How Estate Planning Can Prevent A Civil War In Your Family

When it comes to the topic of their own demise, people like to change the subject for some reason.

That may be why it’s so easy for so many to put estate planning on the back burner. Unfortunately, this is often the first step on a path filled with frustration.

In my experience, the most common reason parents don’t get wills is because they cannot agree on guardians for the kids. New York and Connecticut have schemes for what happens to orphans, but you are likely to know your kid better than the state. With a will, you can bestow custody on whomever you wish, regardless of the state’s “default” setting for orphaned kids.

A will can also be used to influence the amount of tax the estate and the heirs pay. It’s typically the role of an attorney or accountant to know the applicable rules and stay on top of new ones — and with a tax code in flux, they’re usually worth every penny.

Some people opt not to make a will because all their assets are in instruments that have named beneficiaries. Things like brokerage accounts, retirement accounts and life insurance completely bypass the will, and a lot of people like it that way. What they’re not grasping is that most of the acrimony that arises from distributing an estate happens over sentimental items. Without a will bequeathing each trinket to a specific person, you can be all but sure that there will be a battle royale in your honor.

Others put off making a will because they do not have anyone to be the executor. Being the executor of an estate can be an enormous amount of work, often involving getting sued and suing others. Many people just don’t want to put someone they love through all that. You can always have your attorney or another trusted professional serve as executor of your will, which would also mean it’s being safely stored.

Lastly, some people just don’t want to think about anyone’s death, let alone their own. I don’t have any specific advice for this, other than reframing it as a quality-of-life issue for your heirs or a legacy question for you. Do you want your heirs to sue each other? Do you want to be remembered by the lawsuit over your estate?

No matter what your motivations are, it’s a good idea to go into an estate-planning meeting with a working knowledge of your finances, especially your net worth, which is your assets minus liabilities.

Your assets are anything that you own that has a cash value like investments, bank accounts, brokerage accounts, retirement accounts, real estate, personal property and cash.

Your liabilities are your loans, mortgage, credit card and other debt, medical bills or student loans.

The inconvenience of going to court and the expense of hiring an attorney are nothing compared to the emotional toll that dying without a will has on the survivors. Families strain under the heavy responsibility of dealing with an unplanned estate. It’s tragic, so avoid this by having all your ducks in a row.

Judy Heft is the CEO/founder of Judith Heft & Associates, a financial and lifestyle concierge firm celebrating 25 years in business helping people stay financially organized. She is a certified money coach and the author of “How to Be Smart, Successful and Organized with Your Money.” For more information, visit www.judithheft.com.