The Estate Planning Competence Matrix here will help you maximize your planning, or maximize your Parent’s planning if you are looking for a productive way to approach the considerations and the helpful Estate Planning materials that you should be considering.
The basic considerations and information gathering (below the line). Where you are or should begin:
THE INFORMATION ZONE
Nobody likes to do this, but taking stock is the key to success above the line on your journey to Estate Planning Competence!
Start with information gathering. You and your Attorney need to know the complete asset and property picture, as well as the current personal information and background. An Estate Plan cannot be derived in a vacuum. Well, it can, but it would likely leave unnecessary holes and fail to produce optimally effective documents for you and for your Estate Executor or Living Trust Successor Trustee.
Gather the following documents and information:
1. Copies of insurance binders or information concerning insurance policy numbers and insurance company and rep/agent (with phone number) for policies now in force. This includes Homeowners/Auto (is there an umbrella policy?), Life (term, whole, variable; who are beneficiaries; face amount), Health and Disability Insurance.
2. Information concerning major personal assets:
A. Copy of title for autos, boats and other titled vehicles;
B. Real Estate Properties Owned (pull copy of deed for home residence, investment properties, timeshare interests, and leasehold interests);
C. Account information, including all financial, stock, bank and other accounts (and estimated value); Identify if any of the accounts are jointly owned with others, or if you have given permission to other persons to sign and authorize transactions for the account;
D. If not included with the other account information, list 401k, Pension, Annuity, IRA, CD and similar accounts and whether beneficiaries have already been identified for those accounts;
E. Bonds, stocks held in “street name”;
F. Other significant assets (include jewelry, antiques, collections, cryptocurrency, intellectual property assets such as patents, copyrights, and options to acquire assets or business interests).
3. Information concerning any businesses or business interests owned by you. Identify others who own an interest in the business; Is there a buy-sell agreement, shareholder agreement or operating agreement (for an LLC) controlling transfer of interests/shares during lifetime or at death?
4. Information concerning major current liabilities, such as a recent mortgage statement, or business guaranty or lease guaranty information. Are there any personal loans from others to you or from you to others? Auto financing or auto leasing information, including a copy of a recent statement.
5. Include copies of other documents not already identified, such as:
A. Copies of birth certificates, for you and your spouse or partner, and children; as well as adoption records for adopted children;
B. Copies of death certificates for spouse, children;
C. Information concerning military service and discharge;
D. Information concerning important memberships (are you entitled to death benefits, pension-type accounts if any, etc.?);
E. Copies of burial plot deed, contracts for perpetual care for you and for relatives for whom you have responsibility to oversee those issues; cremation and other plans and contracts made (if any); and
F. Significant Agreements and Contracts: storage/warehouse leases, USPS or UPS Store box rental agreements, Safe Deposit Box rental agreement, and employment agreement or independent contractor agreement, and others.
6. And, if this Estate Planning Competence review is to update your previous considerations and documents that you have implemented or considered implementing, including copies of prior Last Will & Testament, Living Trust, HIPAA Authorizations, Living Will Declaration, Power of Attorney for Health Care and Power of Attorney for Property, and other documents that may have been drafted for you and signed by you.
THE IDEA ZONE
Here, before putting pen to paper for formulate the Estate Planning ideas with your Attorney, begin to identify some of the key people who will play a role in your plan – both now and after you are no longer here. This means that you will start to point to the following persons and information:
A. Contact information for spouse (domestic partner, significant other), children, parents and siblings;
B. Religious affiliation, religious leader’s name, city/state and phone contact;
C. Insurance agent(s);
D. Accountant/tax preparer(s);
E. Primary physician/internist/obgyn;
F. Business partners;
G. Property managers/caretakers;
H. Veterinarian (and identify pets); and
Make your notes for answers to the following important questions:
Are there any health or other conditions affecting you, your spouse or significant other, or your child or parent that should be discussed (even if the condition is not now presenting itself)?
Who will be the guardian for minor children if you are unable to care for them?
Who will take care of an aging parent or other person that you care about?
Who will make healthcare decisions for you if you cannot make those decisions for yourself? Have you considered at least one alternate who could act in that role for you?
Who will make property-related decisions for you if you cannot make those decisions for yourself? Have you considered at least one alternate who could act in that role for you?
Lastly, for this pre-discussion/pre-documentation stage, have you heard about Wills, Trusts and other Estate Planning Tools that you believe you may want to explore? Have friends or family members mentioned their use of a life insurance trust, special needs trust, transfer-on-death-instrument or other mechanism? Be sure to be ready with your questions, even if you are not sure whether those items may not ultimately be for you.
You are now ready to consider those Estate Planning Competence items that are above the line:
THE GROWTH & DRAFTING ZONE
Here, you will meet with your Attorney. A call or remote Zoom video conference may be worthwhile before a first face-to-face meeting. Your Attorney can understand the information that you have gathered, can be mindful of the timing of your planning (including any outside pressures that need to be considered). And, together you and your Attorney can identify any worrisome issues (such as, perhaps, a pending or anticipated divorce, or the illness affecting a child or significant other, or the loss of home or business or employment).
Your Attorney is there to share the good and the bad. Setting expectations for what your Attorney can accomplish and when is an important part of the journey.
Your Attorney will discuss a proposal for the type of Estate Planning materials will be beneficial to accomplish your goals. You will agree on the timeline for preparation of the materials and the fees and expenses to be expected. You will, as well, identify any additional documents that are necessary or useful for the Attorney’s work for you.
Then comes the important step of reviewing the Estate Planning documents prepared for you, tweaking those documents to ensure that they are ready for signature, and arranging for and executing the documents.
OK, you are reaching an optimal level of Estate Planning Competence! You are ready to take the next step on the journey:
THE SWEET SPOT
Here, you know you have reached an optimal level of readiness and planning when you have stepped ahead to do the following:
Assemble your Estate Planning personal resource. You will be pulling together into a central location (a “hard” file or a digital file) with your important Estate Planning documents and the materials that you have gathered in order for your family to be best able to assist you in the event of an illness or injury or other event. Discuss with your Attorney the use of a cloud service account (DropBox, Box or other service shared account) where you can securely maintain your important documents and information.
Fund your Trust! If you have decided with your Attorney that a living, revocable trust is going to be part of your Estate Plan, then you will take the next steps for the funding of your trust. Your Attorney will provide for you a Certification of Trust and provide guidance for your next actions with accounts, property deeds into trust, and other important functions.
And, don’t forget that the Sweet Spot is forward-looking: You will review regularly any questions that you have, changes that may be necessary because of significant life events for you or your family members or others close to you, and review your Estate Planning documents and the people that you have selected to act in important capacities for you (usually every 12 to 18 months).
Attorney Maureen Meersman and Attorney Marc Sherman are available to discuss your own Estate Planning Competence, or to address concerns that you have with your family member or significant other who need help to focus on their own Estate Planning questions and concerns. Our Contact Information is available here: https://mshermanlaw.com/contact/
