What is a Personal Property Memorandum?
Under the California Probate Code §6132, A Personal Property Memorandum (PPM) is a document that contains a list of items of your personal tangible property (no items related to a business or non tangible items such as stocks or money) and who are the various beneficiaries to receive such items.
Why Can Having a Personal Property Memorandum be so beneficial for you?
Having a PPM is extremely beneficial since it is a document that can be drafted, edited, or revoked by the creator of the trust or will themselves without requiring the assistance of an attorney.
For example, if you suddenly decide that you want to leave your watch to your granddaughter or wedding album to your great grandson, you don’t have to call your attorney to set up a meeting (not to mention pay any amendment fees) to make an amendment to your trust or will. All that is required that you draft or amend your Personal Property Memorandum.
What Are the Requirements for a Valid Personal Property Memorandum?
The main requirements for a valid PPM include:
- The possible existence of a PPM needs to be referenced in your Trust/Will - this is an important point to check with the attorney that is drafting your estate plan. Most serious estate planning attorneys will make sure to mention the possible existence of an executed PPM in the distribution section of your trust and will attach empty PPM pages, ready for you to fill out, included in your estate plan.
- The PPM needs to be dated and signed by the settlor or in their handwriting.
- The writing describes the items and the individuals who are to receive them with reasonable certainty (example: don't write “my gold earrings” to my granddaughter if you have more than one set of gold earrings and make sure to specify the name of the individual(s) to receive them. Even better add a description at the end of the name explaining how they are related to you (example: Amanda Brown, niece, or Daniel Cole, grandson).
- No single item listed on the Personal Property Memorandum can be worth more than $5,000 so make sure not to list any item that is, or may in the future, be so valued.
- The total value of assets listed in the PPM cannot exceed the sum of $25,000.
As mentioned before, the big advantage of a PPM is that it allows you to control the distribution of all your assets that, while lacking in significant monetary value, may have a lot of sentimental value. After a PPM is executed (without any lawyer involved). It can later be revoked and a new document executed instead.
There are more technical aspects to executing a PPM. When meeting with your estate planning lawyer to discuss or execute your estate plan, we advise you to request that they show you how to execute a personal property memorandum.
Conclusion:
Personal Property Memorandums are very useful for those trust creators who are more particular as to how smaller possessions will be distributed, collectors, or people who hold tangible assets that hold sentimental value to them and their family members. The important thing about Personal Property Memorandums is to be clear as to who the beneficiaries are and to what assets. This is especially true if the PPM was revised multiple times.