“THE LEGAL CORNER”
By Sam A. Moak
Leading by Example and Estate Planning
The information in this column is not intended as legal advice but to provide a general understanding of the law. Any readers with a legal problem, including those whose questions are addressed here, should consult an attorney for advice on their particular circumstances.
In the past year and a half far too many of my friends have lost young adult children. The loss of a child is hard enough, but the legal mess it can leave only makes matters worse.
Reflecting upon something I learned from my father as a young adult, (and did not appreciate as a young adult, but do now) made me realize he led by example. When I graduated Texas A&M and began my first real job, Pop had me sign a Will, Durable Power of Attorney and Medical Power of Attorney. It didn’t seem necessary at the time. After all, my entire worldly possessions consisted of a ‘67 Ford Mustang, ‘72 Jeep, some old furniture (retired from the Alpha Delta Pi house at SHSU), lots of posters and a bunch of junk accumulated from trips in college. However, it’s never too early to start estate planning. I was going to be working out of state and, if an accident occurred, those instruments put someone in charge while I might not be able to handle things.
Whether or not you already have a family, getting your personal affairs in order is a must. None of us know what life has in store for us. Fortunately, I survived my 20’s, but the losses I have witnessed my friends and clients experience have taught me, the sooner you start planning, the more prepared you will be for life’s unexpected twists and turns.
Unfortunately, death affects us all and does not consider age. Take for example the loss of a 23 year old son. Even if he had no children, what if he had been married? It is one thing if the marriage was good, but what if its not a pleasant marriage? What if the couple was separated, but not divorced? What if he wasn’t married, but had begun purchasing a house, vehicles or accumulating savings? What if his parents were divorced? Because he was “too young” to need a Will, his estate passes pursuant to Texas law, rather than as he may have wanted. The loss of a son is devastating, but to then quarrel about who gets assets, personal effects, or accepts debt can be another blow.
If you have young children, or other dependents, I can not stress enough how important planning is. The less you have, the more important your plan, so that it can provide as long as possible and in the best way for those most important to you. You can not afford to make a mistake.
You should sit down with your family and discuss various “what if” situations. This is important for a couple of reasons. One, so that you have communicated your wishes to those around you and, two, so that you have thought about the many contingencies that can occur (i.e., injury, incapacity, illness and death). This would also give you the opportunity to explain why you may have made a larger gift to someone rather than another or equal division. Many may have a second marriage and therefore children from different relationships and of broad age ranges. This and health can affect how you provide for your family. A frank discussion can help avoid hard feelings later.
However, just talking about it is not enough. Everyone should have the basic estate plan components. A life insurance policy, a Will, a designation of agent to control disposition of remains, a durable power of attorney and an advance directive are all important aspects of an estate plan that should be established at the beginning of the planning process.
Life insurance can provide money in the event of an untimely death and loss of income. This may be especially beneficial to young individuals. Perhaps a young couple has not accumulated enough savings or put aside for retirement. Loss of one or both spouses’ income can have devastating effects. Another factor to consider is that the younger you are when you take an insurance policy, the easier it is to pass required physicals and obtain lower rates.
Drafting a Will allows you to state how you would (or would not) want your assets transferred. A Will can designate guardians of young children and financial account trustees. As a general rule of thumb, the more detailed the Will, the better.
My father’s advice some many years ago, as most of his advice, resonates with me when I see families lose young adult children. It has also set a course for me that everyone should follow. As parents we pass on advice to our children. While my first Will and powers of attorney were very simple, I continued to update them as I grew and my situation in life changed. You should review the plan every five to seven years, to adapt to significant life events, tax law changes, the addition of more children or their changing needs. It is also important to keep tabs on your insurance policies and investments, as they all tie into the estate plan and can fluctuate based on the economic environment.
As older adults, our responsibility is to provide safety and security for our family. It is also to lead by example. Discussing your estate plan with your children lets them know how important it is for them to also plan.
If you have a question regarding Elder Law, Estate Planning, Living Trusts or Probate in the Huntsville area, please contact us at 936-295-6394 or visit our website. Call today and we will connect you with an experienced Elder Law and Probate Attorney. We can schedule you a face to face appointment to discuss your circumstances. If you have questions or are considering any aspect of your estate plan, probate, your health care directives, etc. we can help! Call us now at 936-295-6394 . We look forward to hearing from you and assisting you with any and all elder law and estate planning needs.
Sam A. Moak is an attorney with the Huntsville law firm of Moak & Moak, P.C. He is licensed to practice in all fields of law by the Supreme Court of Texas, is a Member of the State Bar College, and is a member of the Real Estate, Probate and Trust Law Section of the State Bar of Texas. www.moakandmoak.com