The Good, Bad and Ugly of Joint Ownership

Joint Ownership: The Good, The Bad, and The Ugly

When I think about joint ownership, my mind drifts back to the dusty streets, wide-brimmed hats, and gritty showdowns of the classic spaghetti Western The Good, the Bad, and the Ugly. Much like the stark choices facing our favorite gunslingers—choices that shape destinies in ways both noble and disastrous—joint ownership comes with its own set of promises and pitfalls. It’s simple, sure, but as with every quick draw in the Old West, the outcome isn’t always what you expect.

Let’s saddle up and take a ride through the good, the bad, and the downright ugly of joint ownership in estate planning.

The Good: Quick, Easy, and No Probate

At first glance, joint ownership seems like the hero in a white hat. It’s the sheriff riding into town, offering simplicity and immediate benefits. There’s no denying that joint ownership can be a powerful tool in the right circumstances.

For starters, it’s incredibly easy to set up. Walk into your bank or meet with a title officer, sign a document, and voilà—you and your partner, child, or friend are now joint owners of the bank account, house, or investment. This ease is especially attractive when it comes to avoiding probate. Upon the death of one owner, the asset automatically transfers to the surviving owner without the need for probate proceedings.

Like the classic Hero of the iconic story (the “Good”), joint ownership can be smooth, efficient, and reliable. It keeps things moving without the complications of court. In fact, for many families, it’s a no-brainer for things like bank accounts or vehicles—quick, cost-effective, and free of legal entanglements.

But beware. As any seasoned lawman will tell you, things aren’t always what they seem in the Wild West—or in estate planning.

The Bad: Unintended Consequences Lurking in the Shadows

Remember the “Bad”? He wasn’t all bad—he had his moments of charm—but there was always a sense of trouble waiting just around the corner. Joint ownership carries similar hidden dangers, lurking just beneath its easy façade.

One of the biggest issues with joint ownership is the lack of control after the arrangement is made. Once an asset is placed in joint ownership, both parties have full control. This means that a joint owner can make decisions about the asset without the other party’s consent. That simple, shared bank account? If your co-owner decides to empty it out for a lavish vacation in Cabo, there’s nothing stopping them.

Even more treacherous are the unintended consequences upon death. Joint ownership often disrupts the best-laid estate plans. Picture this: you’ve carefully drafted your will, ensuring that your estate is divided equally among your three children. But then you add one of your children as a joint owner on your home for convenience, or to “save them trouble.” Upon your passing, that child inherits the entire house, bypassing your will entirely, leaving the other two children out in the cold. Talk about a showdown.

The bad doesn’t end there. Joint ownership can also lead to complications if one of the owners faces legal trouble. Suppose your joint owner is sued or goes through a divorce. Suddenly, the asset that seemed secure and untouchable is now subject to the claims of creditors or ex-spouses. It’s like finding out dynamite isn’t just for blasting open safes—it’s about to blow up your entire plan.

The Ugly: When It All Goes Wrong

We can’t talk about joint ownership without referencing Angel Eyes, the “Ugly” of the story—the ruthless, calculating villain who plays both sides and leaves destruction in his wake. The ugly side of joint ownership isn’t just about minor complications; it’s about things going catastrophically wrong. When joint ownership turns ugly, it can dismantle families, strain relationships, and leave estate plans in shambles.

One of the ugliest scenarios involves incapacitation. If one joint owner becomes mentally incapacitated, the other owner may find themselves in a legal bind. Without a proper power of attorney in place, accessing or managing the jointly owned assets can become a nightmare. Court involvement might be necessary, dragging out the process and creating stress for everyone involved.

Things can also get ugly when more than two people are involved. Let’s say you’ve named all three of your children as joint owners of your vacation home. While they may all get along now, what happens if one decides they no longer want the responsibility of upkeep or if they disagree on whether to sell? A simple setup can lead to bitter disputes, with family members squaring off like a final showdown in the desert—except this time, it’s not about gold, but family relationships and inheritance.

