Imagine discovering thousands of dollars that belong to you, only to be told you can’t access them. This frustrating scenario is more common than you might think and highlights a widespread issue: unclaimed property. Millions of Americans face this situation and, in states like California, the process of reclaiming lost assets can be both challenging and time-consuming.
Unclaimed property includes financial assets that have been abandoned or forgotten for a period of time, typically three to five years. Common examples are forgotten bank accounts, uncashed checks, unclaimed life insurance proceeds, abandoned investments and unused gift certificates. These assets often end up unclaimed when owners pass away without informing heirs, move without updating their address or simply lose track of them. When no activity occurs over the designated time, financial institutions are legally required to transfer these assets to the state for safekeeping.
Consider your personal reality for a minute. If something happened to you tomorrow, would your family know exactly what you have and where to find it? Are you certain they wouldn’t miss something? If you’re like most people, the answer is no, you aren’t certain. What you are likely certain about is that your family would overlook some of your assets if you were to become incapacitated or die tomorrow. And, if they did, those assets could either disappear entirely or end up in your state’s department of “unclaimed property.”
According to the National Association of Unclaimed Property Administrators, approximately one in seven Americans has some form of forgotten property owed to them. As of this writing, the total amount of unclaimed property nationwide is between $50 billion and $70 billion. You read that right – billions of dollars. With a sum that high, it’s easy to see how it’s possible you, too, may have unclaimed property belonging to you.
In California, the process for recovering unclaimed property is managed by the State Controller’s Office. First, you search the state’s unclaimed property database using your name or business. It’s crucial to check all variations of your name and any states where you’ve lived. If you find property that belongs to you, you file a claim with the state, providing personal details and documentation to verify your right to the assets. The state then reviews your claim, which can take weeks or even months depending on the complexity.
Without proper estate planning, heirs may face significant challenges in locating and claiming unclaimed property from a deceased relative. In many cases, assets go unclaimed because family members are unaware they exist. An organized estate plan that includes an inventory of assets, updated beneficiary designations and clear documentation can help avoid this outcome. By taking proactive steps, you can ensure that your family won’t miss out on assets and avoid the time-consuming process of dealing with unclaimed property.
Unclaimed property is more than just a minor inconvenience – it can represent substantial sums that get lost in bureaucratic limbo. Understanding how the process works in California and taking steps to stay organized can save time and prevent financial losses.
Send your questions to ccolan@colanlegal.com and use “Alpine Mountaineer estate planning question” as the subject. We’ll answer your questions in our upcoming issues.
This article is provided by your local estate planning attorney, Corina Colan.
The Law Office of Corina I. Colan / (909) 265-3315 / www.colanlegal.com
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