Estate planning can be a difficult subject to address. For many, it brings up unpleasant topics of aging and death to the forefront of their minds, which can lead them to procrastinate or downplay the importance of having a will or trust. Sadly, when individuals fail to plan, it is the family members that are impacted the most.
In 2008, Congress designated the third week of October as National Estate Planning Awareness Week in an effort to help the public understand the importance and benefits of estate planning. Despite this, as of a 2019 survey, 57% of adults in the United States do not have any estate planning documents such as a will or trust, even though 76% of respondents viewed them as important. Many said this was due to procrastination, while others mistakenly believed it was not necessary because they did not have many assets.
Anytime is a good time to talk to family members–especially elderly parents–about their estate plan. The topic can be uncomfortable, but having a proper estate plan can provide significant peace of mind for them and you by ensuring their life savings are protected, plans are in place in the event they become ill, and their property is passed down according to their wishes. Here are some important discussion points and a few tips to help you start the conversation.
Be sensitive to your family members’ feelings. Put yourself in their shoes, and keep in mind that few people are eager to dwell on the subject of their own mortality. One way to begin the conversation is to talk first about the need to plan for illness and to provide instructions in the event they become too sick to communicate with doctors or manage their own finances. The conversation can naturally progress to the importance of having an estate plan that will enable their life savings to be transferred in the way they wish, provide for the care of any children or pets, and minimize taxes, court costs, and legal fees. Communicate that you are not trying to control their decisions, but only want to ensure that their wishes regarding their medical care and their property are known—and that their instructions are in writing to guarantee they are honored.
Involve other family members in the conversation. If you plan to speak to your parents about estate planning, it is important to try to include any siblings in the discussion to avoid giving the impression that you are trying to influence or control your parents’ choices. You and your siblings should emphasize that none of you are asking about what you will inherit. You just want to make sure their wishes are known and honored.
Address several key topics.
- Ask if your family members have a last will and testament and/or a trust, and explain that if they do not have these important legal documents, state law will determine who receives their property—and it might not be the people they would have chosen. Also, a judge will decide who is entrusted with the management of their estate and the care of any surviving minor children or pets. Having their wishes spelled out in a will or trust can also help prevent confusion and potential conflict between family members.
- A financial power of attorney will allow them to designate an individual to manage their finances and property if they are unable to themselves. Inquire about your family members’ powers of attorney, and encourage them to identify the best individuals for the job.
- Make sure your family members have proper medical powers of attorney and advance directives in place. These documents contain their wishes regarding their medical care and enables them to designate a trusted person to make medical decisions on their behalf if they are unable to do so themselves.
- Find out whether they have insurance and the location of the insurance policies. If your family member becomes incapacitated or dies, it is important to have this information so that claims can be filed for benefits and so other types of policies, such as homeowner’s or auto insurance, can be modified or terminated.
- Ask them to compile a list of accounts and property and other important personal information which would be needed to wind down their affairs once they are gone, including: bank and investment accounts, vehicle titles, deeds, credit card accounts, digital accounts and passwords, Social Security cards, passports and birth certificates. This information should be kept in a safe place and shared only with trusted family members or loved ones.
- A list of legal, financial, and medical professionals who have worked with your family members is also important. Be sure they include doctors and care providers, financial advisors, insurance agents, CPAs or tax professionals, business partners, and others. The list should include the professionals’ contact information so they can be easily reached in the event help is needed.
Once you have this important conversation with your family members, they might realize it is time to contact an experienced estate planning attorney who can help them create an estate plan tailored to meet their needs and carry out their wishes. They might also realize they need to update a plan that no longer fits their goals.
eLegacy makes it easier than ever to check this important task off their list. Now they can meet with an estate planning professional and update an existing estate plan or create a new one, all within the comfort of their own home or office. Help bring yourself and your family members peace of mind and contact eLegacy today to schedule a complimentary consultation.