Then there’s the ultimate ugly scenario—unexpected death. Imagine this: you’ve placed your spouse as a joint owner on your home, thinking it will make everything simpler. Then, tragically, you both pass away in a car accident. Who inherits the house now? Without proper estate planning, it could end up in probate, creating the very headache you were trying to avoid.

The Illusion of Simplicity

The lesson here, like in any classic Western, is that things aren’t always as simple as they appear. Joint ownership can seem like the fast draw, the easy solution to avoid probate and streamline your estate. But just like in the showdown between the three combatants, the situation can quickly spiral out of control, and you may find yourself facing unintended consequences.

Sure, joint ownership has its benefits. For small assets, like a bank account or a car, it can be the quick-fix hero. But for larger, more valuable assets—like your home or investments—it often pays to take a step back, holster your gun, and consider the broader implications.

The Alternative: A Trust

If you’re looking to avoid probate but want to avoid the shootouts that joint ownership can sometimes create, a trust may be your best option. Unlike joint ownership, where control is shared, a trust allows you to maintain complete control over your assets while you’re alive, and dictate exactly how they are to be distributed upon your death. No chance of a co-owner running off with the loot—or leaving it vulnerable to their creditors.

Trusts also allow you to plan for incapacitation. Should you become unable to manage your affairs, a trustee steps in to handle things according to your wishes—no need for court involvement. It’s the difference between planning for every eventuality, like Blondie with his wits and strategy, versus relying on luck or a quick draw.

Wrapping It Up: The Final Showdown

Just like the iconic Western showdown in The Good, the Bad, and the Ugly, joint ownership in estate planning comes with a mix of promise, peril, and potential disaster. It’s easy to set up, avoids probate, and can be a useful tool for small, uncomplicated assets. But as with every good Western, the situation is never as simple as it first appears. Unintended consequences, legal entanglements, and family disputes can all come roaring into town, transforming what seemed like a simple solution into a complex and ugly problem.

In estate planning, it’s always best to weigh your options carefully and consider the long-term consequences. As our hero might say, “When you have to shoot, shoot—don’t talk.” In other words, don’t rush into joint ownership without considering the full picture. Take the time to plan properly, and you’ll avoid the misfires that can come from too-simple solutions.

Closing Thoughts: Riding Off into the Sunset

At the end of the day, joint ownership is neither entirely good, bad, nor ugly—it’s simply a tool. Like any tool, it can be used for good or lead to unintended consequences, depending on how it’s handled. The real trick is in understanding its limitations and knowing when to bring in a more sophisticated strategy, like a trust.

So, before you sign on the dotted line, take a moment to pause. Consider your entire estate plan, not just the quick wins. Because in this arena, the last thing you want is to end up like Angel Eyes—on the losing end of the final showdown.

In the world of estate planning, we might not be cowboys, but we do know one thing: it pays to plan ahead and avoid unnecessary showdowns. Make sure your assets are in the right hands, and you’ll be riding off into the sunset with your estate in good order, leaving behind peace, not chaos.

Also, we can serve as experienced guides in finding the right path.

The Seasons of Life

Aging in an Instant

In the Book of Ecclesiastes (3:1-8), God tells us that there is a season for everything: a time to be born, a time to die, a time to plant, a time to pluck up what is planted. We are also sometimes reminded—though it was tragically left out—that there is a time to realize you’ve aged about 20 years in a single moment.

There’s no better way to start this tale than with weddings—an event that once filled our weekends with joy, dancing, and a hint of mischief. My wife and I attended many weddings in our day, dressed in our finest, basking in the glow of young love, and feeling pretty spry ourselves. But then, as if some cosmic wedding planner took pity on us, we experienced a warm, dry spell. The wedding invitations stopped coming. It was like we had been granted a reprieve from the mandatory tuxedo-wearing, speech-listening, and chicken-or-fish choosing that had once dominated our social calendar.

