Estate Planning Readiness

Estate Planning Readiness – (Download as PDF) 


If you were incapacitated or died today, what would happen to your loved ones and your property? Who would assume responsibility to make sure everything was okay? How would anyone know your plans for the care of your loved ones and your property? Even if you have answered these fundamental questions through proper estate planning, it is important to review your answers periodically, because they may change over time. To help ensure that your review is thorough, remember to cover the Three P’s of proper estate planning: People, Property and Plans.

Your People

Our life experiences are enriched by the relationships we develop with other people. Who are the important people in your life? Depending on your unique circumstances, your list may include your spouse, children, grandchildren, parents, siblings, nephews, nieces or friends. Beyond these, your important “people” also may include worthy causes, charities and even pets.

Your Property

The term property includes not only real estate, but all of your assets, regardless of form. What property have you accumulated? Have you inventoried and valued your things? Do not forget tangible personal property, such as heirlooms and antiques. Remember, sentimental value can far exceed appraised value.

Your Plans

At the foundation of every comprehensive estate plan is the selection and appointment of successor decision-makers to make personal, health care and financial decisions in the event of your incapacity. Likely, such successors would continue to manage your property following your death, as well.

Whom have you appointed as your successor decision-makers? Do they have the time and expertise to serve? Would it be wise to appoint professionals to help them with the details? Professionals, such as trust companies or accountants, may be more appropriate given your unique circumstances. In addition, if you have minor children, have you appointed guardians to ensure your children would be reared in a loving home should they be orphaned?

Issues surrounding the division and distribution of property can shipwreck family relationships. Do you have sentimental, one-of-a-kind items? Studies show that many family fall-outs result from failure to make legal arrangements for the distribution of these important items.

Do you have a family business? Two-thirds of family businesses fail to survive the exchange from one generation to the next, largely because they have no succession plans. Who among your children will inherit your business? Have you made arrangements in your estate plan to treat your other children fairly, if not equally? Will your plan discourage or even prevent conflict among your heirs?

Is yours a blended family? If so, what plans have you made regarding the treatment of your property upon your death? How will you honor your vows to provide for your surviving spouse and still fulfill your desire to leave an inheritance for your own children from a prior marriage? Does your estate plan protect any inheritance left for your surviving spouse from a potential next spouse?

Divorces, lawsuits, bankruptcies or affluenza can wipe out an inheritance virtually overnight. Does your estate plan protect any inheritance both for and from your children (and their possible future misfortunes)?

Given the certain uncertainty regarding any future death tax, does your estate plan contain the necessary flexibility to achieve tax minimization goals? If not, the IRS may be one of your heirs.


Failure to make and maintain proper estate plans for the important people in your life and for your property can lead to family fall-outs, litigation and other unpleasant consequences. Reviewing the Three P’s of your estate plan could help avoid them.



Whether you just tied-the-knot or just celebrated your Golden Anniversary, it is never too soon to get your legal house in order as a couple. In this article we review some fundamental legal tools and techniques that are must-haves for every married couple.

Durable Powers of Attorney

Many married couples mistakenly believe that upon exchanging vows they are granted blanket legal authority to carry out their mutual pledges to care for one another in sickness and in health. Unfortunately, the law requires further and more specific written legal authority. For example, if one spouse is legally incapacitated due to an illness or an injury, then this becomes painfully apparent.

Each individual adult American is responsible for making his or her own personal, health care and financial decisions. When incapac­ity strikes, that responsibility does not end. But, under such circum­stances, who will make these deci­sions? Bottom line: It will either be someone appointed by you in advance, or someone appointed for you by a judge in the probate court.

Hint: Hiring an attorney to pre­pare a durable power of attorney to appoint your spouse as your agent is much less expensive than hav­ing a judge (plus the two addition­al attorneys required) eventually appoint your spouse anyway.

A durable power of attorney may be prepared to cover both financial and health care matters in one document. Alternatively, separate documents may be created with one for financial and the other for health care. While you are at it, remember to prepare a living will or a health care treatment directive to provide proof of your end-of-life treatment wishes.

Wills & Trusts

Once you have made arrangements to care for each other in the event of incapacity, make arrangements for the smooth transfer of your assets to one another upon death. These transfers may be outright or in trust. Also, do not forget to make arrangements for any eventual inheritance that may be left to your children.

Sometimes it is wise to protect an inheritance both from and for your children. Testamentary trusts, whether established under a last will and testament, or under a revocable living trust, can provide considerable inheritance protection for your children from potential divorces, lawsuits or bankruptcies, as well as from squandering.

Estate Tax Challenges

Not only is the only certainty about the federal estate its long-term uncertainty with each change in Congress and the White House, but many states have imposed their own estate taxes, independent of any federal estate taxes. Accordingly, careful monitoring of the economic, political and legal climate is required.

Note: Historically, whenever there is an estate tax, there also is a “use-it-or-lose-it” estate tax exemption available. However, this tax exemption is not automatic and careful planning is required to fully maximize your federal estate tax savings.