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San Diego Probate & Estate Administration Law Blog

Procrastination and estate planning: The excuses

Do you know people who have not written a will or made an estate plan? Even if you never talk about it with them, you probably do. A shocking amount of people have never drafted a will. They just keep procrastinating and putting it off.

Have you ever wondered why they do this? Some potential reasons include:

  • They do not have any idea how to get started. They know they need an estate plan, but it sounds complex and confusing. They just don't know where to begin, so they do nothing.
  • They do not feel like working on it. They get distracted by other projects and activities. The estate plan feels like work. They just procrastinate because they have other things they want to do more.
  • They worry about doing it wrong. People often procrastinate -- this goes for far more than estate planning -- because of a fear of failure. This may be wrapped up in their confusion over where to begin. They worry about doing it wrong, so they do nothing -- which is actually the biggest mistake they can make.

The 3 main goals of an estate plan

There are dozens and potentially hundreds of individual goals for an estate plan, which differ from person to person. What your goals are depend on what assets you have, what you want to accomplish and what your family needs.

However, the basic goals that you have can be divided into three main areas of focus. They are:

  • The basic distribution of the money and assets you control after you pass away.
  • Reducing the amount of taxes that your heirs have to pay on the inheritance and ensuring that those taxes are not exorbitant.
  • Making sure that, should you become incapacitated and unable to make your own decisions while you are still alive, you have a trustworthy person in place to do it for you.

Before creating a health care proxy, talk to the agent

When you draft a health care proxy, the goal is to pick an agent who will then act on your behalf. If you cannot make medical decisions, they make them for you.

For instance, if you have a stroke and you cannot speak to the doctors, they can decide what type of treatment you want. As you can imagine, it is very important to pick someone you trust explicitly. They could literally hold your life in their hands in some cases.

Sibling rivalry, even in adulthood, can lead to estate disputes

In some cases, estate disputes start because of sibling rivalry. The way that kids have related to each other all their lives can continue even into adulthood. This can make them compete with one another or resent each other. Those feelings come back up when they do not agree with a will or estate plan.

Plus, their parents have now passed away, leaving a leadership void. While Mom and Dad may have been good at handling their kids and their different personalities when they were alive, the children may not know how to do that on their own.

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Life expectancy keeps dropping. Are you prepared?

The general assumption in the modern world is that life expectancy should keep going up. As medicine advances, people live longer. We haven't had a war on the scale of the World Wars in generations, diseases are more contained than they have been in the past and technology has improved at a simply astounding rate.

However, all of that aside, the reality is that life expectancy in the United States has been trending in the wrong direction. It fell between 2016 and 2017, and then it fell again between 2017 and 2018.

A trust helps make an estate plan simple and accurate

Dying without a will means you have no control over your estate, and it has to go through the court process, passing on to your heirs in accordance with state laws. Even with a will, it can take time and money to show that the will is valid and start to move assets around -- especially if the heirs have any sort of dispute about the validity of the document. Though a will lays out some of your wishes, it does not really give you control.

As a result, more and more people are turning to trusts. They give greater control, making it so that the estate plan accurately reflects what the deceased wanted and making the process simpler for the heirs.

The trouble with selling your home as part of your estate plan

In some cases, parents do not want to leave their homes to their children. They feel like it would just be a burden for the kids to have to decide if they want to keep it or sell it -- not to mention going through with the sale and splitting up the money. It can even lead to estate disputes.

One option, of course, is to sell the house in advance. This way, the parents have to do all of the work on the front end, and they can just leave the money to the kids. This is far easier to divide than real estate.

Tell your children why you decided to use a trust

If you decide to use a trust for your assets, it can prevent the children from using those assets in the way that they want. For instance, a trust could stipulate that the child does not get any money until age 30 or that the money has to be used to pay for college tuition.

The reason that parents do this is often to keep children from spending all of the money too quickly or in a manner they do not approve of. They want to have some control over their children's lives. This may be simply to protect the kids -- understanding that an 18-year-old may make regrettable decisions that a 30-year-old would avoid, for instance.

I'm worried my kids will blow all I leave them. What can I do?

Parents typically love all their children equally, but this doesn't blind them to their weaknesses. When it's time to sit down with your estate planning attorney and devise your estate plan, you need to be fully transparent about your proposed heirs' abilities to manage any inheritance you may leave them.

This is a delicate issue, as what parents may perceive as their children's poor financial decisions could simply be radically different lifestyle views. For the sake of argument, let's say that you have an adult child who has demonstrated throughout their lifetime that they are hopelessly inept when it comes to financial management.

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