But, as seasons do, this one changed. After years of blissful quiet, we were suddenly invited to a wedding. Excitedly, we accepted, dusted off our finest attire, and prepared for what we assumed would be another youthful affair. But as I sat there, looking at the happy couple, something hit me like many wedding favors—this wasn’t the wedding of a friend’s child. No, this was the wedding of the friends themselves. The realization washed over me like a cold sweat: our friends were getting remarried or married for the first time, and we had, somewhere along the way, crossed the Rubicon from “young whippersnapper” to “seasoned veteran.”

It was as if someone had turned a page in the calendar of life, and suddenly, we were in the season of second weddings, third marriages, and blended families. We had aged in an instant, right there in that pew. And from that moment on, it wasn’t just the weddings of our friends’ children we were attending—we were now going to war for our friends themselves, rallying around them in their new marital adventures with a vigor that belied our advancing years.

Get a Real Doctor

But if that wasn’t enough of a wake-up call, the true shock came on an inevitable day, but no less surprising: the first time I went to the hospital as a patient. Now, I’ve been to hospitals before—cheering up sick friends, welcoming new babies, or visiting the occasional grandparent. But this time was different. I was the one on the gurney, and when the doctors arrived, I nearly sat up and demanded to see their IDs. They all looked like they were moonlighting from their high school drama club, dressed up as doctors for a Halloween party.

One doctor in particular caught my eye, and I swear, he couldn’t have been a day over 12. I half expected him to pull out a skateboard and zip down the hallway, perhaps making a pit stop at the vending machine for a bag of gummy worms. “Who’s this Doogie Howser wannabe?” I muttered to myself. “Can someone please send in a real doctor?” But then it hit me like the cold gel of an ultrasound probe: this was the real doctor, and I was now officially older than every single person tasked with keeping me alive. I’d aged yet again, right there on the operating table.

As we journey through the seasons of life, these jarring, often hilarious, sometimes sobering moments—remind us that time is indeed passing, even if we don’t feel it day to day. One minute we’re attending weddings of our friends’ children, the next we’re watching our friends take their second trips down the aisle. One day, we’re the young ones in the room, and the next, we’re wondering if our doctors have a curfew.

But there’s a certain beauty in it all, a rhythm that makes each season of life worth experiencing, even if it does come with a few gray hairs and the occasional existential crisis. For everything, there is a season, and the season we find ourselves in now is one of acceptance, reflection, and, perhaps, a little bit of humor—because if we can’t laugh at how quickly we’ve aged, we might cry instead.

These changing seasons and the passage of time also make your estate planning out of date. If your estate plan is a vehicle, you won’t use the same vehicle to transport yourselves as a newlywed couple as you do when you are carting around the soccer team; you’re driving off into your retirement years.

If you haven’t reviewed your planning in a while, it might be a good time to revisit your decisions, reconsider your relationships, and invest some time in reorienting your priorities.

Why an Estate Plan Needs Both Wills and Trusts

Why an Estate Plan Needs Both Wills and Trusts

Two of the best-known estate planning documents are wills and trusts. However, there is confusion about which is “best.” These documents serve different purposes; the important thing is to be sure that they work together to achieve the overall goals of the estate plan.

What is a Will Used For?

Most people understand a last will and testament is used to distribute a decedent’s assets after death. However, the last will serves several other functions. It names an executor, the person in charge of managing the estate. This is a significant role, requiring the ability to handle finances, engage with many government agencies (Social Security, IRS, Veterans Administration, etc.), navigate family dynamics and distribute estate assets.

If there is no will, the court will name an executor, known in that context as an administrator, who may not be a family member. Assets are then distributed according to the state’s laws, instead of as the decedent intended.

For parents with minor children, the last will nominates a guardian to raise minor children in the event of both parent’s death. If there is no last will, or if the last will fails to name a guardian, the court will decide who should raise the child or children. In many cases, the family may not have an opportunity to be involved in these decisions.

After the individual’s death, the will is submitted to the court in a process known as probate. This is a legal proceeding where the last will is validated, and the court approves the executor. If the last will has not been prepared according to the laws of the state where the decedent lived, it may be ruled invalid, and then the court proceeds as if there was no last will.

