In 2008, Congress passed House Resolution 1499 which recognized the need for the public to understand the importance and benefits of estate planning and designated the third week of October as National Estate Planning Awareness Week. Notably, this Resolution passed without objection on the bipartisan sponsorship of 50 representatives.
Nevertheless, according to a 2021 survey conducted by Caring.com, only 33 percent of adults in the United States have any estate planning documents such as a will or trust, despite the fact that approximately two-thirds of the respondents viewed such documents as somewhat or very important. Many respondents attributed their lack of estate planning to procrastination, but many others indicated a mistaken belief that estate planning is not necessary because they do not have many assets. What’s worse is that only 18% of adults over age 55 have a complete set of estate planning documents. Are you ready?
Why should you have an estate plan?
An estate plan can provide significant peace of mind by ensuring that your money and property are protected, plans are in place in the event you become incapacitated, and your accounts and property pass down the way you wish.
Key Elements of an Estate Plan
- Last Will and Testament or a Trust
If you do not have these important documents, state law will determine who will inherit your property—and it may not happen in the way you would have chosen. Additionally, someone appointed by the court, instead of a trusted person of your choosing, will be in charge of caring for any children or pets and overseeing your affairs. Clearly listing your wishes in a will or trust will also prevent unnecessary confusion, anxiety, and expense for your loved ones when you are gone.
- Powers of Attorney- Financial and Health
Financial Power of Attorney designates an individual to make financial and property decisions (e.g., opening a bank account, signing a deed, getting your mail, etc.) should you become unable to handle your own affairs. A Health Care Power of Attorney designates a person you trust to make medical decisions for you if you are incapacitated or in the unexpected event of death.
- Advanced Directive
Ensure that you have an Advance Directive, also called a Living Will, which memorializes your wishes concerning your end-of-life care, such as whether you want to receive life support if you are in a vegetative state or have a terminal condition.
Do you have insurance? If you become incapacitated (unable to manage your own affairs) or die, it is important for your family or loved ones to have information about your insurance (such as life, health, disability, long-term care, etc.) so they can file any necessary claims. Having the right amount of coverage is also important in case you become ill or die, leaving behind loved ones who rely on your financial support.
- Important Personal Information
Compile a list of all of your accounts and other important information that may be needed to manage your accounts and property while you are incapacitated or to settle your affairs after you are gone. Keep this information in a safe place and share the location only with trusted family members, other loved ones, or your lawyer. This list should include at least the following information:
- bank and investment accounts
- titles to vehicles and homes
- credit card accounts or loans
- Social Security card, passport, and birth certificate
- List of Professionals
A list of legal, financial, and medical professionals who have performed services for you is also important. The list should include their contact information (including the company name, phone number, and email address) your loved ones can easily reach them in the event you or they need the professional’s help. You should also have HIPAA authorizations in place with medical professionals to ensure that your loved ones can obtain needed information.
“…in this world, nothing is certain but death and taxes,” Benjamin Franklin.
How can you help your loved ones to create an Estate Plan?
Estate Planning Awareness Week is a great opportunity, not only to take steps to make sure your own estate plan is in place, but also to talk to your loved ones, especially elderly parents, about creating an estate plan. Estate planning is often a challenging topic to discuss because it brings the unpleasant topics of aging and death to the forefront of our minds. Here are a few tips to help you start the conversation.
- Build a Foundation. Estate planning isn’t only about planning for things we’d rather not think about. Getting your affairs in order will give you peace of mind. It will also give you the opportunity to consider the legacy you want to leave, even if you aren’t planning for that legacy to happen for many years. If you also put your goals into your plan, you can start working towards achieving those goals. How early is too early?
Well, think of it this way – what if your parents started planning for you when you were still a child? What would the value of your IRA be if deposits had been made for the past 20+ years? What would the cash value of a life insurance policy be if it was placed when you were 10 years old? With the right plan, what could you build?
- Be sensitive to your loved ones’ feelings. Put yourself in their shoes and keep in mind that few people wish to dwell on the subject of their own death. One way to begin the conversation is to talk first about the need to plan for an illness and to provide instructions if they become too ill to communicate with doctors or handle financial matters for themselves. The conversation can then progress naturally to the importance of having an estate plan that will transfer their money and property in the way that they wish, provide for the care of any dependents or pets, and minimize any taxes, court costs, and legal fees.Stories tell the best, so feel free to share about a celebrity estate planning fails. Communicate that you are not trying to control their decisions but only want to ensure that their own wishes regarding their medical care and property are known—and that all of their instructions are in writing to guarantee that they are carried out.
- Involve others in the conversation. If you are planning to speak to your parents about the need for an estate plan, try to include any siblings in the discussion to avoid giving the impression that you are attempting to influence or control your parents’ choices. You and your siblings should emphasize to your parents that none of you is asking about what you will inherit, but rather just want to make sure that their wishes are carried out the way they would want when they are not here one day or might be unable to communicate.
- Consult an estate planning attorney. An experienced estate planning attorney can help you and your loved ones create an estate plan tailored to meet each of your unique needs and carry out your wishes, or they can assist with updating an existing estate plan. We can provide each person with guidance and information about the options available to them. Further, we can help each of you put a plan in place that will prevent unnecessary stress, legal expenses, and taxes, as well as uneven inheritances, disputes among loved ones, and delays in passing life savings on to them. In addition, the guidance we offer will give you and your loved ones the peace of mind that comes with knowing that plans are in place for your care if any of you become ill and that your wishes will be honored when you pass away. Call us today to set up a meeting at 954-237-4011 or email us at firstname.lastname@example.org.
 Daniel Cobb, 2021 Wills and Estate Planning Study, Caring.com, https://www.caring.com/caregivers/estate-planning/wills-survey/ (last visited August 17, 2021).
 Neither of these ideas should be considered investment advice. These decisions should be made on an informed basis with consultation from licensed professionals.