One of the common statements I hear from clients is this: “I just need a simple will”. I hear it all the time. According to legal blogger, Katya Sverdlow, ninety percent (90%) of the people who say, “I just need a simple will,” are wrong.
I am not sure about the percentage, but I know what she is saying. I wouldn’t go so far as to say that ninety percent of the people who say they need a simple will are wrong, but I may be nitpicking a little bit.
First of all, I would ask, “What do you mean by a “simple will”? Most people couldn’t answer that, and that is the problem. I believe the blogger’s point is that most people don’t really know what they need.
While a “simple will” may ultimately accomplish your goals, the thought process to arrive at that conclusion isn’t usually as simple as most people suppose. Most people don’t know all the questions they should be asking themselves, and most people don’t think about all the things they should be considering when doing estate planning.
This is not meant as a slight to anyone. It’s just that we don’t learn about estate planning in high school, college or even in graduate school. Unless you have a law degree or spend time talking to a lawyer or a certified estate planner, you don’t know what you don’t know.
Even among lawyers, the knowledge of estate planning is generally basic unless the lawyer focuses his or her practice on estate planning. Estate planning isn’t a required course in law school. Even then, a lawyer relying on that one class in law school would be committing malpractice to do much estate planning without continual and ongoing research and study.
Laws change and the nuances are legion. Even after 30 years of doing estate planning, I run into unique situations on a regular basis that require me to do research and learn something new. Having done it so long, though, I know where to look for those rocks that might sink the ship we are trying to guide into the port. I know when I am getting into territory that requires extra due diligence.
It isn’t always the legal issues that are so complex, but most people don’t know what the legal issues are. Unique fact circumstances, especially with blended families can greatly complicate estate planning. Estate planning involves the juggling of many moving parts and organizing them into a unified whole that will the ends that are desired.
Do you have a significant other? Are you married? Do you have children? Are the children both of yours? Or are there children from a previous relationship? Will your spouse remarry if you pass away? Will you remarry if your spouse passes away.
Do you have children? Are they minors? Who will be their guardians if you are gone? Who will manage your estate for them? Are they close in age or spread apart? Will they go to college? Will all of them go to college? At what age should they have unfettered access to your estate?
Are your children married? Will they get married? Do they have children? Will they have children? Do they have any individual concerns, like drug or alcohol use, job issues, lack of appreciation for the value of money, mental health or physical needs, special needs? Are they easily influenced by others?
If you don’t have children, where do you want your estate to go? Who should get it? Who should handle the administration and management of it?
Do any of your beneficiaries have issues that may become problematic if they receive money from you outright? Are there tensions in your family? Do you anticipate anyone causing a problem? Do you plan to cut out any family members? Might one of them contest your will?
What happens if one of your children or other beneficiaries dies before you do? Are you ok with your estate going directly to beneficiaries? What if they are minors? Does it make sense for them to have unfettered access to your estate when they turn 18? When should they receive it? Who will manage it for them in the meantime? How should it be managed?
These are questions that only delve into your relationships, and I am only raising some of the considerations here. Each person and/or couple have their own unique set of answers to these basic questions. Each answer raises additional considerations that need to be discussed.
I haven’t even gotten into the subject of the assets that you own. Do you own your house outright? Or does it have a mortgage? Do you own it with another person or people? Do you own it in joint tenancy, tenancy in common or tenancy by the entirety? Do you own other real estate? Do you own real estate out state?
Do you have assets with beneficiaries designated to receive them? Have you thought about how beneficiaries should be handled in light of a will? Have you thought through all the ramifications of designating beneficiaries or leaving those assets to be directed by your will?
Do you have assets for which a payable or transfer on death designee can be named? Have you thought about how payable on death designations should be handled in light of a will? Have you thought through all the ramifications of naming payable on death designees or leaving those assets be directed by your will?
If you have set up your estate for most assets to pass by beneficiary or payable on death designations, who will handle the administration of your estate? Where will the money come from to pay your final obligations?
If you become incapacitated and unable to make decisions for yourself or manage your own affairs, what will happen to you? Who will be your guardian? What will happen to your assets? If you become incapacitated, who will make medical and personal decisions for you? How will they be guided in making those decisions.
If you have added the name of a son, daughter, or other family member or friend to your bank account so they can pay bills for you if you can no longer pay them yourself, did you know that you have gifted your account to that person? Did you know that your account is now subject to their creditors or could be subject to distribution by a judge if they get a divorce?
These are just some of the questions that need to be asked when doing estate planning. Every answer will require some discussion. Each answer leads to other questions. Answers to some questions may require you to rethink answers to other questions.
I like to say that estate planning isn’t rocket science, but it’s rarely as simple as people suppose. Each person and family has a unique set of factors that include a combination of the relationships, assets you own, how you own them and desires for what you want to accomplish that require careful consideration in relation to the whole.
It’s like putting the pieces of a giant puzzle together with movable pieces. Those puzzle pieces can fit together in different ways, but moving one piece often requires consideration of moving one or more other pieces so the puzzle fits together in a way that makes sense for you and addresses all of your concerns.
If you don’t think it through and factor in all the considerations and ramifications of your decisions, you can leave a mess for your loved ones that will be difficult for them to unravel. Bad estate planning or a lack of thoughtful estate planning can cause more heartache then blessing. Most people don’t want to leave a mess behind.
Katya Sverdlow poses this final question in a short video blog she posted recently: “Are you going to leave a simple will? Or thoughtful one?”
Her questions are right on the money. If you want to leave a well thought out estate to your loved ones that is more of a blessing then a curse, don’t try to blaze a trail through the estate planning jungle without the proper tools and guidance on how to use them.
For estate planning in New York State or New Jersey, you could look up Katya Sverdlow. If you need estate planning in Illinois, click on the link below to get more information, including an Estate Planning Worksheet. You can also set up a Zoom or in-person meeting with an attorney who can get you started on the road to complete a well thought out estate plan.
To receive a worksheet and set up a meeting to prepare your estate planning – contact us!