How Does a Trust Work?

Unlike last wills, trusts do not go through the probate process, which is one of their many advantages. The trust owns assets titled in the trust name, and such assets are not part of the estate subject to probate. The language of the trust is used to direct the person who manages the trust—the trustee—to do exactly what the grantor—the person who establishes the estate—wants with the assets owned by the trust.

Trusts can be used to distribute funds to beneficiaries based on achieving certain life milestones, like graduating from college or buying a home. Trusts are also used to reward certain behaviors, like maintaining sobriety or being employed for a certain length of time. Trusts may not impose illegal restrictions on beneficiaries. However, they can be used to encourage productive lifestyles. Spendthrift trusts are designed to limit the amount of assets for beneficiaries likely to use their inheritance unwisely.

Trusts are also used in blended families to ensure that biological children are not unwittingly disinherited. There are trusts to provide support for a second spouse, for instance, where the balance of the assets in the trust is distributed to the biological children after the first parent dies.

Wills and trusts are ideally created to complement each other, passing wealth onto the next generation, minimizing tax liabilities, avoiding delays in asset distribution and ensuring that the decedent’s wishes are followed.

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Estate Planning and Divorce

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Estate Planning and Divorce

In my prior life, I was a divorce lawyer for twelve years. I did a variety of different cases, but mostly divorce. I switched entirely to Estate Planning in 1995 and have never looked back on that decision. Much better from the lawyer’s side of the table.

Those years gave me a strong appreciation for the difficulties of strains on relationships. It also benefits many of my clients for their own plans, but much more often to protect their children going through marital problems.

Estate planning is very important to address both during and after a divorce. Divorces typically take several years to be finalized. Consequently, waiting to update every part of your estate plan until a divorce is completed can lead to unintended consequences. Spouses still have legal rights while a divorce is in process. Therefore, it is wise to take steps during this time to create legal and financial distance between you and your soon-to-be ex-spouse.

Laws regarding wills and certain retirement plans, such as pensions and some 401(k) plans, vary from state to state. These require due diligence before changes may be made.

Health Care Proxy, Living Will, and HIPAA Release Forms

Once divorce proceedings are underway; new documents should be created naming a new agent under your health care proxy, living will, any other advance directives, and HIPAA release form. You may choose a trusted friend, sibling, or other person to take control of your healthcare decisions in the event of an emergency or incapacity. The last person you want to make healthcare or end-of-life decisions is your future ex, even in an amicable divorce.

Update Your Power of Attorney

The same steps must be taken for power of attorney forms. Start by revoking any prior power of attorney documents and creating a new one, naming a primary and secondary agent to act on your behalf. A power of attorney will only be effective for assets directly titled in your name alone. However, it is necessary to protect these assets. Depending on your state laws, you may need to provide formal notification to your ex of this change.

Changing Beneficiary Designations

Certain states do not permit spouses to be removed from beneficiary designations for pension plans or some retirement accounts until a divorce is finalized. Make a comprehensive list

of all accounts with beneficiary designations and make the beneficiary changes wherever

possible.

If your estate includes a trust, the trust document needs to be reviewed. Is your ex a beneficiary? If so, this should be changed immediately. If you were generous with members of your ex’s family, you may also want to remove them as beneficiaries.

If you have minor children and the goal of the trust is to provide for them, is your ex named as trustee? If yes, you may want to remove your ex from the role of trustee and name a sibling, close friend, or perhaps a professional to serve as trustee.

Revising Your Will

Laws regarding ex-spouses and wills are state-specific. However, the best option is always to start with a completely new will. In some states, failing to update a will after a divorce leads to wills being declared invalid, and the estate is treated as if there was no will. Assets are distributed according to the laws of intestacy.

Most importantly, if your spouse is listed as an executor, revoke the will and name a new primary and a new secondary executor.

