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Will Your Estate Plan Work When It's Needed?

Definition of an Estate Plan That Works


One glaring problem that I see time and time again in my estate planning practice is that in reality most estate plans simply don’t work. There are a multitude of reasons why estate plans fail, ranging from inadequate documents, to overlooking how assets are titled, to forgetting to update beneficiary designations, to failing to properly address family problems and dynamics.

With that said, what is the definition of an estate plan that will work for you and your family when it's really needed?

  1. Control of Your Assets While You're Alive and Well. First, you want to have an estate plan in place that gives you total access to, and control over, your property while you're alive and well. This won't be the case if your assets are jointly titled with someone other than your spouse or if you fail to follow through on the terms of a property settlement agreement after a divorce.

  2. Control of Your Assets While You're Mentally Disabled. Second, you want to have an estate plan in place for you and your family in the event you become mentally incapacitated. Without a disability plan, your assets will end up in a court-supervised guardianship or conservatorship and you and your family will lose total control. Disability planning includes taking care of both you and your property in the event that you can't take care of yourself due to an injury or illness.

  3. Control of Your Assets After Your Death. Third, you want to have an estate plan in place after your death that insures that your property will go to whom you want, when you want, and in the way you want. The alternative is to allow the state where you live at the time of your death to make your estate plan for you, and in most cases the state’s plan wouldn't be the plan you would have chosen for yourself had you taken the time to make an estate plan. Instead, you can put an estate plan in place that passes your property on to the beneficiaries you personally choose to inherit your assets and then, if necessary, protects the inherited assets from the beneficiaries themselves, their spouses, their children, and outside influences.

  4. Privacy When Settling Your Estate. While Last Will and Testaments that are filed with the local probate court become public court records that anyone can read, there are ways to keep the terms of your estate plan a private family matter that is only revealed to the beneficiaries of your choice. And aside from a Last Will and Testament becoming a public court record, the majority of documents filed with the probate court will also become public court records, which means that the names and addresses of your beneficiaries and information about what you owned and who you owed money to at the time of your death will be available for anyone to see.

  5. Control of the Costs Associated With Settling Your Estate. Finally, you want to have an estate plan in place after your death that minimizes both the financial and emotional costs associated with settling your estate. This includes planning to avoid probate, planning to minimize estate taxes, and planning for the payment of debts and estate taxes. Otherwise, it will be the government and the lawyers who will be the ultimate beneficiaries of your estate.

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