For an estate plan to be successful, communication is key. Ultimately, failure to communicate and build trust within your family is a huge risk factor to the success of your wealth transfer. According to this J.P. Morgan article, many estate planning attorneys list “communicating the plan” as the final step in the process.
The article describes several common scenarios to consider when communicating your plan.
No one knows where your documents are or what is already arranged. When a loved one passes away, families often have to make quick financial decisions on their behalf, such as paying bills. It’s important to let someone know where you keep your paperwork, as well as passwords and account details. It can be so beneficial to equip your emergency contact ahead of time so that they don’t add on any more stress while grieving.
Your expectations are not shared with beneficiaries. This can be especially important if you plan to distribute shares unequally. This can be due to a child needing more specialized care or assistance or various other reasons. Disclosing this information ahead of time can mitigate any confusion or misunderstandings between beneficiaries.
You put one beneficiary in charge of everything. This can cause conflict in a few different ways. The named beneficiary could feel overwhelmed with the sole responsibility or those left out of the decision making process could feel hurt. It’s wise to name back-up people and make sure everyone is aware of the plan to help ease any conflicts.
Ultimately, be open about your wishes and ensure that your beneficiaries are prepared to take control. There is no time like today to start estate planning. Give Rhodes Law Firm a call to get started!