Everyone should have an estate plan in place! Whether you are young, old, or somewhere in between, estate planning should not be something you put off or overlook.
Once an individual has reached the age of majority — age 18 in all but two states — their parents no longer have the authority to act on their behalf. While they may not yet have much in the way of assets, they may need assistance with health care decision-making if they are ill or in an accident. They would likely want their parents to be able to make decisions for them, but without a health care or financial power of attorney in place, the parents have no legal authority to do so. Lacking legal authority, the parents will need to file a guardianship or conservator action with the court at a great deal of expense and hassle.
The same issues apply throughout our lives. We never know when severe illness or an accident will make us unable to handle our own affairs. Planning ahead is the only way to avoid a huge mess for our loved ones if it happens.
What about dealing with our assets upon our death? Failing to plan always results in problems for your family later. I have seen individuals who were wonderful people have their legacies erased because of the mess they left their family after they died. All the wonderful memories are erased by the pain and frustration the family felt as they fought through the estate administration disaster created by a lack of preparation.
There is nothing more depressing than seeing a surviving spouse who had a wonderful life with their spouse for 60 years, and all they can think of now is how angry they are as a result of the chaos they were left to deal with.
If you have done some estate planning, remember that it is a process, not an event. If your plan is going to work effectively, it must be updated and maintained regularly. An outdated plan that is no longer applicable to your situation can be just as detrimental to your family as no plan at all.
You should have a thorough review and update of your plan at least every three years. You would not ask a financial adviser to invest your assets, and not check back with him or her for 20 years to see if any adjustments are needed. That would be ludicrous.
However, a recent study showed the average person updates their estate plan every 19.6 years. It is naïve to think that a document drafted 20 years ago to address everything you own will serve your family’s needs at what will likely be the most traumatic and emotionally draining time in their entire lives.
Our families deserve better! Everyone should have an estate plan, and they should be involved in a formal process to regularly update that plan to make sure it is working well when it is needed. You never know what the future holds (just look at 2020), so let’s be prepared to save our families from turmoil and strife when this sad event occurs. Then our legacies will have a chance to survive us and serve the next generation.Dolan, an attorney, helps farm and ranch families achieve comprehensive estate, succession and legacy planning objectives. He is the principal of Dolan & Associates P.C. in Brighton and Westminster, Colo. Learn more at estateplansthatwork.com