Documents ... or RESULTS?
Short answer: It’s NOT about Documents, it’s about Results!
Most people start their estate planning with some limited knowledge of the subject. They approach their lawyer with a statement like this:
- "I need a living trust" or
- "I only need a simple will" or
- "I need a life estate deed."
- Maybe it’s "I need a general durable power of attorney" or
- "I need a health care power of attorney and a living will."
Whatever "it" is, then the question that follows is "How much will you charge me for it?" An interesting thing then occurs at most law firms: the lawyer or secretary quotes the person a word-processing fee -- for that is all the lawyer is going to do to fill the order -- and the client gets a standard, one-size-fits-all document named whatever they requested.
Upon what experience does the average person base their belief that they "need" whatever "it" is?
Most folks have experienced a death in the family. Perhaps mom, dad, grandma, or grandpa died. Maybe their aunt died and left them as Executor. Few people have been through more than one or two of these experiences first hand and carried the responsibility of winding up an estate.
Then add to that experience the "education" they got talking with the barber, chatting at the donut shop, visiting with their minister, or talking with their insurance agent. Slip in what their brother-in-law said about when his cousin died, and you can pretty much sum up the average person’s "knowledge" about estate planning.
Quiz time. Have you ever even asked your attorney specifically, "How much will the estate plan you are preparing cost my family when I die?" Without asking, how do you know? We find that only about 1 in 20 people have actually asked this question. That is by far the most expensive part of the typical estate plan, but almost no one ever thinks to ask about this basic, fundamental estate planning issue.
Based upon their "vast amount" of experience and research, the average person "knows" that all they need is one of those whatever-you-call-it—trust, will, deed, etc., you fill in the blank.
Sounds like they’re going to get an estate plan that will really work for them, right?
Imagine going in to the doctor and saying, "Doc, I need some penicillin; how much will you charge me for it? Please do not examine me. Do not discuss it with me. I already know my problem and the cure. I just want a prescription for penicillin." Sound ridiculous? How different is it?
It’s just like going to the lawyer and saying, "I need a [fill in the blank with the document you have in mind], how much will you charge me for it?"
Unfortunately, getting an estate plan this way gives the client an unjustified peace of mind, and in our experience, most of those clients will go to their grave with a plan that will fall far short of their expectations. Unless they get to see it from the next life, they will never know that their plan didn’t work as intended.
How else might one approach planning?
Ask yourself this question: "If I am able to look down on my family after I am gone, what will I see that will make me truly happy with the planning I did for them?" Don’t focus in on a will, or a trust, or a power of attorney—focus on the picture. Describe what your loved ones are doing, how they are getting along, how the grandchildren are growing up, how your loved ones are missing you . . . yet enjoying the benefits of whatever you were able to leave them.
That’s a different focus, isn’t it?
Let’s go a little deeper with the questions now. Ask yourself:
- "What real-life problems might occur that I would most hate to see happen to my loved ones?"
- "What opportunities could I provide my loved ones? How might I be able to genuinely improve their lives?"
- "What are the strengths of this family that I would like to see built upon? We have a lot of strong points: what are they and how could they be expanded?"
The documents are not what estate planning is about. Documents are no more than tools in a toolbox, available to be pulled out and used as needed to achieve a result you want. Don’t look at the hammer or screwdriver. Stay focused on what you want to build.
What are you looking to achieve for your family? What do you picture happening? How can you make a difference in the lives of those loved ones?
Did you know you can strengthen your child’s marriage? Most traditional planning creates marital tension.
Would you believe you can help assure that your family stays connected?
Do you realize you can assure that your grandchildren develop a strong work ethic?
Have you considered that you can protect your heirs’ inheritance from lawsuits?
Did you know you can promote your spiritual values and family heritage long after you’re gone?
Do you realize you can make sure your surviving spouse won’t be "taken advantage of" by a smooth-talking suitor after you’re gone? And that you can protect your children at the same time?
Did you know that under Illinois law, if your estate includes any real estate or a total of over $100,000 in other assets, it will go through probate—even if you have a will?
Did you know you can avoid estate taxes even if your estate is worth millions of dollars? (OK, most readers don’t have to worry about that one, but it’s true!)
Did you know that you can spell out how you will—and won’t!—be cared for if you become mentally disabled?
Did you know that even if you spend a long time in the nursing home, you can still make sure your loved ones inherit most, if not all, of your property?
Did you know that the less you spend in the short term, the more your family will spend overall on your estate planning? That what you save now by "self-diagnosing" your legal needs you will far more than pay again in the long run? (An ounce of prevention is worth a pound of cure!)
Would you believe this is barely scratching the surface of what you can "build" with your estate plan?
It’s true. But none of this can be accomplished by the typical documents that people customarily ask for, as we described at the beginning.
On the other hand, you can do any of this (and so much more) with an estate plan that is created by a thoughtful and proactive approach, working with a counseling-oriented attorney. Take advantage of the attorney’s years of experience seeing what results clients sought and working through the process of achieving those results for them. Learn from their experience with plans that failed—miserably—to achieve the client’s expectations, and learn how to avoid those pitfalls, most of which end up costing the family many times more than the proactive planning ever will.
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©2014, Curt W. Ferguson, all rights reserved.