One of the most common questions that I'm asked as an estate planning attorney is, "Who should I tell about my estate plan?" As with most of estate planning, the answer isn't a simple one, and the estate planning attorneys I know don't agree on what they think that their clients should do.
Keeping Your Estate Plan a Secret
Many people believe that their estate plan should be kept as a private matter and no one other than their estate planning attorney should know about it. Often times this stems from their desire to keep their true net worth a secret from their children or other beneficiaries. This does add a level of protection against challenges - if the beneficiaries don’t know that they were a part of the original estate plan in the first place, then they can’t challenge an updated estate plan that cuts them out or reduces their share. But it can also lead to confusion after someone dies: "Why did he do it that way?" "Why did she choose her as personal representative?" "Why did he think that I needed a lifetime trust?" "What does it all mean?"
Sharing Your Estate Plan With Your Loved Ones
On the other hand, many people speak openly and often with their loved ones about their estate plan and what it does and doesn’t do. This can promote peace of mind within the family to know that all of the loose ends have been tied up. But if the plan is later changed and all of the beneficiaries aren't informed, then confusion and challenges will be the result. Aside from this, many times an estate plan can only do so much and some clients misundstand the true extent of their plan, and so they in turn misinform their loved ones about how their estate plan works.
I've also worked with clients who use their plan as leverage against their beneficiaries: "If you don’t behave in a certain way or do a certain thing, then I’ll cut you out!" I won’t comment on this other than to say that in these situations, constant updates to an estate plan based upon one’s ever changing family situation leave it wide open to challenges and lawsuits.
What Should You Do?
So what should you do? At the very minimum let your fiduciaries know that you've named them, or they'll be in for a big and perhaps unpleasant surprise. In fact, by informing your fiduciaries you'll learn who really doesn't want to or can't serve, and that leaves you free to move on to someone else. The worst thing that can happen is that even after you've taken the time and spent the money to create a solid estate plan, all of the fiduciaries you've chosen can decline to serve, and then your loved ones will end up in court trying to find a suitable fiduciary who is willing and able to serve.
And at the very minimum you should also let your loved ones know:
- That you've created an estate plan;
- Where your original estate planning documents are being stored; and
- The contact information for your estate planning attorney.