Granted, there are cheerier topics for the holiday dinner table than mortality and property distribution, but it is important that you discuss your estate plan with loved ones. This is the best time of year to bring up this topic since everyone is already together. You can avoid repeating discussions and assure everyone is on the same page.
Here are five tips on how to approach this discussion in a productive manner.
Prepare Documents First
It is much easier to be clear about your intentions and avoid dispute if you already drafted a will, trust or other estate planning documents. Start by explaining that you finished a will or trust and you have copies of the documents if anyone wishes to review them.
Not only should wills and trusts be complete, but also any advance directives and health care powers of attorney. Keep copies of those handy as well and let family know that your wishes concerning future health care in writing. This shows firm decision making and leaves little room for argument.
Do not hide the fact that you limited someone’s inheritance or excluded them all together. If your family is fraught with conflict, consider bringing in a third uninvolved party as a mediator when you share this information.
If the excluded loved one discovers this after you die, it allows them better grounds for a will contest. They may claim that was not your intention and even indicate that another relative exercised undue influence over you. However, if you communicate to them that this was your intention and have a witness there to confirm that, there is no doubt and few grounds to contest the will. This can make the probate process easier for everyone involved and maintain the value of your estate by reducing the chances of high attorney fees.
Consider Appointments Carefully
If your youngest child is extremely detail-oriented and has good math skills, it makes complete sense that you would choose him or her as your executor (personal representative) rather than the frequently forgetful older child. Never let birth order or false obligations choose executors, guardians or health care representatives. You want to choose the best person for the job. Keep in mind that may not always be a family member.
Inform those who will be appointed for various roles. Unlike disinherited parties, this often does not cause hurt feelings. Your sibling who already has children will likely embrace the role as guardian of your children more than the childless sibling who lives in a one-bedroom condominium. Also, your children will likely recognize which one of them is better skilled at managing your estate as an executor. The adult child who prefers making metal sculptures to filling out paperwork will actually be incredibly relieved that you did not choose him or her!
Even if there is a dispute over these roles, you control arguments by having these appointments made before you start discussions. That is why finishing your estate plan first is so crucial.
Conflict may be unavoidable but confrontation is not necessarily unavoidable. Treat this as an intimate discussion, not an argument. Explain your reasons for your decisions from the heart and avoid statements of judgment.
For example, if you reduce a family member’s share in a life insurance policy or business interest, explain it as, “The other beneficiary needs the cash to send a child to college,” not “You filed bankruptcy four times already and I know you will squander this money.” Keeping this positive reduces defense mechanisms and keeps this discussion positive.
Of course, you may have an adult child or other relative who will take offense no matter how you frame your reasons. The trick is to avoid the bait. If they look for a fight, simply state, “I expressed my intentions and they are not up for discussion.” Sometimes, the best you can do is make your plans known and understand that there will be hurt feelings no matter how you handle this.
Expect an Ongoing Discussion
You may not wish to bring this up at the first discussion but it is likely there will be updates in the future. Right now, you may have four adult children who are still single or in school. However, when you bring this up again in two years, there may be grandchildren or adult children who are doing much better financially than before–or one may face greater financial needs.
Just as you want to inform family of your first estate plan, also keep them in the loop when you update it. Avoiding surprises when you pass away is a good way to assure a better probate process and a reduced chance of a relative contesting a will or trust.
Prepare for this important discussion by completing the first step–the complete and appropriate Oregon estate plan FOR YOU. Call Gruber & Associates, P.C. today to schedule a consultation.
Most people do not need to avoid probate. They need the right tools to make it easier. The first step to that is drafting a will and informing loved ones of its location and contents.
Even then, the challenges are only beginning. In addition to managing the paperwork and legal formalities that follow a death, your loved ones are also facing their grief. This is an overwhelming time where even a simple telephone call to a life insurance company feels like a monumental task.
Efforts made now can make this easier for your friends and family in the future. Once you finish your will, complete these five tasks to assure a more efficient probate process for your loved ones.
Keep It All Together
Once you draft a will, keep the original in a safety deposit box, a copy with your attorney, and another copy with your executor, the person named in your will to manage your estate. Let other family members or close friends know you have a will and who has copies of it.
Wills do no favors if they are kept secret. If no one knows you have a will and/or cannot find it, then your loved ones will be forced to file an intestate probate in order to transfer your assets. An intestate probate is a probate without a will. It is more time-consuming and more expensive than a probate with a will. Moreover, this leaves your loved ones wondering what to do. A will expresses your wishes and directs your loved ones what you want to become of your assets after your death.
Keep other important documents near your will as well. These may include real estate papers, car titles, stock certificates, and life insurance policies. If all these documents are together in one place, life for your grieving executor just became easier.
