Talk about a misconception.
One estate planning attorney says what many peers likely agree with regarding a number of first-time clients, namely this: Many of them enter his office with expressed concerns about losing control over their assets once they enter down the planning road.
In fact, the outcome is precisely the opposite, but, for a number of reasons, many people don't appreciate that until they enter into a candid, comfortable and comprehensive conversation with a planning professional.
The concerns that aging parents have with growing older, as well as the concerns harbored by younger family members who want the very best for their parents as they advance in years, are singular and age-specific. Moreover, they often tend to center on a few discrete issues.
In many instances, of course, health care is at the very top of issues that family members address, given the obvious fact that most persons have a progressively diminished capacity to care for themselves entirely as they approach or enter into their end-of-life years. We alluded to such health care considerations in our immediately preceding blog post (please see our November 21, 2013, entry).
We also touched on a few other elder law concerns in that post that predominate in most families. One of those is obviously finances, which can lead to wide-ranging family discussions regarding asset identification, protection and management.
Contemplate for a moment this hypothetical, which moves from the potential to immediate reality for millions of Americans, including Texas residents, each year.
You've noticed with growing concern that the natural aging of your parents is recently bringing new and rapidly befalling consequences that you -- and perhaps your siblings, if you have brother and sisters -- haven't really anticipated and are unprepared for.
Mom might be forgetting important things, for example. Dad has perhaps fallen repeatedly and lost mobility. Bills are not being pay on time, and there are sudden discrepancies in savings and other investment accounts. You lack any real knowledge concerning your parents' assets -- or debts, for that matter -- or their wishes regarding the future. Such matters have never been broached within the family.
They need to be.
Estate planning and administration is one legal sphere that certainly qualifies as a realm within which many complex considerations apply and special experience in a number of enumerated areas is of critical importance.
That might seem obvious to many people, but it is also understandable that lay persons often do not readily appreciate how important hard-earned skills and knowledge over relevant subject matter are to the outcome of an estate plan.
Put another way: The goals of an individual or family can be materially undermined by an attorney -- even the most well-intentioned lawyer -- lacking the requisite background and experience to put them into effect.
It is certainly a common and valued goal of many American families to pass along the wealth they have secured to future generations. Notwithstanding that aim, though, and according to one estimate, only about 10 percent of those seeking to do so see that hope realized over the long term -- that is, to the fourth generation of descendants and beyond.
As noted in a recent Reuters article on estate planning, "Family wealth tends to dissipate over time."
That can especially be the case when families are large, far-flung and complex, with multiple kids, grandkids, spouses of offspring and step-relatives.
In such an instance, estate planning can become tricky.
OK, that above headline might seem just a bit baffling, but looking at estate administration for a moment from the perspective of home building is arguably educational and quickly informative.
Consider that if you take care in constructing a home, it is generally the case that only occasional and anticipated -- and, hopefully, minor -- tweaks are required in subsequent years to keep it up to date and in good working order.
Exactly the same is true with estate planning. "[I]f we take some time to think about the major things ... and double check that the right people are on the right documents, it can go a very long way in the end," says one financial planner.
A common misconception among many millions of Americans that is frequently pointed out by estate planners, financial advisers and many wealth-related consultants and commentators is the view that only comparatively old and well-established individuals and families need estate plans.
In fact, sound estate planning encompasses far more than mere wealth-sheltering strategies for well-heeled persons and their heirs. Indeed, and as we noted in a recent blog post (please see our October 2, 2013, entry), thoughtful estate planning is an invaluable undertaking for most Americans, without regard to station.
When distilled to its very essence, that seems to be the bottom-line message when it comes to family members all being on the same page in the realm of estate planning. Candid, early and consistent communication between parents and their kids regarding family assets, expectations and the future is critical in paving a smooth road in upcoming years, after an estate plan has been fully revealed and is implemented.
A couple hypotheticals can serve to put the above blog title into quick perspective for our readers.
Say that an individual or couple in Texas or elsewhere comes to an estate administration attorney to discuss asset protection, legal tax avoidance and other matters centrally relevant to the passing of their estate to their heirs and loved ones. They have a house, a boat, cars, jewelry and various savings accounts.
Now imagine conversely that they don't have much of anything -- except for patent rights to an industrial process that hasn't panned out yet, or perhaps a singular set of collectors' items that no one has paid much attention to.
In a recent Forbes article, the CEO of a leading online platform offering financial education to individuals and families sums up a mainstream misconception that persists regarding estate administration.
In a nutshell: It’s only for the wealthy.
Liz Davidson takes that even a step further by enlarging the prototypical image that many “common” Americans associate with estate planning, namely, that of the tycoon, well-heeled industrialist or long-moneyed family concerned with sheltering mansions and other pricey investments.
In fact, Davidson says, “estate planning is really something we all need, no matter our age or level of wealth.”