year after that.
There are many types of Medi-Cal. Some are income-based, some are asset-based, and some are both. Knowing what kind of Medi-Cal you receive is very important in terms of inheriting assets or receiving gifts or settlements. We strongly recommend that if you receive any type of Medi-Cal, you retain your Medi-Cal determination letter front and center in your files.
Social Security Correspondence
The Social Security Administration (SSA) administers a few programs that we see routinely among our clients. They include social security retirement benefits, social security disability insurance (SSDI), and supplemental security income (SSI). Sometimes we also see disabled adult child benefits (DAC). If you are receiving any of these benefits, you received an eligibility letter when you first started receiving benefits, and you receive a letter every year with any cost-of-living increases or changes to your benefits. Similar to Medi-Cal, SSI is a needs and asset-based benefit. If you are unsure what social security benefit you are receiving, an unexpected windfall could put your benefits at risk. We strongly recommend keeping all correspondence from the SSA in your files, especially any eligibility letters stating what program you are receiving. Additionally, correspondence from the SSA can often be used as proof of your social security number at other government offices should you misplace your social security card.
Military Discharge Papers and Separation Documents
If you or your deceased spouse were in the military, generally, a report of separation is issued when military services end, and you or your spouse received a form called the DD Form 214, Certificate of Release or Discharge from Active Duty (DD214). Depending on the time of the service, the form may have been a different number, but most commonly, the DD214, as it is more frequently known, is the document you will need. This form includes a summary of the service member’s entire military service, including, but not limited to: date and place of entry into duty, date and place of release from active duty, last duty assignment and rank, job specialty, military training and education, any decorations, medals, badges or awards, total creditable service and foreign service, and separation information (date, the character of service, the reason for separation, etc.).
The DD214 will be required if the servicemember or their spouse wants to apply for the aid and attendance pension from the Veteran’s Administration (VA) or if they wish to be buried or interred in a national cemetery or receive medical benefits through a VA hospital. Replacing this form can take quite a while if you have to request it from the government, so we suggest keeping it in a safe place.
Vital Records: Birth Certificates, Death Certificates, Marriage Certificates
Keeping at least one certified copy of birth, death, and marriage certificates can be extremely useful and save you a trip to the vital records office of the county that issued the certificate. We recommend keeping a death certificate for any close relatives in case small items pop up after a trust administration or probate that require proof of someone’s death: this could be a life insurance policy, etc. Even though we are in a digital age, having a physical copy of a certified vital record is essential.
In addition to vital records, if you have any divorce decrees, adoption or guardianship orders, letters, or other paperwork, you should also maintain records of those. You never know when you might have to provide paperwork to back up information. You don’t want to have to go to the county records office to find that information.
Financial Contracts: Life Insurance Policies and Annuity Contracts
The most frequent financial documents we would like to see from our clients, which they often cannot find, are the actual life insurance policy paperwork and annuity contracts. Often, these documents are never found because they are so old or are buried under other paperwork because it was the initial paperwork for the asset. Additionally, these types of assets do not always generate monthly statements, so it’s possible that individuals have no ownership paperwork of these assets and are just aware of them or have one or two pieces of correspondence from the financial institution.
Typically, if a client needs to change the beneficiary on their policies, they will need pertinent information about the policy. If a client dies, how will their trustee or next of kin know where to find the policy or know who the beneficiary is? Knowing who your current beneficiaries are and what the company’s policy is if one of those beneficiaries predeceases you is important. What if a grandchild inadvertently inherits and they are special needs and is now at risk of losing public benefits?
Maintaining these records is also crucial because you need to know what type of contract or policy you have for the purposes of qualifying for Medi-Cal or any other public benefits. Annuities and life insurance policies are not all the same in the realm of public benefits, and some may disqualify you very quickly. Also, sometimes in order to redeem a life insurance policy, if it’s old, the company may require the beneficiaries to submit the original policy with a death certificate as a part of their redemption process. If you can’t find the original policies and contracts, reach out to the financial institution to have them send you a copy today!
If you are just looking into creating an estate plan now or if you already have an estate plan, make sure you keep it up to date with the correct data that your family may need, including all of the pertinent documents discussed here. If you are missing anything, now is the time to make those phone calls to obtain replacement documents so you can make things easier on your loved ones.