Why Talking with Your Parents About Estate Planning Is Important
If talking about your parents about their finances, health care, and wishes after their death makes you uncomfortable, you are not alone. According to a survey conducted by Fidelity Investments, 67% of adult children and their parents disagree about when they should talk about their finances and estate planning. However, while most families dread having these discussions, families who do enjoy the peace of mind that comes from being better equipped for the uncertainty of the future.
If you are ready to have the estate planning conversation about Living Trusts with your parents but are unsure where or how to start, you’re in luck! Our knowledgeable and experienced Estate Planning Attorneys have compiled expert advice about how to talk with your parents about the future, why planning will benefit the whole family, and what legal documents they should have in place.
When you are ready, our friendly attorneys are here to guide your family through the estate planning process ensuring your parents will enjoy the confidence that their desires are accurately and legally documented for the future.
“After my parents retired this year, we realized we didn’t know if they had any plans in place for their future. We called Mike Abrate who gave us some advice about the best way to start the conversation. Two weeks later my parents met with Mike to create an estate plan and now we all feel more secure about our parent’s future.”
– Bobby R. Sacramento, CA
How to Talk to Your Parents About Estate Planning
The best time to start a conversation with your parents about their future is now. Talking with your parents while they are still in good physical and mental health is the least stressful time for everyone involved. All too often families wait until some type of tragedy or health concern arises before having a conversation. According to a study by Ameriprise Financial, a life-altering event was the trigger for 90% of adult children to discuss their parent’s future.
According to our Estate Planning Attorney Mike Abrate, “One of the most important factors of creating a solid estate plan is doing so when the creator is of sound mind. When a history of health concerns like Dementia or Alzheimer runs in a family, establishing an estate plan before any symptoms appear is of the utmost importance.”
So how do you approach the conversation with your parents? Mike suggests, “Be upfront about your desires to make sure the whole family understands exactly what your parent’s desires are for their future. If possible, planning a family dinner and first discussion is a great starting point.” It’s also important to establish planning for the future is more than just deciding who gets what in a will. “An effective estate plan includes important legal documents like a Will, Trusts, Power of Attorney, and an Advanced Health Care Directive.”
Focusing the conversation on the many benefits that advanced planning will provide to your parents and their heirs is important and lets your parents know your main objective is to carry out their plan exactly how they envision.
Benefits of Estate Planning for Your Parents and Family
When carefully created, an estate plan can provide many benefits for both your parents, their family and loved ones. Here are the 4 biggest benefits to discuss with your parents about estate planning.
Health Care Decisions:
Estate planning tools allow your parents to provide details about how they would like their health care decisions made if a situation arises where they are unable or incapable to make them. This removes any misunderstandings or disagreements between family members about who will make important decisions and what their desires are for care.
Ensuring Their Legacy:
Your parents may have very specific beliefs about how they would like their assets distributed and how they would like their remains handled. With an established estate plan, they can provide surviving family members with the details about burial or cremation preferences, along with any special requests for memorial services.
One of the most difficult discussions can come from the distribution of their assets. It is important to understand that they can keep the specifics of how their assets will be divided to themselves. If their desires are carefully documented, and a trusted executor is chosen for the estate plan, their desires will be followed as they wish.
Saving Time, Money, and Stress:
When a person passes away without a will or estate plan in place, they are referred to as dying intestate. In this situation, the estate will likely be required to pass through the Probate Courts. When probate administration is required, the court will appoint an administrator to distribute the estate’s assets in accordance with local probate laws. This process is often long, includes legal fees that could have been avoided, and is stressful for family members.
Additionally, estate planning tools are available which allow assets to avoid probate. Avoiding probate reduces or eliminates estate taxes, wait times, and stress for beneficiaries. You can learn more about the benefits of Avoiding Probate here.
Avoiding Family Conflict:
Without a detailed and legally binding document created by your parents, their wishes are subject to different interpretations by surviving family members. “Disagreements between family members can be all too common when a parent passes without an estate plan in place.” Says Mike, “Arguments are not just limited to who gets what, but how Mom or Dad wanted their remains handled or even if they wanted a memorial service.” While an estate plan cannot guarantee family members won’t argue, it is the best way to minimize the potential.
“Cannot say enough good things about the Abrate & Olsen Law Group! Their Estate Planning knowledge is second to none. They have helped my parents, siblings, and my wife and I easily develop plans that take care of all of life’s possibilities!”
– Jay R. Sacramento, CA
What Documents Should Be Part of Your Parent’s Estate Plan
A well-crafted estate plan can include so much more than just a will to help your parents establish their future plans and legacy. Continue reading to learn about the most common legal documents we recommend as part of an estate plan and what they are used for.
Wills are the cornerstone of an estate plan. They allow the creator (testator) to designate how any assets are to be distributed to beneficiaries, appoint an executor to manage the estate, provide details about how they would like their remains and memorial services should be handled. You can read more about the benefits, limitations, and what is included in a Will here.
Trusts are very powerful estate planning tools. While assets left in a will can still be subject to passing through probate court, assets placed in trusts are able to pass outside of probate. This can reduce the effects of estate taxes, save time and stress for beneficiaries, and are not subject to public record. You can learn more about the benefits and various Types of Trusts here.
Power of Attorney:
A Power of Attorney (POA) can be one of the most important estate planning tools available. While sometime thought of as a way to appoint a person to make decisions for you if needed later in life, POAs should be created for any unplanned situations that may occur in your lifetime. They can be used to appoint a representative to care for dependents if you are unable to, make financial decisions when unavailable or unable, or to make specific health care decisions if you are found incapacitated for a variety of reasons. You can learn more about the benefits and different types of Power of Attorney documents here.
Advance Healthcare Directive:
An Advance Health Care Directive is a collection of legal documents found in an estate plan including, a living will, instruction directive, health care proxy or health care power of attorney. Together these documents allow the creator to provide instructions for the type or level of health care they do or do not want to receive when they are not able to make the decision for themselves. They also allow for the appointment of a representative who can speak on their behalf to ensure their wishes are properly carried out.
Having a discussion with your parents about their future care, desires, and legacy can seem like an uncomfortable conversation, but it’s one that every family should have before unforeseen circumstances require it. When you follow the easy steps our estate planning attorneys have provided here, your parents, family and you can rest assured you have the peace of mind and security that comes from knowing what your parent’s wishes are and how they will be carried out.
When your parents are ready, our friendly and knowledgeable estate planning attorneys are available to meet with them to provide the legal advice and information needed to develop an estate plan that fits their needs and goals. Contact our office today to schedule a free estate planning consultation today.