To begin planning your estate is to think through the intricacies of your life, to think about your values and your family. But there is nitty-gritty you might be overlooking: the financial, the legal, and the shared understandings. Make time to consider what you might be overlooking before planning in earnest.
Easily overlooked details can be discovered by following some simple guidelines: Estate Planning documents and beneficiary designations should be kept up to date; both you and your spouse should know the location of all financial accounts and have the information to access them; and both you and your spouse should participate in regular updates from your financial advisor. These guidelines are only a start, but a solid one, especially for married couples. Following them is a natural lead-in to conversations you may not have realized you needed to have.
You should discuss who will be acting on your behalf as your agents, those people who represent your interests through a power of attorney, will or trust. Picking the wrong people can frustrate your plans, whether due to lack of capability, dedication or trustworthiness. You need to ensure that only the right people hold your durable power of attorney or serve as executor or trustee. Attempting to maintain equal footing and prevent hurt feelings among heirs can often lead to chaos. Some people are better suited for certain duties and it is not a comment on your love for or value of your heirs to make wise choices. Explaining the reasoning behind your choices while you are alive and allowing heirs to work through their emotional reactions now--without the stress of imminent decision making--will ensure a smooth execution of your wishes and lessen the possibility of poor decision making by your heirs.
And of course, you will also discuss your inheritance – choosing who will benefit from your estate. Money can be easily divided among your beneficiaries in any proportions that you believe are appropriate. In contrast, it can be more difficult to plan for the disposition of particular objects. Oftentimes, physical items are difficult to split up. For example, you can’t simply tear the painting in half, divide a book, or even realistically split a set of china.
How you split up priceless family artifacts and other physical goods can start a fight, or, if thoughtfully done ahead of time, end fights before they happen. This is a topic worth discussing with your heirs and beneficiaries. That way everyone can express what things they may want and why. Family heirlooms represent an emotional connection that may even be more important to family members than financial assets. The estate you leave is not just about money it is also about the memories and shared values that hold families together.
Having the right conversations is only the beginning. A plan for your estate that’s not committed to paper is no plan at all. Determining your priorities and goals for your estate plan should then dictate the structure of your plan and the creation of the documents required to make it a reality. It takes a great deal of training to properly structure an estate plan. That’s why you consult competent and experienced legal counsel.
The critical first step, however, is starting the right conversations with your spouse and family members. Then continue the conversation with competent counsel who can guide you, your spouse and all of your loved ones in building the right plan to achieve your unique important goals.
James M. Miskell received his law degree from the University of Georgia in 1993. His Asset Protection, Estate Planning, and Elder Law practice has offices located in Lawrenceville and Johns Creek. He offers educational workshops and free consultations to assist clients as well as fellow professionals in creating individualized solutions. Visit his website: www.LetsTalkEstatePlanning.com. For more information, see his ad in this issue.