Your will is used to name guardians for minor children. Your ex will most likely be named guardian if you should die. However, if you have questions about their ability to be a safe and effective parent or are concerned about their choice of future partners, you can nominate an alternate guardian in your new will.

General Concerns

Divorce can be a stressful process, and adding more tasks may seem onerous. However, these estate planning steps are extremely important. In the long run, getting them done may help avoid unpleasant, larger problems for you and your loved ones.

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Guardianship Duties for An Incapacitated Adult

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Guardianship Duties for An Incapacitated Adult

When an adult becomes incapacitated, and no advance planning has been done, someone needs to become a guardian to care for the incapacitated person. That individual is then known as the “ward.” This requires a court proceeding to decide who should become the guardian. In Maryland, the process included the appointment of an attorney for the alleged disabled person, paid for by the family, and often a jury trial. When this happens, the incapacitated person loses many of their fundamental rights, including the right to vote.

Guardianship procedures are more costly than creating a comprehensive estate plan, which includes planning for incapacity.

How does a guardian handle the ward’s finances?

The guardian is required to act as the ward’s fiduciary, putting the ward’s interests before their own. The guardian must keep meticulous records and be able to account for every dollar spent. In most cases, the guardian reports to the court annually. The guardian’s finances must be kept separate from the ward’s accounts. No funds from the ward’s accounts or any trusts created for the ward should ever find their way into the guardian’s account (known as “commingling”), even if it would be far more efficient for cash management.

The guardian may also be responsible for applying for government benefits on behalf of the ward, overseeing the sale of the ward’s home, and managing the ward’s investments. If the guardian is only responsible for finances, they are often known as a “conservator” to distinguish this more limited role.

Does a guardian get involved in day-to-day living arrangements?

In most cases, the guardian is also responsible for the person’s care, including housing and daily living. Accordingly, the guardian’s responsible for ensuring the ward has a safe and clean place to live and receives any care needed. This may be at the ward’s home with a caretaker, at the guardian’s home, or in an assisted living or full-care facility. The guardian is expected to be actively involved in the ward’s life while overseeing the ward’s general well-being.

What kind of health care decisions is the guardian responsible for?

Healthcare decisions are also the guardian’s responsibility. The guardian is charged with making medical decisions in the ward’s best interest and, to the best of their ability, to make decisions just as the ward would have if the ward were able to do so. The guardian speaks with the ward’s health care providers and works with them to make sure that the ward gets any needed care. If possible, the guardian should honor the preferences and consult with the ward.

Am I responsible for the ward’s expenses?

The guardian is responsible for managing the finances of their ward. However, they are not expected to use their own financial resources for their ward. Nevertheless, a guardian may be held responsible if assets are available and the guardian is not keeping bills current. The guardian needs to disclose the legal status consistently to avoid potential personal liabilities for expenses. Simple errors or oversights may be treated severely by the court. Therefore, detailed records and attention to due dates are very important for the guardian.

Generally speaking, if you act in good faith, with diligence and care, the guardianship should not be an overly burdensome responsibility. In an ideal situation, even if one person in the family is the legal guardian, other family members are involved in their loved one’s life to ensure the best possible quality of life.

It is much better to make plans to handle disability without court involvement. Talk to an estate planning attorney to get that process protected.

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Estate Planning Considerations for Women

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Estate Planning Considerations for Women

Women face particular challenges in estate planning, which do not always present themselves until after a spouse has died or when a divorce occurs.

Statistically, women live longer than men. Therefore, it is essential for them to have a complete understanding of the couple’s estate plan and finances. There will be a greater chance they will need assets to last for a more extended period of time than for their husbands, in addition to planning for incapacity.

Overcoming Traditional Financial Roles Through Estate Planning

One spouse often takes care of finances, leaving the other with no knowledge of how assets are managed or how to access accounts. Upon the death of the first spouse, the surviving spouse is left to identify accounts, untangle how payments are made, etc. Addressing this information gap so both spouses are familiar with all assets and liabilities leads to better estate planning and avoids additional stress after the first spouse dies.

