Take your medicine...it's Good For You

Americans just do not like to discuss estate planning. Supposedly 7 out of 10 of us have no plan. Of the 3 who do, what are the chances that the plan is up to date? 

A friend of mine, Michael Stuart, just sent me this article in the NY Times, Estate Planning as Family Conversation, talking about talking. I wanted to share it with you as it paints the picture of what happens with no plan, and even how to open a conversation about one. 

When I think about the plans that I have helped clients create, many stories come to mind. One recurring theme is a senior couple who own some investments and real property, with one of their adult children serving full-time as a caretaker. Other kids are not too involved in things… and the caretaker daughter pretty much has her hands full with children of her own and helping out the folks. In this situation, the adult daughter has a full time job or two already… and no outside means of support. 

Many parents want to treat children "equally." But what do you do when there is only so much to go around, and the cost to one kid (the helper) is simply going to be too high for that to even remotely be fair? Parents must first plan for their care, then consider being "fair" rather than "equal" to those who follow. 

It's often the right thing to do… but without some conversation, and openness, it will likely have a huge cost in terms of relationships down the line. And ignoring this dynamic is unlikely to provide a better result. So start talking, it is a big first step to helping you with your estate planning today and well into the future.

 

Why Legalzoom.com is better than an attorney

One question that many people I meet ask is "how much will the documents cost". I explain that I don't sell documents -- I provide professional advice and that with over thirty years of experience I know what questions to ask to fully explore their needs, wants and desires. I tell them "if all you want are documents, you can find them at any number of "legal sites" on the internet." (It's funny -- when I started out I had to point them to the law library's form books). However, when I or one of my estate planning colleagues are done, they have a comprehensive plan that provides them the protection and benefits they thought they needed plus answers to the questions they didn't know they had. I provide some peace of mind. The documents simply implement that plan.

My good friend, Dennis Brislawn, wrote an interesting blog post about the use of LegalZoom.com compared with the services of an attorney. You might find his perspective interesting.

I recently had an opportunity to check out some LegalZoom documents. One of my friends used the LegalZoom service to prepare some Wills for his kids. They were simple trust planning documents. Each spouse left the estate to the other, but if both were deceased, they had a Common Trust for all kids until they turned 21, then money would split into shares that each child would receive in equal installments at ages 24, 27, and 30. These LegalZoom documents even had powers of attorney and all the trimmings.
The documents looked pretty "legal.” My friend did the plan himself, in an hour or two on the weekend, and only spent a few hundred dollars. He did this lieu of going to an attorney for budget reasons and scheduling difficulty with his activities. At least he did something, which is far better than not covering this important issue – so kudos to my friend.
When he sought my opinion, my comments were that I thought the documents were good from a simplistic technical perspective. I actually kind of liked them as they were well-written and clean. How did that work compare to what I or one of my estate planning attorney colleagues would do? They were simple, not elegant. But the most important missing component is they did not demonstrate insight, personalization, or the awareness of core values important to my friends. The document was clear for the kids after age 21, but there was no meaningful guidance into how a trust would be used by the guardians of children to raise them until age 21. Guidelines create the comfort that their kids will become the adults their parents would be proud of. What about asset protection for adult children to protect their inheritance against divorce or bankruptcy? I think you get my point.
Result? I was retained to do a comprehensive plan to address all the things that were not part of the simple LegalZoom plan. We also looked over their investments, retirement planning, insurance coverage, and the separate inheritances each was to get from their own grandparents and parents. I reached out to my friend's advisers and got their help in relooking at all these things to make sure that they were properly handled too.
LegalZoom provides documents. But I’m reminded by this experience that law is far more than the preparation of documents. It is about listening, discerning, and identifying core values. It is about understanding what can keep your clients awake at night. It is about pulling together resources to resolve those concerns and to put a plan in place. But, even more important, it is about working to keep that plan tuned up so that as things change, it changes. Documents are simple. Wisdom is harder to come by.


My experience with web based documents is similar to what Dennis describes. Yes, the forms that I use are an important part of the complete plan, but are really just a secondary part of my service. Preparing documents using LegalZoom or other web based programs is infinitely better than doing nothing at all, but an estate planning attorney provides well informed advice and delivers far more than just a set of forms.

Please tell me what you think in the comments.

The Children get Stuck with the work

My clients often find themselves with "Boomer" burdens. They have worked hard, raised their family, seen their children off to college and on to new jobs and a new life. They were just getting comfortable with their empty nest. They had plans to enjoy some travel and find some hard earned leisure. 


They knew their parents were getting older, but they never really thought about what that really means. Mom and Dad were always there for them and were living independently at home. Suddenly, they find themselves having to care for an aging parent who just can't manage anymore. I know, because I had that wake-up call when my father admitted that he just couldn't deal with his finances any longer. It was hard on both of us.


My good friend and colleague, Dennis Brislawn, recently shared this story about one of his clients. It was something I see far too often.

"I had the incredible opportunity to attend my aunt’s birthday party and take this photo. It was indeed a happy occasion for all – especially when she invited everyone back for her 100th birthday party in 2011.

While enjoying the celebration and festivities, I was reminded of the sobering thought of all the financial and legal plans that her only daughter has been saddled with as her mother aged. As the children of aging parents, we never know if we will be buying a celebration balloon like this for their 99th birthday – and it is usually the least of our challenges as the years creep forward for a centenarian parent.

While attending her birthday party, my mind drifted to the many issues her only child has had to deal with for nearly 25 years. Getting to this 99th birthday has been a lot more work and worry for the daughter than for the birthday mother. The daughter has had to manage finances, coordinate moves, work with doctors, screen assisted living homes, and of course, work with the attorneys.

I was personally relieved, knowing I could attend the celebration, wish my aunt a “Happy Birthday”, and return home. My cousin, on the other hand, would be at the party to the very end. She would be cleaning up the leftover cake, policing the party room at the assisted living facility, etc. And she still has to deal with all the fiduciary responsibilities that continue long after the party has ended."
 
People deal with this reality on a daily basis – most of which are neither easy nor pleasant. In the middle of all of the burdens dealing with their parents they swear that their children will not be unprepared when they need some additional help. Working with caring attorneys and other professionals can often reduce stress and relieve some of their concerns about their future. Dealing with these professionals should never increase the burdens. I hope that over the years I have been able to alleviate some of their worries and made life just a little bit easier for them, their parents and their children. 


After all, they have to start planning for the next big birthday party for their mom!