5 Reasons Every Parent Needs an Estate Plan

Five years ago, I did not need a will. I had a beautiful dog, Moustakas, and a mountain of law school debt. If I died, I knew that a couple of relatives would fight over the dog but, in the end, he would definitely be taken care of.

Today is different: I am married to the woman of my dreams, I have a brilliant, stubborn, beautiful, shiny little two-year-old girl who is currently summoning me (“Come here, Dada!”), and the same dog, plus two more and a pair of cats. Oh, and a house. If something happens to me, my family needs a plan.

This is as true for me as it is for every parent, and here are five very good reasons why:

5. If you don’t have a will, the state will make one for you.

Many people assume that if they pass away, that their spouse will inherit everything. In some states, this may be the case. But in many states, it is not: the spouse will inherit some of your estate, and the remainder may be divided by your children, children from a previous marriage, and perhaps even your parents. How complicated can it get? Here is just one example from the Model Probate Code, which forms the basis of many states laws – though every state has its own version of these “intestacy” rules:

If the decedent is survived by descendants who are also the descendants of the surviving spouse, and by descendants who are not descendants of the surviving spouse, the surviving spouse takes the first $150,000 of the net estate plus one-half of anything exceeding that amount.

If that doesn’t make any sense to you, and you are not alone. And if you want to have any say in where your property goes after you go, you should not leave it up to laws like that.

Under that same probate code, your property could be divided up at least half a dozen ways, depending on whether or not you have children with her current spouse, children with someone other than your current spouse, living parents, etc. Also, if your children inherit property under these laws, but are not old enough to manage the property, someone will have to petition the court to manage the money on their behalf, adding unnecessary legal expenses and delays in accessing the resources needed to provide for your children. Intestacy laws are complicated, to say the least.

The only way to be certain about what happens to your property is to make your wishes known. And if you don’t do so in writing (a will or trust), don’t expect anyone to actually adhere to those wishes.

4. You will want to decide who raises your children.

We all have relatives that we cannot stand. And we all have relatives that, while we enjoy spending time with them, we may not agree with their parenting styles.

If you die without a will, the question of who gets the honor of raising your children is a pretty open-ended one and it may result in your children being raised with the wrong relative, in the wrong religion, or without adequate care, supervision, and resources.

The only way to be certain about what happens to your children is to make your wishes known. Again, do so in writing.

3. Proper planning prevents painful probate processes.

I had to paraphrase an Army-ism for this point, but this much is true: if you plan now, you will save your loved ones a world of pain after you are gone.

When someone dies intestate (with no will), their loved ones typically have to hire a probate lawyer to file a case in probate court. The court will go through all of the deceased person’s assets — on the public record — and assign those assets out according to what the law dictates. If that sounds like a lengthy and expensive process, it is.

If a person has a will, that will still has to go to probate court. However, because the judge already has a list of instructions, the process goes much more smoothly. In addition, if the deceased person was wise enough to take advantage of transfer on death deeds or pay on death bank accounts (available in some states only), his or her loved ones will have access to the resources they need sooner.

And, of course, there is the ultimate plan: the trust. A revocable trust is more expensive and time-consuming to set up, but the benefits are massive. I often compare it to a corporation owned entirely by you, set up for the benefit of you during your life, and for your loved ones after you pass away. Because all of the property is owned by the trust, the person managing the trust can distribute the property however you dictate without even going to probate court. Your loved ones have access to the property pretty much instantly after you are gone, plus there is the added privacy bonus of not having your personal items indexed in a public court of record — everything is handled by you, and the people you trust, rather than by a court and a bunch of lawyers.

If your children are minors, you need to have a probate avoidance plan in place so that whomever is graced with their care after you are gone has access to necessary resources immediately. Whether that probate avoidance plan involves special bank accounts, special titles, or a full trust is a decision best made with the advice of an attorney.

If your children are adults, they may not need the resources immediately, but avoiding a lengthy probate process will save them years of emotional turmoil and may minimize conflicts between those children over who gets what property.

2. Save your family the agony of making healthcare or end-of-life decisions.

Though a will does not typically address healthcare or end-of-life decisions, most attorneys will prepare documents that do handle these issues in conjunction with a will as part of a package. For example, my firm includes the following in a will package:

· The will (deals with property and child guardianship);

· A financial power of attorney (typically takes effect when you are unable to manage your financial affairs and gives a loved one the ability to handle them for you);

· An advance directive and healthcare power of attorney (also known as a living will, this outlines your wishes with regards to your healthcare and any treatment options when it comes to worst case scenarios of dementia or vegetative states. It also appoints someone to make decisions in conjunction with your outlined wishes.);

· Burial or cremation instructions.

Put yourself in your spouse or closest relative’s shoes: does he or she know whether or not to resort to extreme measures to try to preserve your life? Would they be able to make that call, emotionally speaking, without being deeply traumatized? Is there someone else in your family that is more well-equipped to handle that role?

1. It has never been easier to get a plan in place.

Lawyers are expensive. And nobody likes to think about death. That may be why the majority of Americans do not have a will or trust in place. Not only is it an unpleasant topic, but who wants to sit in traffic for an hour just to sit in a stuffy lawyer’s office to discuss these very unpleasant topics and you get the privilege of paying thousands of dollars to do so?

We get it. When I re-launched my practice in 2018 after moving from California to New York for my wife’s career, I had a unique opportunity to address many of the things that I knew were wrong with how us lawyers practice law on a daily basis. One of the first things I did was to structure my law firm as online first, meaning we were doing Zoom meetings with clients and saving them commute time long before pandemics and lockdowns mandated it. I have done a trust for a client in California, while sitting on a veranda in Manila, and I regularly handle legal work for people across the country today, while working out of a home office in New York City.

The other thing I did was use my tech background to adopt as many cost-saving technologies as possible, such as automated billing, case status updates, and document drafting assistance, to ensure that I could lower my overhead and by prices while continuing to provide the quality work that my clients need. We also use technology to enhance the client experience: online archives of your estate plan, text and email updates on your case, and the ability to simply text your lawyer a question are things you won’t find in most firms.

Finally, when the pandemic did hit, my wife and I were among the first to get sick — possibly due to her status as a front-line doctor. The situation really hit home for me at that point: there I was, a guy who had never been sick and until a few years ago, didn’t have a wife or kids to worry about. And there I was an estate planning lawyer with no plan. Meanwhile, the same was true for my wife, who is still on the front lines today, treating COVID patients.

We needed a plan. And you do too. Though I cannot provide free services to everyone who reaches out, I have lowered my rates temporarily to a level that I hope makes them accessible to nearly all parents out there, while still allowing me to pay the exorbitant costs that it takes to be a lawyer (seven states’ bar dues, insurance, software licenses, etc.). We are offering a will package for an individual at $300, or a couples’ package for $500. We’ll get you a solid will in place for now, and will follow up after the pandemic to wrap up anything we can’t get done with limited access to notaries and the other issues that shutdowns and quarantines bring.

Give us a call today at 929-4-EP-FIRM for a free consultation, where we will address any questions you may have about the process and what plan may be the best fit for you.

Leave a Reply

Your email address will not be published.