Women in second marriages may be more at risk for financial hardship if the estate plan has not been updated since their spouse’s prior marriage. If beneficiaries on a will, insurance policy, or retirement accounts have not been updated, the prior spouse could inherit the lion’s share of the current spouse’s estate. All estate planning and financial documents should be updated.

The task of raising children or caring for elderly parents continues to fall on women more than men. This results in lower lifetime earnings, which leads to smaller Social Security benefits. Married women who expect to claim their spouse’s Social Security benefits should educate themselves about survivor benefit claims. If a woman has been divorced after a marriage lasting at least ten years and has not remarried, she may claim benefits based on her ex-spouse, regardless of whether her ex has remarried.

Planning for Life is Part of Your Estate Plan

After devoting decades to raising children and caring for elderly parents, women are apt to brush off concerns about aging. Single, divorced, or widowed women, with or without children, need to have an estate plan to protect them during their lifetime.

A general durable power of attorney is needed to name an agent (also known as an attorney, in fact) to act if a single woman cannot manage her financial affairs because of illness or injury. Similarly, an advance healthcare directive, which includes a durable power of attorney for healthcare decisions, names a trusted person to make healthcare decisions in the event of incapacity. Married couples also need these documents. However, they are even more critical for a single woman, so family or friends may step in when needed.

Last Will and Testament

The last will and testament is used to distribute assets, including real estate, financial accounts and personal possessions. It is also used to name an executor. This person will be in charge of managing the estate: gathering assets, paying creditors, filing with the probate court, filing final personal income tax returns, paying estate taxes (state and federal), and at the appropriate time, distributing assets as per the directions in the last will. Make sure that the person you wish to serve as your executor can carry out these tasks. A spouse, adult child, niece, nephew, or trusted friend may be your executor.

Estate Planning for Women at Any Age or Stage

Whether business owners, homemakers, stay-at-home moms, or dedicated caregivers, women need estate planning to protect themselves, their loved ones, and their futures. An estate plan is one of many ways to accomplish this.

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Finding Fiduciaries

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Finding Fiduciaries

Selecting fiduciaries becomes easier when the role is understood. A fiduciary is a person empowered to control different types of assets for another person, usually the intended beneficiary of the assets. The fiduciary must put the fiduciaries own interests aside and act in the best interest of the beneficiary, even when doing so is contrary to the fiduciary’s own interests.

Who Can Be a Fiduciary?

A fiduciary can be any person who has legal capacity, including family members. If you are not comfortable with a relative controlling your assets as a fiduciary, then you may prefer to have a non-family member or even a financial institution serve in that role. For example, an

estate planning attorney is a fiduciary by the nature of the legal and ethical role to act in the best interest of his or her clients, but an attorney also may serve as a fiduciary for an estate, a person, or a trust.

The fiduciary appointed to administer a trust and manage its assets is known as a trustee. If the trust is created under your last will and testament to administer the inheritance for your beneficiaries, then such trust is known as a “testamentary” trust. On the other hand, if the trust is created under your revocable trust established during your lifetime, then the inheritance trusts come into play upon your death. Both of these inheritance trusts are irrevocable, the difference is that the “testamentary” trust requires probate and the other does not.

The fiduciary nominated by you to carry out the probate and administration of your last will and testament is known as an executor (or personal representative). The executor must first receive permission from the court to carry out the executor’s responsibilities. This happens only after the last will has been presented for probate and the court has validated the last will and approved the executor’s appointment.

How Do I Select the Best Candidate to Be My Fiduciary?

Selecting a fiduciary to take care of your financial and legal decisions in the event of incapacity or death can be more difficult than deciding who you want to inherit your estate. If your family includes multiple marriages or there are long-standing conflicts among siblings, an impartial professional or institution may be a better choice.

We spend considerable time in many consultation meetings weighing out the pros and cons of alternative choices.

