A good estate plan covers contingencies, takes control of the future, and involves clear communication. This post is the final in a three-part series that discusses these three “c”s of estate planning.
Recently there was a report about a father who had a one million dollar life insurance policy. When he had a massive stroke, his children made arrangements for his care. Because they had no idea about the policy, the premiums went unpaid. When the children discovered the policy after his death, it was too late. The father could have communicated his plans to his children. Sometimes the simple things are the most important things.
Communication by organization
If you have one place to keep important documents like your will or trust, keep insurance policy statements, and an inventory of your other assets in the same place. Update this inventory regularly. Make sure that your trustee or executor knows where to look for these documents. If you have a power of attorney (and you should) make sure your bank and other financial institutions have a copy.
Communicate with your beneficiaries
Sometimes family issues make estate planning difficult. If you don’t feel comfortable discussing your decisions with all of your children or beneficiaries, discuss them with the person you’ve selected as your trustee. You can even write a letter or even record a video to be revealed with your estate planning documents to give an explanation. If you are faced with making a difficult decision in your estate plan, the better you can communicate that decision ahead of time reduces the chances of litigation down the road.
Communicate with your attorney
Your relationship with your attorney is critical in creating your estate plan. Your ability to clearly explain your desires and wishes will enable your attorney to fit your will or trust provisions to your intent. Talk about your long terms plans. You might be surprised at what terms can be tailored for your needs. The one constant in life is change; will you be able to easily go back and adjust your plan if necessary? Do you know what will have to change in your plan if you have a change in family status or change in assets?
Clear communication solves many problems. Make sure that your estate plan is the product of clarity.