Do I need a will?

People often ask me things like this. “Do I need a will?” “Should I set up a trust?” “Do I need to do anything so my husband/wife/kids will get my stuff after I’m gone?”

Beats me.   I dunno.   Maybe, maybe not.

The fact is, these questions simply can’t be answered without knowing a lot of details about the questioner’s circumstances, desires, and plans. And when all is said and done, the only person who can really answer them is YOU.

But to do that, you have to really understand your current estate plan, and all of the other options that are available. And an experienced estate planner can help you get that information.

“My estate plan? But I don’t have an estate plan!”

Everyone has an estate plan. If you haven’t made a will or set up a trust, State law will determine who gets your things, how a guardian is selected for your children, and how much is paid in taxes. If you don’t have a power of attorney, advance health care directive, or living trust, State law will determine who can handle your finances, make health care decisions for you, and see your medical records, if you are incapacitated.

It could be that this plan is exactly in line with what you would have wanted; if so, you’re all set.  But if you haven’t taken the time to chat with a knowledgeable estate planning attorney, who can explain the ins and outs of that ‘default’ plan, how it will apply in your situation, and the available alternatives, you can’t make an informed decision about whether it is good enough for you and your loved ones.

“But I’m just a [fill in overworked, underpaid job or profession here].” “I don’t have anything.” “I just want my stuff to go to my wife/husband/kids.” “I already made a trust, everything’s taken care of.” “I don’t care what happens after I’m gone.”

I hear these explanations and excuses all the time. But once they start the planning process, and learn more about the ‘default plan’, people almost always realize that they DO care about the legacy they will be leaving behind, and that they DO want to take a few small steps to save their loved ones the stress and expense that can arise when no planning is done, regardless of how much or little property is involved.  Many folks find that they actually have more ‘stuff’ than they thought. People also usually discover that they have received some mis-information about the planning process, or the ‘default plan’, and that it is easier than they thought to ensure that their wishes are honored and the path is smoothed for those who have to ‘pick up the pieces’.

“But I’ve already done all that; I have a will, a trust, and all those other things.”

If you’ve done planning before, whether here in Hawaii or elsewhere, it’s even more important – to protect the investment you’ve already made, in money, time and effort – to have your documents and circumstances reviewed periodically. An out-of-date plan, or one that was drafted in another legal jurisdiction, under a different set of laws, can be worse than none at all.

It’s all too common for someone to make a will or set up a trust, then never look at it again as five, ten, or even twenty years pass. By the time they become incapacitated or die, the law has changed; children, and even grandchildren, have grown up, moved away, started families of their own, gotten divorced; businesses have been started, or sold; houses have appreciated or depreciated in value, or been sold or given away; people have moved; friends or relatives have died; investment and retirement accounts have grown, or dwindled. Any of these changes can affect how your plan will actually be implemented, when the time comes.

Think about all the things that have happened in your life in the past 10 years. Even if you are still living in the same place, own the same property, and have the same family situation, the law determining how your will or trust will be interpreted has changed dramatically (even over the past five years, there have been substantial, and unanticipated, changes in Federal law that affect almost every type of estate plan), and so has the body of knowledge and techniques available for protecting your assets, saving taxes, and easing the transition of wealth between generations.

Regardless of your situation, you owe it to yourself, and to your loved ones, to take just one small step: have a conversation with an experienced estate planner, to see if your plan (whether it is one you helped put together, or the one  the State has provided for you) will have the results you want, and if not, to learn about the alternatives.  The final decision is always up to YOU – but you can’t make a good one unless you have accurate, up-to-date information. Getting that information to you is what we do.

Published in: on June 20, 2010 at 2:46 am  Leave a Comment  

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