Selecting a fiduciary from an online platform is not recommended, but researching candidates online does make sense. Fiduciaries do not all have the same professional credentials. Conduct your own due diligence and comparison shop. Ask for fee schedules and an explanation of the decision-making process. With a nonfamily member fiduciary, drafting in the document a mechanism for removing without litigation, such as a trust protector, allows for checks and balances.

A recommendation from a trusted legal or financial professional, supported by research into the background of the potential fiduciary and a conversation that includes the question “Are you a fiduciary?” is how most people find their fiduciary.

What Should I Consider When Picking a Fiduciary?

Trust. Do you trust this person or institution to make decisions for you and to carry out your instructions, even if it is not the same decision that person or institution would choose?

Skilled with asset management. A fiduciary must have a wide skillset in managing investments, real property, and personal possessions. They need to be able to handle detailed transactions from beginning to end.

Able to work with your heirs. The fiduciary needs to be able to balance a good working relationship and deal with challenges, including personality clashes. Not all heirs appreciate having an outsider manage their inheritance.

Closing Thoughts

When choosing a fiduciary, it is important not to be swayed by personality or personal relationships. This is a business decision and one that needs to be made solely based on the evidence of competency and trust.

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When Should an Estate Plan Be Reviewed?

When Should an Estate Plan Be Reviewed?

Like a car, home, or garden, estate plans require ongoing care. Estate plans reflect the wishes and goals at a particular time in a person’s life. For example, when drafting a last will and testament during a person’s 30s or 40s, two key goals are protecting minor children by naming a guardian and ensuring the surviving spouse’s legal and financial protection if the chief breadwinner should

die unexpectedly. We suggest you revisit and review your estate planning documents every three years. For our clients, we don’t charge for the meeting, which can be in person or by Zoom.

Time for a Review

We have a Zoom online training session on “Reviewing Your Estate Plan” on Tuesday, February 6, 2024, at 6:30 pm. It will help you find the basic choices you made in creating your plan.

To register, you can click here.

Time brings changes to life and laws.

You may divorce and remarry, have children from a second marriage, or wish to be sure that children from your first marriage are not disinherited. Adult children don’t need guardians, but a developmentally disabled adult may require Special Needs Planning to protect their eligibility for government benefits while having access to money from the family to maintain their quality of life.

Life’s changes are one reason why estate plans need reviewing and updating on a regular basis. An annual review may be necessary for more complex estates, while for more straightforward, more modest estates, a review every three to five years should suffice.

Recent years have seen dramatic changes in state and federal laws regarding taxes and retirement accounts. An estate plan created ten years ago will likely contain many out-of-date strategies and missed opportunities.

Changes in relationships impact estate plans.

Most trusts and wills include people with roles like trustees, executors and guardians who are alive and well at the time of the last will’s drafting. However, if the executor of your last will has died, moved to another state, or isn’t a part of your life and refuses to serve, an out-of-date last will presents several problems. Did the last will include the name of a secondary executor, and is the second executor still available to serve? If not, your family may have to accept decisions a court-appointed administrator makes. Your family may petition the court to have a family member appointed. However, there’s no guarantee the court will honor this request.

Changing tax laws call for estate plan reviews.

Changes to tax laws in recent years have dramatically altered the estate planning landscape. Any estate plan created before the SECURE Act (January 1, 2020) needs a review.

The 2017 Tax Cuts and Jobs Act dramatically increased federal estate tax exemption levels. However, this is expected to be cut by half when the law sunsets on January 1, 2026. An estate plan based on the 2017 TCJA with no provision for a federal estate tax exemption sliced in half may present significant estate tax issues for many Americans.

Last-minute changes create challenges.

Procrastination is part and parcel of estate planning, even for the most diligent people. Planning for incapacity and mortality is far better than putting family members in the position of guessing what their loved one would have wanted or battling with the court or each other over property distribution. Promptly updating a comprehensive estate plan also avoids the stress of needing last-minute changes.

If you haven’t visited your planning in the last three years, please call and schedule a review meeting. We look forward to catching up.