Make Lists Now
One of the largest tasks in probate proceedings is the inventory. This is a list of all your assets and their values. The court uses it to determine the value of your estate and the distribution of your property.
Start keeping updated lists now to make this job easier for your grieving relatives. If you have a special collection of art, jewelry or other high-value items, keep track of these items in a spreadsheet or even a notebook. List values if you have them. Your executor may have to get some items appraised, but even just a list will make the inventory step easier for your executor.
If a loved one is a joint owner on a real estate deed or car title, tell them. This makes it easier for them to take possession of these items after you die and keeps the asset out of probate. The same is true for any life insurance policies. If beneficiaries know they are entitled to these funds, they may be able to collect them without the involvement of the court or your executor.
Likewise, if there are family members who are not receiving any of your property, be direct about this situation and who is affected. You may want to tell a trusted family member. Being clear about all your wishes, even those that work against family members, prevents problems after your death.
Organize Your Finances
Just as you own assets, you may also carry debt. Keep mortgage documents, credit card statements, and medical bills in an accessible place and maintain a current list. Then when you executor must send out notices to creditors, they do not have to engage in an exhaustive search to find them all.
Provide Attorney Contact Information
When you pass away and your family and friends grieve, your estate planning attorney can be a guiding voice of reason during a difficult time. It is much easier to complete a probate filing with the attorney who knows you and drafted your will then to start from scratch with a new attorney.
Your attorney’s name, address, telephone number, and email address should be in the margins of your will. Inform your family members who you hired to handle your estate planning. Even if your attorney moves from the area or retires, having that information can still help your loved ones find someone else to represent them in the probate proceeding.
Gruber & Associates, P.C. offers estate planning and probate guidance for Oregon residents. Not only can we design an estate plan that best reflects your wishes but we can make the probate process more efficient and effective for your family. Contact our office today to schedule an estate planning or probate consultation.
An advance directive is a complimentary service when you hire Gruber & Associates, P.C. in West Linn, OR for estate planning. Its scope is limited so it works best with other estate planning documents. While it definitely offers advantages and eases health care decision-making for your loved ones, an advance directive also has its limits. That emphasizes the need for a complete estate plan.
An advance directive indicates your health care preferences if you are unable to communicate them to your doctor. It appoints a health care representative who executes these decisions, including any preferences regarding life-sustaining medical treatment.
Apppoints an Advocate
While many people do not want to consider it, there is a possibility that you will suffer injury or illness substantial enough to leave you unable to communicate or make decisions. While healthcare providers use their best discretion, there is another possibility that their decisions will not match your preferences.
The healthcare representative acts as your voice when you cannot speak. Since most clients appoint someone in this capacity that is close to them, this individual understands your motivation and feels honor-bound to respect your wishes. Many clients choose a spouse, sibling or even a good friend to fulfill this role. If you have someone in your life you would prefer for this duty, it is a good idea to execute an advance directive.
Define Course of Health Care
Health care decisions may have religious inclinations, like Jehovah’s Witnesses and their avoidance of blood transfusions. Other times it is simply a preference for particular courses of treatment.
An advance directive allows specific instructions. You can designate specific doctors, health care facilities, and, if you are terminally ill, your choice for hospice care. There may be circumstances where you prefer to continue palliative treatment at home and avoid future hospital visits. If you have detailed preferences like this, you need an advance directive.
Limit Life-Sustaining Medical Procedures
The best-known feature of the advance directive is your decisions regarding life-sustaining medical procedures. Many clients execute one because they do not wish to be kept alive by machines. Others make different choices.
While an advance directive is sufficient for ensuring your wishes are granted, you may also sign Physician Orders for Life-Sustaining Treatment or POLST. This is an additional document provided by a doctor, clinic or hospital that remains in your file and removes any doubt of your decision. It is presented not only if you are terminally ill but sometimes before surgical procedures. Do not be surprised if one is presented to you if you are admitted to the hospital.
Advance directives define your course of health treatment but they have their limits. These are reassuring more than inconvenient, especially if you have a finished estate plan.
Indicate Burial Preferences
If you have any burial preferences, you should list them in your will. The advance directive is not an appropriate avenue for expressing this information.
Other options may include pre-planned funerals where you can confirm any religious or personal preferences. If you decide on something different, like donating your remains for study, that requires additional forms and an advance directive is not effective to assure that occurs. Many preferences require additional steps so discuss those first with your attorney before thinking one written note or document guarantees them.
Affect Insurance Coverage
There are concerns that insurance companies may require patients to sign an Advance Directive or face claim denial. This is not legal and any insurance company who insists on this should be reported to the Insurance Commission.
Signing an advance directive has no effect on insurance coverage or at least should have no effect on it. If you are not comfortable with executing an advance directive or feel pressured to do so, do not do it.
