Wednesday, May 20, 2009
Agenda for Parent-Child Estate Planning Coversation
I have recently been talking with families that do not know very many details about the Estate Planning that may or may not have been completed by their parent(s). When I hear this, I am often asked how to bring up such a difficult topic, or what types of questions should be asked. We have put together an agenda to guide you through this conversation. If they do not have an estate plan, we are happy to discuss how we can implement one for them today.
1. Do you have an estate plan, and if so, what type of plan?
Finding out whether your parents have an estate plan, and the type of plan they have is beneficial because you will be able to anticipate what will happen upon their death or incapacity. For example, if they don’t have an estate plan, you can anticipate that their assets may need to go through probate.
2. If your parents have a trust based plan, does the trust contain the appropriate property?
One of the main benefits of a trust is that trust assets avoid probate. However, the trust must own the assets in order to receive the protection of the trust. Many attorneys rely on their clients to fund their own trusts, but don’t instruct their clients on the disastrous results that could occur if they fail to do so. In order to take full advantage of your estate plan, it is important to know which assets should be put into the trust, which should not, and the appropriate means of holding title to all of these assets.
3. Who has been designated to take care of the financial decisions in the event that your parents cannot, and what financial decisions need to be taken care of?
It’s important to know who is responsible for taking care of your parents’ financial decisions upon incapacity or death. Identifying and notifying that person ahead of time will allow that person to step into your parents’ shoes quickly, should it be necessary. You may also suggest that your parents make a list of things that need to be taken care of, such as: paying the mortgage, paying medical bills, accessing bank accounts, picking up the mail, etc. It is easy to over look financial responsibilities when a loved one is incapacitated, and this will provide the Power of Attorney or Personal Representative with clear directions and ensure that nothing is overlooked.
4. Does the plan include health care documents? If yes, who has been selected to make the healthcare decisions for your parents upon incapacity and/or death, and what are their wishes?
Not all estate plans incorporate healthcare documents. Some of the documents you should be looking for are a HIPAA Authorization, Healthcare Power of Attorney or Advance Health Care Directive, and a Living Will. Combined these three should indicate who is to make the medical decisions upon incapacity or death, provide them with the power to make those decisions, allow disclosure of confidential medical records, and dictate the person’s wishes at incapacity or death.
5. Where is your estate plan located?
Having an estate plan is great, but if you don’t know where it’s located, then you will not be able to carry out your parents’ wishes. Also, you may want to recommend that your parents keep it in a place that is accessible, and confirm that the estate plan contains their attorney’s information in the event that there are questions or concerns. Many of the decisions need to happen quickly, and this will make the transition simpler.