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Building wealth is only half the job. Protecting wealth for your loved ones and yourself is equally important. Through estate planning, business planning, and asset protection, our firm will help you protect everything you love — family, friends, and favorite charities. For more

information, visit our website, where you can explore details about our firm, gain access to our informative blog, and enjoy a complimentary newsletter subscription.

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Exercise the Will to Plan

Find Us Online

Building wealth is only half the job. Protecting wealth for your loved ones and yourself is equally important. Through estate planning, business planning, and asset protection, our firm will help you protect everything you love — family, friends, and favorite charities. For more information, be sure to visit our website, where you will have access to our blog, events schedule, and a complimentary newsletter subscription!

The Will to Plan

Despite the hectic pace of life in America today, most of us still enjoy a fair amount of leisure time. Almost all Americans (95 percent) engage in some leisure activity every day. In fact, according to the Bureau of Labor Statistics, we get about five hours of leisure time a day and spend most of it (almost three hours) watching television. The rest of the time, we do other activities like reading, relaxing and thinking, socializing, playing games, surfing the web, and participating in sports and exercise.

Conspicuously absent from that list is estate planning. Americans are almost overwhelmingly opposed to the idea. Harris Interactive recently polled more than 2,000 adults on the subject and found that 28 percent of us would rather do anything else, and nearly one-third said they would rather do their taxes or get a root canal.

Most Don’t Have a Will

Little wonder then, most of us (61 percent) don’t even have a Will, one of the most basic of estate planning documents. Dig a little deeper, though, and the numbers are even more disturbing. Among parents with minor children in the household, only 30 percent have a Will – the most universally accepted legal document for naming backup parents in the event the children are orphaned.

Of course, Wills are not the only documents needed to protect you (and your assets) in the event of death or incapacity. Another Harris survey found that only 29 percent of us have a Living Will to direct end-of-life medical procedures. Even older Americans are hardly prepared. The same Harris survey found that only 48 percent of those over age 65 have a financial power in place authorizing someone to make financial decisions for them if they are incapacitated, and only 51 percent said they had a healthcare power in place.

Even though estate planning is not on anyone’s list of Top Ten Favorite Activities, most of us realize the need to get at least basic planning in place to protect ourselves, our loved ones, and our assets from life’s uncertainties (and the one certainty of death). And yet, most of us haven’t done it.

Despite Good Intentions

Why not? The number one reason, given by more than 55 percent of respondents, is simple procrastination. Most people say they just haven’t gotten around to it.

If you’ve ever made a New Year’s Resolution, you know we all have good intentions … but our follow-through could use some work.

Piers Steel, a psychologist at the University of Calgary and one of the leading experts on procrastination, says it’s a “common pulse of humanity” to procrastinate despite our best intentions. “One thing that defines procrastination isn’t a lack of intention to work,” Steel says. “It’s the difficulty of following through on that intention.”

Steel goes on to say that for most of us, procrastination isn’t a pleasant experience. It’s a feeling of growing pressure – of knowing we will have to deal eventually with whatever it is we’re putting off … like creating the necessary legal documents to name backup parents for minor children, state our preferences for end-of-life medical care, designate financial and health care decision-makers in the event of our incapacity or death, and outlining a plan to distribute our assets after death. As difficult as those decisions can seem – putting them off by procrastinating only adds to the pressure and makes us feel worse. In fact, Steel writes in his book, “The Procrastination Equation,” that procrastination leads to lower overall well-being, worse health, and even lower salaries.

Beating Procrastination

If you have resolved to get your estate plan in place or up to date in 2024 – good for you!

Now, here’s a plan to beat procrastination: Steel says the trick is to reframe broad, ambitious goals into concrete, manageable, immediate chunks.

So, instead of saying, “This year, I’m going to get my entire estate plan in order,” break that down into smaller, less formidable goals. For example, the first step is to call our office and schedule an initial consultation of review meeting. Don’t let yourself get stalled by thinking of all the decisions you must make to complete a comprehensive plan. Focus on one quick, easy decision. a

Get a date on your calendar in January 2024.

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