What Your Loved Ones Need to Know About Your Estate Planning

estate planning

A conversation with your loved ones about your estate plan is not always the easiest thing to do. While fear of discussing one's own mortality as well as a hesitation to approach a topic that could cause discord may keep you from doing this, it is an absolutely vital discussion. Not only should you make sure to talk to your loved ones, but there are certain things that need to be a part of the conversation. While you do not need to go into every single specific if you do not wish to, you need to cover the basic logistics of the estate plan at the very minimum.

Large suburban house
Photographer: Jesse Roberts | Source: Unsplash

Unfortunately, families fighting about money after loved ones are gone is far too common. It is a fact of life that people want to get the most possible for themselves, and unfortunately money comes before family bonds. Your conversation about the estate plan should factor in this human motivation and aim to ensure that things can be as harmonious as possible when you are gone and your family is going through a difficult time.

Estate Planning Conversation

The first major part of the conversation is letting your loved ones know that you have an estate plan. Unfortunately, all too many people die without one, and the probate process is a difficult one for anyone who has to go through it. Simply informing your family that you are planning for the worst should ease their burden of worry.

Another major topic of conversation is the discussion that you will need to have with the person who will be the executor of your will or the one who will make decisions on your behalf if you become incapacitated. Thanks to the concept of the living will, many decisions that are a part of your plan may be made when you are still alive. Make sure that the person who will be primarily responsible for making these decisions is comfortable filling this role and that your other loved ones know who has been chosen for this task.

Photographer: Melinda Gimpel | Source: Unsplash

One part of the discussion will be the theory that is behind your estate planning decisions. You may decide that you want to enjoy your assets while you are here and may plan accordingly. Conversely, you may decide to minimize your spending so that you can leave a large estate for your loved ones. Your family needs to be familiar with your thinking because it could counsel the way that they act when you are gone. To the extent that your estate plan contains any decisions that could be a surprise, you should explain your thinking to your family now.

Similarly, you may have various priorities for your assets. For example, making a large contribution to a favored charity may be important to you. It is important to prepare your family members for this ahead of time since it will reduce the amount that they inherit. This way, they can temper their expectations and plan accordingly. Here, it may be better to give as many specifics as possible.

In addition, you should inform your loved ones about the values that underlie your estate plan. For example, if you have a blended family, you may want to have an estate plan that tries to act in fairness at all times. You could decide that all children from both partners get an equal share. Alternatively, fairness could mean that the children of the partner who contributed most of the assets would inherit the bulk of the estate. While you do not have to get into specific percentages down to the penny, it is important to set expectations for this ahead of time. Family members may accept whatever decisions that you make with less protests if they can hear your reasoning directly from you instead of reading a piece of paper once you are no longer here.

One of the main questions that families have is how much detail they should go into with their loved ones when discussing their estate plans. When it comes to the logistics of the will, no details should be spared. Your family needs to know where every key paper or piece of information is located so that they can access it after you are gone. At the same time, they also need to know the names of attorneys and other key people as well as who is handling certain critical responsibilities. Even if the paperwork is completed, it will not do your family much good if they do not know where to find it. You should extensively address every possible arrangement and piece of documentation and make several different master lists and discuss the whereabouts of everything.

Many families anguish over how much to tell their loved ones about their estate plans. There are two different schools of thought about this. Some believe that it is best to tell their families everything, right down to the exact percentages, since it will bring everything out into the open and eliminate surprises. This degree of transparency has its benefits, but could cause tension and pressure in the near-term. Others tell their families what they need to know about the mechanics of the estate as well as broad details about the estate planning decisions. However, they leave the details about some of the specifics to be revealed once the will is read. This approach will maintain harmony now, but can lead to discord down the road.

Each person needs to read their own family dynamic in order to figure out the amount of detail that they need to give their family. An estate planning attorney can help you figure out how much you need to tell your loved ones as well as the best way to inform them of what is in your estate plan. When it comes to the estate planning process, you can rely on your estate planning attorney to be not only a legal adviser, but a counsellor as well since they have dealt with countless family dynamics.

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