I can’t quite put my finger on why, but folks have an awfully hard time discussing their estate planning, their finances, and their wishes with their family. Whether it stems from a denial of mortality or simple modesty, most people do not have frank conversations with their loved ones about their Wills or Trusts – which often leads heirs into a mess as they put the pieces together after the fact.
A recent ABC News story story encourages people to be more transparent in their planning with beneficiaries, and shines light on the need to regularly review estate plans to make sure that what you wanted 5 years ago is still what you want today.
Even as an experienced estate planning attorney, I found several points in the article worthy of notice. First, the author asserts that estate planning is one of the “least understood, and most neglected areas of personal finance.” Boy, ain’t that the truth!
Because estate planning is an area of law that intersects with personal finance (and mass-marketed solutions), people apparently feel comfortable attempting it by themselves or with the assistance of the Internet. As a result, there isn’t a meeting that goes by where I don’t correct someone’s misperception of the law or the result of certain decisions. Part of my job is certainly to be an educator.
The real danger with estate planning being one of the least understood areas of personal finance is not what people don’t know. It’s what they think they do know – often with disastrous results. Unlike other financial mistakes, there’s no second chance to make the correct decision. You’re stuck with the plan you have when you die. Make it a good one.
Do-it-yourself estate planning solutions like Legal Zoom have a legitimate function. Although it drives specialists like me crazy, I’d rather you have a will from Legal Zoom than no will at all. But as a friend of mine says, having a prescription pad does not make you a doctor. Internet wills and trust often result in unintended consequences, disappointed or angry beneficiaries, and a real mess.
Take this lesson from this post – the cost or penalty for having a poor plan in place is more than financial or pecuniary. Often the emotional costs – like those described in the ABC story above – are much greater. If you believe that caring for your loved ones after you’re gone is an important activity in your life, meet with a professional and commit to reviewing your plan on a regular basis.
Posted by Victor Medina,
Medina Law Group, LLC