The Future of Probate Filings in California: Key Projections and Trends

California Probate Filings: Future Projections and Trends

California is on track to see a significant increase in probate filings over the next decade. This trend, influenced by demographic shifts, economic factors, and evolving family dynamics, underscores the importance of understanding the implications of the California probate process and the necessity of effective estate planning.

Why Will Probate Filings Increase?

Blended families can include stepparents, stepsiblings, and half-siblings, which often leads to complex family dynamics. There can also be significant disparity in ages when there are new additions to the family following a remarriage—half-siblings can be a full generation apart. When planning an estate, it’s essential to recognize these relationships and their implications. For example, a stepparent may feel a strong bond with their stepchildren, but legal rights can state the opposite. Understanding these dynamics is the first step in creating an equitable estate plan.

1.  Aging Population: California’s senior population (ages 65 and older) is projected to grow by 60% by 2034. This surge will likely lead to a rise in estates requiring probate administration in California, particularly for those without comprehensive estate plans.
2. Wealth Transfer: The upcoming wealth transfer, estimated at $68 trillion over the next 25 years from Baby Boomers to their heirs, will primarily impact California, where high property values and complex estates necessitate probate for many inheritances.
3. Generation X: As Gen X ages into retirement and inherits wealth from Boomers, they will face the same estate planning needs, but with significantly larger estates. Their asset ownership, particularly real estate, will contribute to an increase in probate cases.  The primary expenses of a probate proceeding, attorney fees and personal representative fees are based on the gross value of the probate estate.  Higher value estates mean higher costs.
4. Low Rates of Estate Planning: With over half of U.S. adults lacking a will or trust, many estates, especially those with real estate or substantial assets, will necessitate navigating the California probate process.

Projected Probate Filings

Currently, California sees about 38,000 probate filings annually, with projections indicating a 3-5% annual growth. This means that in just five years, potential filings could exceed 50,000, highlighting the increasing importance of understanding probate procedures in California. Regions like Los Angeles, Orange, and San Diego counties will experience even sharper increases due to larger senior populations.

Some regions, Ventura County specifically, have much more limited resources, with only one probate court to serve the entire Ventura County probate process.

Additional Factors Influencing Probate Filings

1. Changes in Probate Laws and Court Capacity: Legislative changes could impact the probate process. While increased thresholds for exemptions could reduce filings, the likely increased thresholds would not have a significant impact on Los Angeles, Orange Ventura and San Diego counties, dues to the above median values for homes in these areas.  Other impacts, equally likely are court budget cuts could lead to further backlogs.
2. Increasing Family Complexity: Rising rates of divorce and blended families can create more contested wills and disputes, leading to an above average in probate cases filings.
3. Real Estate Ownership Trends: High property values will trigger probate for many estates, especially in areas where values exceed the probate exemption threshold (currently $184,500).  Even a doubling of the current threshold will not have any significant affect on southern California probate filings.
4. Economic Volatility and Debt: Increasing personal debt levels may require probate to settle creditors, complicating the process if estates lack sufficient liquid assets.  Credit card companies particularly favor probate proceedings as swift and prioritized means of recovery of debt.
5. Impact of Digital Assets and Cryptocurrencies: The rise of digital assets introduces complexities in probate, as families may struggle to manage these assets without clear provisions in estate plans.  Currently Courts struggle with valuing and identifying digital assets, many of which end up being lost to families, while adding to the costs of probate proceedings and valuations.
6. COVID-19 and Long-Term Health Concerns: The pandemic highlighted the importance of estate planning while increasing unexpected deaths, which may elevate probate filings, as the long-term affects are still being played out, including significant judicial retirements and a shortfall in new hirings.
7. Technological Changes in Probate Administration: Digitization efforts in probate courts aim to streamline processes.  Following the pandemic, Probate Courts switched to allow and encourage virtual appearances.  However, disparities in implementation across counties has lead to processing delays; mandatory forms in one county, are not necessarily the same one county over.

Navigate Probate Confidently with DRS Law

The future landscape of probate filings in California will be shaped by demographic changes, legal developments, and evolving societal norms. Engaging in thorough estate planning with experienced California estate planning attorneys is essential to mitigate the challenges of probate and ease the burden on loved ones. By staying informed about these trends, families, attorneys, and professionals can navigate the probate process with greater efficiency and preparedness, thus saving individual family’s tens of thousands of dollars.

If you are ready to take proactive steps, the probate experts and estate planning team at the Law Offices of David R. Schneider, APC are here to help. Contact us today to protect your legacy and secure peace of mind for your family.