I speak with many Tennessee families every day, and a common statement that I hear is the following:
“I Don’t Need This Right Now”
“I’m Not Old Enough to Start Talking about Estate Planning”
“Estate Planning is Really Just for the Elderly and Not For Us”
From an estate planning attorney, this can be the most expensive and the most foolish thing that a person could say when it comes to their own family. None of us know when we are going to die, and if we did, this discussion would be much easier. However, the fact remains that none of us know what tomorrow will bring and all of us will one day have to die.
Let me tell you the story of James and Ashley, brother and sister, regarding their aging father. Their father, John, was 85 years-old and his mind was not as good as it once was. James and Ashley knew from talking to their father over the recent weeks that something wasn’t right. James and Ashley took their father to the doctor and it turned out that John had Alzheimer’s. Many, many years ago, John had a will written leaving everything to his wife, and if she should predecease him (which she did), then everything to his two children equally. In addition, John had named his wife as the Transfer-on-Death (TOD) beneficiary on his bank accounts, his investment accounts at Edward Jones, and his IRA. Unfortunately, since his wife’s death, John did not make any changes to his will and made no changes to his financial accounts to have the TOD beneficiaries updated. James and Ashley were forced to make arrangements to have their father admitted to a nursing home facility due to his Alzheimer’s. In addition, James and Ashley took their father to see an estate planning attorney regarding this will and financial accounts. Unfortunately, there was nothing that could be done. John was not competent to make amendments to his will. In addition, because he was not competent he was not able to change the TOD beneficiaries on his financial accounts. John was now in a situation where he could make no changes, and when he dies, James and Ashley will have to go through the probate court system, all the financial accounts will be frozen at his death, and they will have to wait many months or even years before their father’s assets will be distributed to them in accordance with his last will.
The story I just told you is all too common. A family thinks all they need to do is write a last will and testament and name beneficiaries on their financial accounts and everything will be simple for the surviving family. However, that is frequently not the case. The TOD beneficiary passes away, the family forgets to name a new beneficiary, the family member passes away, and then the surviving family is left with a long and drawn out probate court proceeding where all the bank accounts and financial accounts are frozen, and the surviving family members can’t even access the accounts to pay for the funeral expenses.
This is why estate planning is so imperative. It needs to be completed early and needs to be continually updated so that you never have a situation similar to John and his children. One way to accomplish this is with a revocable living trust. A revocable living trust not only provides an avenue to distribute your assets at death outside of the probate court system, but it also provides for your trustee to make decisions on your behalf in the event of your incapacity. In addition to a revocable living trust, by executing a durable power of attorney and a healthcare power of attorney you will have further protection from the story we shared above happening to you.
The purpose of estate planning is to reduce this risk of a stressful public court proceeding for your children.
You can avoid the probate nightmare from happening to your family by implementing a simple estate plan so that the risk of frozen assets and a public court proceedings is eliminated for your children and surviving family. If you have questions on how to plan your estate so that this risk is eliminated for your family, then please contact our office for a complimentary visit so that we can discuss your estate planning needs and concerns in further detail.
We look forward to hearing from you!