The core of Estate Planning is the life of each human being. Do you recall the process that ultimately led to the completion of your estate plan? You asked a question or voiced a concern about estate planning. Do I need a living trust? Will my estate pay a lot in taxes at my death? Can I avoid probate expenses?
The response to these questions triggered a recommendation to complete or update your estate plan. Now recall what happened: In nearly all instances, you were asked to gather your account statements, deeds, insurance policies, bank books, security certificates, loan agreements, benefit plans, tax returns, wills, and any other documentation that pertained to your estate. You carried your numerous papers to “the meeting” and piled them on the desk. This was the beginning of the process to initiate or update your estate plan. Next, you were asked: beyond yourself, are there others you want to care for? There probably was a discussion about taxes, probate expense and other technical issues. Ultimately, documents were drawn and executed; some account titles were changed, and investments in portfolios were rearranged. Perhaps, life or liability insurance was purchased.
Does this description of the process match your experience? So what is missing? It may be you. When you piled the statements and documents on the estate planner’s desk at the “inventory” phase, did you get the feeling that there was more interest in knowing “what you have” instead of “who you are”? Blame it on the emergence of computers in our lives, the general public has been told that all their money issues can be solved through a myopic focus on mathematics. Take your estate value, plug in the tax tables, run your portfolio through an optimizer, add some life insurance, and here is your estate plan. No question, quantitative data is needed in the planning process, and the computer can do the math. It can add up the numbers but it cannot give the most important sum total of you, the person. This requires an open dialogue with your estate planner.
The core of the estate planning process is the life of a unique human being. Assets are merely a means to an end; therefore, a successful plan will merge money with life goals. Estate planners must identify “total personal inventory” and merge your most important life goals with your estate?
Consider the following concepts:
All inquiries in estate planning have financial implications that guide the plan design; without an honest and personal dialogue, your life goals happen by default instead of by design. If you proactively address your estate planning needs, you can create a wealth of peace of mind knowing you have provided as you wish for your beneficiaries.