Dear Mr. Premack: I am young and am just starting. But I have a good job. I got married last year. We are buying a new car, are considering becoming first time homebuyers (maybe), and have started a small retirement savings account. Since you’ll answer a legal question for me, I’d like to know if I (we) should be thinking about making Wills, too. Like I said, we are just starting to build some savings, so why would we do estate planning? – C.E.
To answer your question, you must start to think about the future in terms of best-case and worse-case scenarios. The best case is that you live to a ripe old age, accumulate great wisdom, have the love and admiration of your family, earn wealth adequate to provide a comfortable lifestyle, and die in your sleep. The worst case scenario is, well, the opposite. Illness, disability, death at too early an age.
Both scenarios have one thing in common, the certainty that Benjamin Franklin lumped together with taxes: all of us will die someday. Since that is a certainty, the real questions are: 1) How do you want to treat the people and the assets that remain when you die? and 2) How do you prepare for the possibility of becoming ill, incapacitated or disabled?
As they say in the movies, “We can do this the hard way or we can do this the easy way.” In the case of estate planning, the hard way means that you take no action, you ignore the worst case scenario, and you leave a mess for your loved ones and for your survivors. HARD for your loved ones and your survivors. The easy way means that you take responsibility, see an experienced estate planning attorney, and make a plan designed to make your death just a bit less difficult for your loved ones and your survivors. Some may think this is harder, but others enjoy the control pre-planning allows. Your pre-planning makes it easier on those you love.
Specifically, what should you do to prepare an estate plan?
Rule 1: Think about the worst case scenario. Make the hard decisions.
Rule 2: Always go to an attorney whose practice focuses on estate planning. If you are not certain about what questions to ask or what ramifications may grow from decisions you are pondering, call on the attorney’s experience to guide you to sensible answers. This means avoiding online form preparation because a) you need personalized advice and guidance, b) the websites cannot give legal advice, c) the forms they produce are usually inaccurate and fail to take advantage of all the law’s intricacies and d) they are not confidential and they share and sell your private information.
Rule 3: After you make the hard decisions, ask yourself what could go wrong, and make a backup plan.
Rule 4: Decide who you trust. You need an Agent (and two backups) to assist you financially and medically if you become disabled, and need an Executor (and two backups) if you should die.
Rule 5: Ask your attorney to keep it simple. You do not need a 30-page Will or a 90-page Trust. Understand, however, that the more issues you address now, the more answers your survivors will have when the time arrives. Execute the documents necessary to solve the issues to be faced, which may include a Durable Power of Attorney, Medical Directives, a Will, a Survivorship Agreement for community property, a Trust, a Marital Property Agreement, and other documents.
Rule 6: Keep the signed documents in a safe place, and be sure your Agent and Executor can access the documents when the need arises. File your Durable Power of Attorney with the County Clerk.
Rule 7: Keep your documents up-to-date. Do not let them age more than 10 years. Review your decisions, for just a few minutes, at least once a year. If your circumstances have changed (new baby, divorce, move to a new state?) then go back to your attorney to revise the documents.
When you bought your new car, you were required to buy auto insurance. You did, and you pay the premiums to the insurance company. If you are in an accident, the insurance covers your risks. If you buy that new house, you will buy homeowner insurance. If the house burns down or the roof is damaged in a storm, the insurance company covers your risks. You should, likewise, have a legally binding plan stating your instructions for who gets the car, who inherits the house should you die, and who will speak for you if you become disabled. Put a bit of the burden on yourself now, and your family will benefit.
Paul Premack is a Certified Elder Law Attorney in San Antonio. His firm has offices in Texas and Washington, and handles estate planning for all ages, probate law and business entity formation issues. Submit estate, probate, elder law and LLC questions at www.Premack.com or go there to view the archive of past legal columns.
This column first appeared in the San Antonio Express-News on August 4, 2014. Click here to read the column at the MySA.com website.