Comparing Three Basics Kind of Estate Plans
June 7, 2021The First, Most Vital Approach to Know About Your Estate Plan
One of the most common problems I see as an estate planning attorney in Tulsa:
You, the normal person, are worried about the future, making sure your spouse or kids are taken care of.
But, the people giving advice are worried about stuff.
>“How much stuff do you have?
> Who should get your stuff when you die?
> How and when should they get your stuff?
> Avoid the stuff tax!”
You’re worried about people. They’re telling you to think about stuff.
But, your estate isn’t just your pile of stuff (no matter how big or small that pile is). And an estate plan is a lot more than just “what happens to my stuff when I die.”
(To learn about some of the other most common misunderstandings in estate planning, and how you can avoid them, click here to download our short guide, The Four Biggest Estate Planning Myths).
Here’s the way most people think about the important things in life:
- I take care of my kids
- I make my healthcare decisions
- I own my stuff.
Together, these are the things that make up your estate, and they’re like a wheel:
You’re the hub in the wheel. Everything revolves around you.
The “spokes” in the wheel are the legal rights and responsibilities that connect you to the important things: your decisions about your body and healthcare, your care for your loved ones, and your ability to control your stuff.
So what happens if we pull the hub out of that wheel?
A wheel without a hub is a pile of useless wood. It’s kindling.
It’s a disaster, right? A wheel without a hub isn’t a wheel at all!
So what we need is a new relationship to these important things. We need to look at them differently. We need a new view(cough).
It’s vital to see your life as the hub of that wheel, and to have a plan for the whole thing if something happens to you.
If we just keep ourselves at the center of this wheel, we’re begging for trouble. We all know that it can’t work like that forever, and we’re convinced we’ll get around to it before it’s ever a problem.
That’s likely to be way in the future…right?
Your Plan is for You
The first step in providing for your family is to make sure you provide for yourself. If you lose control, and there’s no plan in place, a messy and expensive court process called guardianship becomes necessary.
Estate Planning doesn’t begin in the graveyard. For most people, it will start somewhere like this 👇🏻
Your estate plan needs to cover your right to make healthcare decisions for yourself. The decisions range from whether you’ll get a specific surgery, to whether the ventilator stays on when you’re not expected to wake up, to what happens after you’ve died.
These are big questions that need answers, and trustworthy people to follow through on them.
If you’re facing surgery or other risky treatment, and you can’t make your own healthcare decisions, who can? Or maybe more importantly, who can’t?
”Next of kin” is the most common choice. But for you, that next of kin may be too far away, or not dependable, or have convictions about what kind of treatment you should get that don’t line up with yours.
Do you have deeply-held beliefs about what should happen to your body when you die? Are you passionate about helping further scientific discovery, finding new necessary treatments, or saving a life through transplantation?
It’s vital to know that your convictions about your body will be followed by your people if you’re not able to do that for yourself.
You can’t do that without an estate plan!
Your Plan is for Your People
Our kids deserve our protection —even if we’re not physically there to provide it.
Your estate includes the legal responsibility to take care of your kids or other important people in your life who are dependent on you.
And if you have kids, who do you trust to raise them in a way that matches your convictions if you’re gone? Again, close family may be the most natural choice if the state has to be involved.
Maybe it’s crucial to you that your kids be raised in church, but you know your sister spends all her Sunday mornings going a little too crazy at brunch. Uh-oh.
Maybe your parents are your first choice, but you know they’re near retirement and talking about downsizing their house, and if—like me— corralling your three-year-old makes you collapse in exhaustion after surviving another day, maybe mom and dad won’t quite be up to it!
What matters is that you decide what fits you and your kids.
And you’ve got to write it down.
And yes, your plan is for your stuff.
Even though your plan isn’t just about stuff, that stuff is definitely a part of the plan.
Maybe your goal for your stuff is to enrich your kids’ lives. Maybe it’s to only provide for school, a wedding, a home — the big landmarks.
Maybe you’re more passionate about a charity. Your no-good kids don’t deserve a penny!!! (I kid).
You can do a lot of good with your stuff when you’re gone. Whether it’s for family or philanthropy, your options are almost endless.
If you’re “not rich” now, does that mean that you aren’t already enriching your kids’ lives?
Does it mean your gifts to the church or the animal rescue aren’t celebrated—and helping accomplish vital work—just because the checks other people write have more zeros?
I don’t think so. And I don’t think you do either.
What’s the takeaway?
Hopefully it’s now crystal clear that your plan is about way more than what happens to your stuff.
Your estate plan is actually about you, and your family. The stuff is important, but a good plan actually lets the “stuff” take the place it should be taking.
When there’s a crisis, and we already know what to do, then you can live life as you need to.
Your family can be present in the hospital room. They can grieve at a graveside. If no crisis has come yet, you can have an unshakeable conference that your people will be able to navigate those hard times.
And that’s because the “stuff” is secondary, and it’s been handled. It doesn't have to consume their attention. You don’t need to be worried about what the hospital, the bank, or a court will say.
That’s the peace of mind a plan can give you. It can let you just live your life. This is what you can do for yourself and your family when you create your plan.
