Two new clients came to see me last week. They needed changes to an old estate plan. They weren’t in my office because they wanted to be. They were there because someone they trusted told them to come. In that respect, they aren’t alone. Most people make estate plans because someone else died or someone else told them to.
The state of Maryland passed some significant estate planning legislation in the last legislative session that will change the compass once again on what an individual may have as specific goals for their estate plan. You would have thought those changes would be driving people into our office in droves. But not really.
We will talk about those specific changes and their impacts in this space in the near future. For the moment, however, I thought we ought to back up and start is a generic discussion of estate planning.
The true goals of estate planning are different for everybody. Some people enjoy living frugally to leave assets to loved ones. Others hope to spend that last dollar on an exotic vacation and die while laughing on the flight home about the hot check they wrote the bartender. Some want to leave their entire estate outright to their children. Others want to strictly control distribution to their beneficiaries. Some intend to leave their estate to charity.
Because estate planning is overused, it is important to come up with an understandable definition. Basically, your estate consists of assets you accumulated during your lifetime. This means real estate, bank and brokerage accounts, retirement plans, life insurance, other investments, and even your junk. Everything you own and value that can be passed on is your estate. Planning for your estate is best done while you are still alive and well because the purpose of planning is for the time when we are either no longer alive or no longer well. Thus, good estate planning should cover three potential time frames: the present, disability, and death.
Planning for the present consists of coming up with a plan that does not unduly complicate your life as well as one that enables you to stay in control of your estate as long as possible. You also need a plan that remains as flexible and changeable as possible in order to adapt to constantly changing rules, statutes, and laws. Planning for disability usually comes next. Although none of us wish to become incapacitated, the reality is that surveys suggest close to half of all seniors will become disabled at some point in their lives. Do you know who will take care of you, your spouse, and others who may be dependent on you if that should occur? Lastly, you plan for when you’re gone. This time frame is where most of us focus when considering our estate planning. Again, everyone’s goals will be different for post-death planning.
Many well-respected attorneys battle the myth that the only purpose of estate planning is to avoid probate and save on taxes at death. While both of these goals are important, they are but a small part of our true purpose for post-death estate planning. For some people, the primary goal is to pass on a family business or farm to a child who is active in the business, yet try to equalize assets going to another child. Others want to ensure inheritances going to family members are protected as much as possible from divorcing spouses, crazy in-laws, creditors, lawsuits, illness, or bankruptcy and also want to protect heirs who may be too young or too immature from their own bad spending habits, possible addictions, and bad influences. Getting advice from a qualified estate planning attorney can offer may options with which to achieve these goals.
With the proper tools and advice you can accomplish almost any estate planning goal you have in mind. I tell my clients regularly “if you can describe it, I can write it.” The basic element here is to find out what you want and then make it happen. It isn’t about me pulling something off my shelf and saying “here, this will fit you nicely.” These plans are meant to be tailored to the individual.
When you are working with an attorney on your estate plan, it is as critical that they are listening as it is that you are open an honest. There are a lot of great lawyers that can help you with these decisions. If you live near us, give us a call. We would love a chance to work with you. If you don’t live near us, give us a call anyway and we will route you to some very good people.
Until then, good luck and good hunting.
The Fisher Law Office is known for its experience in estate planning, probate administration, asset protection, and business development. Annapolis attorney Randall D. Fisher has practiced for over 20 years, maintains the highest peer review rating for ethics (AV Preeminent) by Martindale-Hubbell, and is a sucker for long walks on the fairways.