There are occasional concerns that the Oregon Death with Dignity Act may authorize health care representatives to choose euthanasia over further treatment, However, the law makes that impossible.
To be eligible for death with dignity, a patient must be a resident of Oregon who is 18 years of age or older. If they are diagnosed with a terminal illness where death is imminent within six months, they must also be capable of communicating their own healthcare decisions at the time they request death with dignity. An attending physician determines whether a patient meets these criteria–not a healthcare representative.
Since the patient must choose and self-administer the euthanasia drugs, physicians cannot be involved at all except to determine if the situation is appropriate for this option. Between the mental capacity requirement and the self-administration one, there is no way that a healthcare representative can authorize this course of action–or legally compel a physician to administer the drugs.
It can be difficult to consider these worst-case scenarios, but taking the time to do so offers reassurance and peace of mind. To start designing your estate plan and long-term care decisions, contact Gruber & Associates, P.C. today to schedule an appointment.
When you visit the office of Gruber & Associates, P.C. for your estate planning appointment, we frequently suggest other documents in addition to your will or trust. One of these includes a durable power of attorney. This document appoints an agent to handle your financial or business affairs if you are incapacitated or unavailable. It becomes invalid when you die.
This is a fairly simple document that does not add much to your estate planning expenses. When you need it, it is often a dire situation which makes this an essential part of long-term care and planning. If you do not have a power of attorney when you need one, it can make things difficult for you and your family members. Here are three possible horror scenarios if you do not have a valid power of attorney.
Unmanaged Insurance Claims
A power of attorney may go into effect immediately or if you become incapacitated. Since incapacitation often leads to filing a disability insurance claim, you may need an agent to handle that process for you.
However, an insurance company is not going to let just anyone file the forms, grant permission to access your medical records or make decisions during claim processing. Your spouse is not automatically granted this privilege since the law sees married people as unique individuals, not one unit. The only way for your spouse, sibling, business associate or good friend to help you through this process is with a power of attorney. When you appoint any of these people as an agent, they only need to provide the claims adjuster with the power of attorney and that grants them the authority to manage your claim.
Otherwise, appointing an agent to act on your behalf becomes expensive and complex. You will secure disability benefits quicker if you prepare just in case of incapacitation.
Limited Access to Assets
If you do not have a joint checking account with your spouse or you have business assets that are only in your name, your family will not have access to these income sources if you are incapacitated in a hospital bed. The only way your separate assets can be used for your benefit is if you execute a power of attorney.
This can be especially necessary if your incapacitation is for the long-term or you face an uncertain prognosis. The power of attorney may grant permission to a business partner to transfer income to your family or allow your spouse to access a business account.
This not only provides income but assures other functions are carried out too–like paying bills, filling out automatic deposit forms, and managing investments. If you are single, it is unlikely you have a joint owner on your accounts. Unless you want to return from incapacitation with a defaulted mortgage and past-due bills, you want to appoint someone to manage these affairs in case you are unable to do so yourself.
Poor Asset Management
Sometimes, it is a matter of finding the best person for the job. Powers of attorney also apply if you are leaving the country for a while and need someone to manage your property in the United States. Sometimes, that can end with a bad surprise when you return home.
For example, you may allow a spendthrift relative to stay in your home while you decide to live in Italy for the next five years. It may be difficult to trust this relative to pay the mortgage on time or keep utility bills current.
However, with a power of attorney, you can appoint a responsible manager for your home and its expenses. This individual can pay the mortgage and utilities from your account, and demand reimbursement each month from your temporary resident. If they fail to pay, your agent can start eviction procedures on your behalf by hiring an attorney and making decisions throughout the case. Your interests are protected better if you go this route rather than rely on someone who may not follow through.
There are also instances where clients trust their oldest child more than their spouse to make investment and financial decisions. Single people who live estranged from their families may desire that their live-in partner or best friend handle assets in case of absence or incapacitation. Just because an individual is a joint owner or physically present does not necessarily mean your best interests motivate them. You take better control of your situation with a power of attorney.
So when we recommend a power of attorney at your estate planning appointment, do not scoff. Perhaps the circumstances requiring one will never arise. But if they do, you want to make everything as easy as possible for you and your family. Plan for contingencies and make an appointment with Gruber & Associates today to create a solid estate plan.
Trusts are subject to misinformation in Oregon. Entire industries exist to scare people out of probate and create these large estate vehicles that are not always necessary. Most clients who fall for these sales pitches would save money by drafting a will and never creating the trust.
When used for the right reasons, a trust protects your family’s interests. If it is created solely to avoid probate, you will lose more money and time than you will save. Here is an overview of what a trust can and cannot do in Washington, Multnomah, Marion and Clackamas counties.