More Real Reasons Not to Do Any Estate Planning – Part 2Ed Olkovich
Think you have good reasons for not making an estate plan?
You may have reasons that raise legitimate questions. But sometimes a reason is an excuse to avoid making decisions.
Let me help you overcome your excuses. I’ll give you answers to help you protect your family and act.
Excuse 4: Making a will is scary… I’m afraid of making a mistake.
“Online will forms are confusing.”
“I want to use a will kit but I don’t know what kind of will I need.”
“I am afraid to spend money on hiring a lawyer. I want to save money.”
“I can wait until I really need a will.”
Answer: Why do you have a spare tire in your trunk? You really don’t need it until you have a flat tire. But every car has a spare tire for a reason; you need protection. You need it in case an accident happens. Invest in a lawyer-prepared will. The protection is pennies a day. I tell everyone that you can find a lawyer in every price range. Most do-it-yourself wills usually lead to complications never intended by will makers.
Excuse 5: I’m afraid to talk about money with my family.
“I’m afraid this kind of talk will only start an argument.”
Answer: You may be right. Money is a taboo subject in many families. This risk may be worse with a blended family. There, competition for attention and money can generate Oscar-worthy performances.
A lot of financial writers advocate open money discussion.
My answer to that advice is every family is different. I understand why some clients want to avoid the subject altogether. When someone in a family dies, the disruption changes lives. Families often need lawyers because they could never talk to one another.
Excuse 6: I don’t know what will happen to my business if I die.
“Who will run my business if I die?”
“Will my partners have the money to buy my share of the business?”
“Do I need a shareholders agreement with insurance to provide for my family?”
Answer: You need a contingency plan even if you don’t have a succession plan. You will want powers of attorney for property. You can designate someone to control the business bank account if you are a sole proprietor.
Are you running a small business by yourself? If you die without a will, your business account will be frozen. No one will have authority to even draw money out of the account.
You can set up a trust or a will to deal with your business. Give your trustees power to operate the business until it is sold.
Use an estate plan to reduce taxes from the sale of the business. That leaves more money for your loved ones.
Excuse 7: Everything in my life keeps changing.
“I can’t keep up with my children’s needs, money for school or their marriages.”
“I’m still paying for my divorce.”
“I don’t know if my new relationship will work out.”
Answer: Estate plans are not cut in stone for a reason. Things change. Every time your relationships, assets and beneficiaries change, you must update your plan. It may be a simple and inexpensive change. You may need to change the beneficiary of your life insurance, RSP or pension plan. You can do this without any expense.
Remember, estate planning is what you do for loved ones you leave behind. Read the 7 Keys to Successful Estate Planning here.
Edward Olkovich (BA, LLB, TEP, and C.S.) is an Ontario lawyer, nationally recognized author and estate expert. He is a Toronto based Certified Specialist in Estates and Trusts. Edward has practiced law since 1978 and is the author of seven estate books. © 2013