Some of the less predictable questions about planning for the future
For most people, estate planning is more painful than a root canal without Novocain. Among other things, it forces us to acknowledge that we may become demented: decide who gets what after we pass away; and make provisions for end of life care.
Facing our mortality is one of the hardest things we must do in life; to help implement your wishes, trusts and estate lawyers need to ask very tough questions. Some of them might make you squirm. Thinking about the following issues in advance can help you prepare for a meeting about your estate plan.
1. Who will raise your children if both parents die?
Many people find it very difficult to decide on a guardian for their minor children. If you do not name a guardian, then the court will do it for you, based on what it deems to be in the best interest of your child. Unless you have confidence that a judge who never knew you has better judgment than you do about matters involving your children, it is best not to stick your head in the sand for 18 years.
2. What if you all die in a common disaster?
Even if you are certain about where you want your estate to go – commonly to a spouse or partner, followed by descendants – you need to address what would happen if the whole family died together. For some clients the natural answer is “my parents,” “my siblings” or a particular charity. For others it raises issues that could take years of therapy to sort out. A client may be estranged from his or her family; not have other close friends; or have been too busy to develop a commitment to a charitable cause. For these people, addressing this remote possibility becomes the biggest stumbling block to completing an estate plan.
3. Are there any other descendants you haven’t yet mentioned?
If your lawyer asks more than once if there are any other descendants he or she needs to know about, it isn’t because the lawyer forgot about just asking the same question. Sometimes it isn’t until the third time that clients disclose information about children from a previous relationship, which their current family did not know about. Far better they are discussed at this stage rather than at your funeral when an unexpected face appears laying claims to your estate.
4. Have you told me about all the important relationships in your life?
Whether you are married or single, your lawyer may prod and ask if you are in a relationship with someone and if it has a legal status such as marriage or civil partnership. There may be legal obligations that come with these relationships that you need to know about.
Your lawyer can’t educate you about the rights and obligations unless they have the full picture. If you did not get around to finalising a divorce, or, you have another long-term relationship, or, children you have not previously mentioned, your lawyer needs to know, in order to mitigate the risk of long drawn-out court proceedings erupting after your death, consuming your estate in legal fees. You might think that this is what lawyers hope for, but it truly isn’t. It is a hard way to make a living and an even harder way to watch someone’s legacy destroyed.
5. Do you have genetic material on ice?
When thinking about children and descendants, science is pushing the boundaries of those definitions. Even if the lawyer doesn’t ask, you should disclose “what’s in the freezer.” In other words, do you have genetic material, such as fertilised embryos, eggs, or sperm, preserved for later use? If you do, it is critical to consider whether you want to provide for beneficiaries conceived after your death. And if you do, for how many years do you want to leave the window open for that birth to take place?
There are legal and logistical limits and complications to work out and your wishes might not be possible to carry out. But they should be openly discussed with your estate planner.
6. Are you transgender?
You may not want to disclose that you are in the midst of gender transition, or that you have been through one already. But there are legal implications that need to be considered if this is the case. Again, even if your lawyer doesn’t ask, this is something that you should bring up. It is critical to ensure that all of your legal documents and the gender identification contained in them reflect how you now present yourself.
7. Have you have ever made large gifts to others?
Often this is a question that we don’t want to think about, especially if we are supporting family members or friends who have fallen on hard times, aren’t able to support themselves, or got into financial trouble. This can be a difficult issue between couples who disagreed about making a gift that the other made.
Your lawyer isn’t asking this question to be nosy. Most gifts in excess of £3,000 per person, per year need to be reported in the inland revenue account. The gift might not actually be taxable, but it may still need to be reported. So, your lawyer can help you correctly report past gifts and get you back on track for future ones. We can also advise you on techniques to mitigate reporting and/or tax consequences. It is important to get this information on the table to get the advice you need to defend enquiries later on.
8. Who is going to take care of your pets?
You may not need to set up a full-blown pet trust, but you may need to set aside sufficient funds to be put in trustworthy hands to take care of Fido. If you have racehorses or animals with long life expectancies, you may need more sophisticated planning, including a pet trust. Or, if you don’t have someone you can rely on to take on your pets, especially if you have 17 cats or even two spiders, you will need to find an organisation to take care of your companions for the remainder of their natural lives. Your estate planner can help you do this.
9. When do you want the plug pulled?
Almost certainly your lawyer will ask you to sign a health and welfare lasting power of attorney. We each have a definite idea as to when quality of life has diminished too far. It is helpful to share that information with your attorney who has to be a part of carrying out instructions. If you don’t share that information, people may let loved ones linger on when if they had had more insight they might have ceased aggressive medical intervention sooner.
10. What are your passwords, user names and security questions?
Until a few years ago, we didn’t really worry about your digital life. Your e-mail and Facebook accounts will go dormant. But some people have self-published books that are only accessible on line, journalists and photographers may have their life’s work on a hard drive or saved in cloud storage. Plus there could be bank accounts you only receive e-mail statements for, blogs, music, Twitter, photo storage, and countless other financially and emotionally valuable assets accessible only by computer.
Your lawyer can help you figure out what needs to be preserved, what can be left to lapse, and who should be able to access these various accounts. There are a number of cloud storage sites, where you can store your passwords, and then you only need to give someone the password to access that information. Alternatively, you can leave the password to access your personal information in a safe deposit box or with your lawyer. Dealing with digital property is still in its infancy, and technology is ever changing, so there are no perfect solutions. But you and your estate-planning lawyer can explore the options and pick the one you are most comfortable with for now.
11. Did you enter into a prenuptial or postnuptial agreement?
These documents may be long forgotten and long ignored as irrelevant. But after your death, a disgruntled heir could surface them and derail your best estate planning intentions. Even if you don’t consider them relevant any more, disclose them. If they really aren’t relevant, your estate planning attorney can help you legally terminate them. But to provide that assistance, the lawyer has to know that the documents exist.
12. Have you had any serious or chronic health issues?
You might not think this is relevant to estate planning. No, your lawyer isn’t wondering if he or she needs to put off a holiday for your imminent probate. Rather, a lot of sophisticated planning is based on actuarial life expectancies. The reality is that those techniques are only useful if the actuarial tables approximate what we think to be true. If you have particular health concerns or health conditions that could change assumptions of life expectancy, we would plan differently.
Whether or not your lawyer concludes with the catchall question, “Is there anything else I should know?” don’t be afraid to speak up. Chances are you’ve covered a lot of territory. Conversations can be circular, rather than linear. Maybe you started to say something and got distracted. Or perhaps you haven’t gotten to something you expected to cover. That additional little detail might not be relevant. Or it might make all the difference.
Wendy S. Goffe Stoel Rives, Seattle