An estate plan consists of a series of decisions. These decisions include whom to name as your financial agents in the event of incapacity or death, whom to name as your health care agents in the event of your incapacity, who should receive your assets upon death, and whether and to what extent you should place conditions or restrictions on inheritance.
These decisions necessarily involve inclusion and exclusion: you will favor certain people at the expense of others. There is no duty to disclose these decisions to the parties involved in your estate plan, such as your named agents or your beneficiaries, until you pass away. Upon death, your closest family members and those who are named in your estate plan will learn of your decisions.
Your estate plan is often the final communication of your wishes. However, it is formal and often difficult to comprehend for those who are not estate planning experts. It is therefore often prudent to consider sharing at least the general concepts of your estate plan with your loved ones while you are still living.
I always offer my estate planning clients a “family meeting” at no additional charge to go over their estate plans with their agents and/or beneficiaries. I explain that although the completion of the estate plan provides the tools to administer an estate efficiently, knowing how to use the tools is just as important. I often explain the general concepts of the estate plan to the agents and beneficiaries and explain what they need to do in the event of incapacity or death.
Clients often take this opportunity to explain why certain people were chosen as financial or health care agents in a particular order so that nobody feels slighted in the selection process. In this way, they know what to expect and there are no surprises which goes a long way to ensure that there will not be disputes or misunderstandings when the estate is distributed.
If clients choose to exclude a natural heir – such as a child – from an estate plan, communication can be even more important. If they do not want to have the discussion while they are living, I often recommend that they at least write a letter to the excluded person that explains the thinking and serves as an olive branch for the unfortunate circumstances that led to the exclusion. It is remarkable how this one extra step can avoid a tremendous amount of aggravation and even litigation.
Surprises in estate planning seldom lead to positive results. Although you have no obligation to share any of the details of your estate plan with your loved ones or to offer any explanations for your decisions, it is definitely worth considering being open to an extent about your estate plan to ensure a smooth procedure.
KRASA LAW, Inc. is located at 704-D Forest Avenue, Pacific Grove, California and Kyle may be reached at 831-920-0205.
Disclaimer: This article is for general information only. Reading this article does not establish an attorney/client relationship. Before acting on any of the information presented in this article, you should consult a competent attorney who is licensed to practice law in your community.