Don’t Let Death Get the Best of You (Copy)

“From my cold, dead hands”, is also how many people view their financial assets.  When planning for the inevitable, it is important to consider how your assets will pass when you do.  An unsophisticated estate plan or…GASP… estate planning documents your sister-in-law printed off the internet may leave your hard-earned cash in the wrong hands.

 Easy ways to mess it all up:

•          Leaving money or property to minor children.  If you pass away while your kids are under 18, assets should go into a trust for their benefit.  This will keep your irresponsible ex from getting appointed to manage the money until they turn 18.  Putting the money in a trust will also protect the kids from themselves.  What is 18-year-old Johnny going to spend $50,000 on?  How much will he put away for a rainy day?  A minor trust can include provisions that allow for needed distributions now, but keep the money safe until Johnny is old enough to know better.

•          Not funding your estate plan.  I see it all the time.  Clients come in with their fancy estate plans leaving everything to their 3 children.  Love and share alike.  After we chat a bit, I learn that they have added financially responsible Haley to all of their bank accounts.  Do they think Haley will get her one-third share?  Yes.  Is that what will happen?  No.  Haley will likely get all the money in those joint bank accounts AND one-third of everything else.  Who is the favorite child now?

•          Thinking that your family will start getting along if something happens to you.  Classic amnesia.  You forget about last Thanksgiving’s stand off and anticipate the family will sing “Kumbaya” at your bedside.  The surest way to diminish the chances of fighting and lawsuits is to leave specific instructions for your family.  This is done by executing documents that relate to your health and finances during your lifetime and your estate at death.  You can prevent them from fighting over daddy’s pistol by making sure it goes where it needs to.  Now is also the time to express your wishes about being hooked up to a ventilator, or what happens if you are permanently unconscious. 

 Now is the time to plan ahead.  Estate planning is best served proactively.  I can help you later, but it will be harder, longer and more expensive.  Don’t be fooled into thinking this is “old people stuff”.  Now is the time to establish a solid foundation.  Now is the time to put all your wishes down on paper.  Now is the time to plan for your family.