via Will power: Get documents in order, on clarionledger.com.
It happens with astonishing frequency. An elderly parent dies without a will or living trust, leaving it to the courts to figure out who’s going to get what. In the meantime, families can be torn apart by relatives fighting for a share of the estate. Such battles don’t just affect those with hefty estates; even minor possessions can be the subject of discord, and families have been torn apart over what seem like trivial matters, but are actually fraught with a lifetime’s worth of emotional baggage.
With senior citizens’ numbers at historical record levels, many of them will die without having made arrangements for what happens to their property. Dying intestate (without a will) is incredibly common. According to a study released this week by Caring.com, only a little more than half of American parents have a will or living trust document.
And even if there is a will or trust documents stashed away in some drawer, it’s likely the documents haven’t been updated; only about four in 10 parents have updated their documents in the last one to five years. Nearly a quarter of adult children don’t know if their parent’s will has ever been updated, and even if there’s a will, there’s never been a discussion about what happens after the parents pass on. Adult children often wouldn’t know where to find the documents, much less what they entail.
“Wills and estate documents can be a touchy subject, but they are necessary conversations to have,” said Andy Cohen, CEO of Caring.com. “Too often the surviving family members are left not knowing where to find the documents, or worse, have to go through a lengthy and expensive legal process because no documents were ever created.”
The reasons for people not having wills are usually not that major. According to the legal site RocketLawyer.com, a survey last year indicated most (57 percent) just hadn’t gotten around to making one. Other excuses: It just wasn’t an urgent need, they didn’t think they needed one, and they didn’t want to think about death.
Caring.com’s study also looked at the differences between women and men, and people of different ages. Adults 18-49 are the “least likely to be informed about their parents’ documents,” but nearly a third of adult children over 50 wouldn’t know where to look, and even fewer know what’s in the documents. Women are generally more knowledgeable about the contents of the documents, while men are more likely to know where they’re stored.
Nearly all financial experts urge us to think harder on these issues; although the rules for who gets what are pretty clear in most states where there’s a surviving spouse or minor children, having a will or trust set up before you need it can give you peace of mind, directing what you want to happen to your estate after you die.
So, if you are a parent and don’t have a will or trust, or if you’re an adult child and your parent doesn’t have one, it’s a good idea to start now, keep the documents updated, and make sure someone you trust knows how to find them.
•Be intentional. A discussion about death is never easy, but it’s necessary. Parents of adult children should make it a point to discuss end-of-life matters with their grown children, and everyone needs to be ready to have a serious discussion while the elderly parent is still able to make good decisions. Include all children or heirs in the discussion. Discuss the will, funeral arrangements, what happens to family heirlooms and anything else. Put everything in writing.
•Be grown-up. This isn’t a time to dredge up old family arguments, but it is a time to be open and honest about how you feel about things and to get some planning done. Although the parent-child relationship is complicated, an adult discussion needs to take place; important decisions should be made.
Forbes has a good article on this subject. In it, the author lists four main areas for discussion:
•Legal: Have they done estate planning? Who is their attorney? What legal documents do they have in their possession? Is there a will, trust, durable power of attorney for finances and health care directive? May you speak with the attorney?
•Health care: What medical insurance do they have besides Medicare? What is covered? Is there long-term care insurance? Do they have assets set aside to pay for care at home should they need it one day? What amount is available? May you have permission to speak with doctors?
•Income and expenses: What income do they have, and what are their debts and expenses each month? Where are the records for these? Do they have a financial planner? May you have permission to contact that person?
•Financial records: Where do they keep their tax returns? Who prepares them? Where are their bank accounts, brokerage accounts and other records of assets maintained? Do they bank online? Where do they keep their user names and passwords?
While dealing with the loss of a parent will be one of the most difficult times in our lives, having difficult questions already answered will mean one less thing to worry about.