How
to Bring an Estate Plan to Completion
I
have found that there are three obstacles to the closure
of an estate plan. The first is the belief that death
is not an immediate threat. The second is that most of
us do not like to make decisions. And the last is that
the estate planning process is time consuming, quirky,
and frequently lacking an infrastructure that leads to
closure.
If
you are someone who does not have a current estate plan,
and would like to complete the process, it may be helpful
to address the obstacles as you begin.
Periodically,
in our own lives or in the lives of others, we are reminded
that life is far more fragile than acknowledged by our
immediate day-to day reality. It is important to recognize
this. The ebb and flow of our own sense of mortality may
mean that we will be inconsistent in our desire to accomplish
our goals.
Sooner
or later, we decide to begin. Now we are faced with the
second obstacle: decision making. I view decision making
as two parts gathering of information and one part
willingness to make decisions mixed with the ingredients
of our own personalities.
The
Meyers-Briggs personality test recognizes 16 personality
types. Many like to see and understand the details in
contrast to those who want to see the big picture, thus
creating a challenge in communi-cation. Some of us like
to keep our options open, and others like quick closure
resulting in a fairly wide spectrum in the speed of decision
making.
For
the most part, it is probably a good thing that we have
several personalities involved in the process: the client
or clients, the attorney, maybe a trust officer and/or
a life insurance agent. Some personalities will slow the
process down and others will speed it up. A larger group
may increase the possibility that one member will drive
the process to closure.
If
you are someone who likes to understand the details before
you make a decision, the challenge is to understand information
that is complex, bordering on the arcane, explained frequently
by individuals who have not been trained as communicators.
If taxes are a consideration, changing legislation compounds
the problem. The most recent modification in the federal
estate tax rates and exemptions still leave doubt as to
what type of estate tax, if any, we will face in the future.
Although many planners now feel that the tax will stay
and the exemption will settle at 2 million, the future
is unclear.
The
process itself is inconsistent at best. First you meet
with the planner. If that is not your attorney, the next
step is to meet with her or him. Once a plan is complete,
the lawyer draws up the documents. Some lawyers, sensing
less urgency then you do and with a need to make triage
decisions in managing their own practice, may take months
before they send you your first draft.
When
you do receive the documents, they are frequently accompanied
by a letter which attempts to explain the documents. If
you are like most people, the documents don't make much
sense. Neither does the explanatory letter. The instructions
for your VCR appear positively simple in comparison. The
temptation will be to put off proceeding further.
Your
lawyer may not call you if you have not responded. If
you take months to respond and there is a need for a second
draft, your lawyer may assume a lack of urgency and take
months to make even minor changes.
Once
the documents are signed, you may be able to breathe a
sigh of relief. Or perhaps not.
If
one of your objectives is to avoid probate, most lawyers
will leave it up to you to attend to the re-titling of
your property. If you need to transfer real property to
a trust, the lawyer will tend to that responsibility.
More than likely, you are on your own regarding other
assets; your stocks, bonds, mutual funds, life insurance,
and retirement plans are all candidates for change in
title or a new beneficiary designation. If you don't tend
to the re-titling or beneficiary changes, or you do them
incorrectly, you may ruin or damage your estate plan.
Sometimes
I think it is a minor miracle that we are able to bring
an estate plan to completion. Here are some suggestions
if you are or will be struggling with this.
Suggestions:
- Implementing
an estate plan is like building a house. So select
a project manager for your plan. Ideally, this is
someone who has both the personality and inclination
to keep everyone on schedule. It could be the attorney,
yourself, spouse, adult child, life insurance agent,
or trust officer.
- Get
a time schedule set in advance. It's the project manager's
responsibility to make sure the contractors, subcontractors,
and you, stay on schedule.
- Get
clarification from your lawyer as to who will be responsible
for the details of changing titles or beneficiary
designations if necessary. Incorporate this responsibility
into the project.
- Review
the project on a regular basis. Even if you are way
off schedule, your chances of completion will be significantly
better if you know where you are in the process.
Recognize
that your plan will never be perfect. If you can't seem
to agree as to who will be the guardian of the children,
consider going ahead without nominating one. I think we
can all agree that a Will without a guardian is better
than no Will at all, yet some of us will delay simply
because we fear that once an estate plan is implemented
we will not tend to this important task. Consequently,
it is important that you keep a list of those items in
your plan that you felt were less than ideal, and review
this list at least yearly. Unlike building a house where
you may encounter daily reminders of your decisions, an
estate plan tends to fade quickly from sight.
I
hope these suggestions are helpful. If you have some of
your own please let us know.
