Do your parents have an estate plan? Is it up to date? No matter how rich or poor you or your parents are, especially in the wake of the COVID-19 pandemic, you need to be asking these and several other questions. When your parents become incapacitated or die, their affairs will become your responsibility, and it will be impossible to ask them to clarify anything. So, if you do not know whether or not they have estate planning in place that will help you best support them, read on.
The Best-Case Scenario
In a best-case scenario, your parents have an updated estate plan, and they have walked you through it. They have provided an inventory of their assets that is easy for you to find listing out everything they own, how it is titled, and who it should go to and how. Ideally, it also includes directions on how to handle their non-monetary assets, and an audio recording or written stories that pass on their values, insights, and experience. On top of all that, it is best if they have introduced you to the lawyer who set it all up, so you know who to turn to when the time comes.
If that is not the case, you could have some holes to fill. If they have not done any planning at all, now is the time to encourage them to get it done, and support them in any way you can. If they already have a completed plan, it is likely that it has been sitting on their shelf or in a drawer for years, not updated, with no inventory of their assets and no way to capture and pass on their intangible assets. Even worse, their lawyer could have been using outdated systems that are no longer recognized, which can lead to trouble down the road.
It is also possible they have never updated their estate plan, it no longer tracks with their current assets, and may even require complex actions that are no longer necessary upon their death. Worst of all, you may have no idea what your parents own or how to find their assets, and at their incapacity or death, you will be left with a mess, even though your parents had good intentions and thought their planning was handled.
The Worst-Case Scenario
In a worst-case scenario, your parents may have worked with someone who uses one-size-fits-all form documents or cookie-cutter estate plans. This person may have created an estate plan that does not reflect the needs or desires of your parents and is unlikely to work when your parents really need it. How can you spot this kind of person? He is the one selling cheap documents without any systems in place to ensure your plan is comprehensive and works as intended throughout life. If it is too good to be true, it usually is. Buyer beware.
Either way, it is critical for you to know who your parents have worked with to create their estate plan, and how and why they made the choices they did. If you are not in the know, now is the time to find out.
If you and your parents are already discussing these matters, but have not yet included you, you can ask them to schedule a family meeting with their existing attorney. On your parents’ request, that attorney should look forward to walking you through your parents’ planning, the choices they made, and how you will be impacted in the event of their incapacity or death.
You want to develop a relationship with their estate planning attorney now. This advisor can be one of the most important supporters of you and your parents during your time of need. It is a relationship you will want to establish before you need it, so you won’t be scrambling during a time of crisis.
If you need support to have these conversations with your parents, let us know. We can help.
This article is a service of the Law Office of Keoni Souza, LLC, an estate planning law firm in Honolulu, Hawaii. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love. That's why we offer a Family Wealth Planning Session, ™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. You can begin by contacting our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $750 session at no charge.
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