The New York Times posted an article a couple weeks ago on the way families are forever divided when there is a rift in how an estate is split (http://www.nytimes.com/2014/06/21/your-money/unequal-inheritances-may-ignite-family-squabbles.html?_r=1). The lessons that the article points out are reflective of the same issues we see every day.
Plan Ahead: Putting an estate plan in place is critical to mitigating future issues. Do it when you have full functions, and there is no question about your mental capacity. In the article, grandma planned ahead, but made substantial changes on her death bed. By not planning ahead, she opened the door to the issues that led to the court battle.
Get Advice: We cannot all be good at everything. And when it comes to estate planning, there are so many nuances and pitfalls, that getting proper advice is critical. Attorneys that only practice in the area of estate planning, such as the ones at MH, can navigate the issues, and provide the invaluable insights of their experience. The article does not talk about an attorney’s involvement in the drafting of the plan, but based on the outcomes, even if there was counsel, it was not very good.
Understand your plan: When you are talking with your attorney, make sure you understand what happens to your estate, and the pros and cons of the choices you make. In most plans there are provisions for what happens to a beneficiary’s share if she was to die; make sure that is what you want to have happen. In the article, the grandmother lost one of her children. The original plan provided that the share goes to the child’s children (i.e. the grandchildren), but the last change cut the grandchildren out, and only provided for the living children. If this was grandma’s true intent, it should have been drafted that way from the beginning.
Review your plan: We encourage our clients to come to the office to have their plan reviewed every three years. We want to make sure that if there are life changes, those thoughts and wishes are reflected in the plan. The article indicates the plan was updated a couple of times, but the key is to have regular reviews. Don’t wait until you think an update is needed; the regular reviews keep your wishes well documented.
Losing a loved one is always an emotional experience. To not have a proper plan can make that experience even worse. More than just the financial costs, are the cost of the familial relationship. Don’t let that happen to your family. Make an appointment to meet with one of our attorneys to have your plan reviewed or created.
Don’t let ineffective or no planning cause the division in your family. See us today.
Contributed by MH Estate Planning Attorney, James P. Plitz.
About Morris Hall:
At Morris Hall, we have focused our legal practice on estate planning for over 40 years. Along with estate planning, our attorneys help clients and their families with matters of probate, trust administration, wills, power of attorneys, business planning, succession planning, legacy planning, charitable gifting and other important legal aspects. We also have divisions in financial, real estate and accounting to help you incorporate all of your planning together, ensuring that everything works perfectly for your needs and situation. Our Arizona offices are located in Phoenix, Mesa, Scottsdale, Cave Creek, Tucson, Prescott, Flagstaff and Arrowhead. Contact us today at 888.222.1328 to schedule an appointment!
This blog should be used for informational purposes only. It does not create an attorney-client relationship with any reader and should not be construed as legal advice. If you need legal advice, please contact an attorney in your community who can assess the specifics of your situation.
- What the Proposed Treasury Regulations Mean for Deductions Under Internal Revenue Code Section 2053 - September 16, 2022
- Does Your Estate Have Sufficient Liquidity? - September 14, 2022
- Understanding Asset Protection Trusts - September 12, 2022