I did not interview Jerry Seinfeld for this article. But I can share with you what he taught me.
I was watching Jerry, the all-star comedian, on television. The program host on an entertainment show asked celebrities about their New Year resolutions. Jerry’s answer was short. It was most appropriate. I am paraphrasing his answer.
“If something needs to be addressed,” Jerry said, “I address it right away. I don’t wait for the New Year to do it.”
This is great advice to apply to your estate planning. Let me tell you why.
Many people never find the time to make a will. They may think it is a chore like cleaning the garage or going to the dentist. However, making a will is the corner stone of your estate plan. Think of it as something you prepare for the people you leave behind.
Let me tell you about Beth. She became a victim because her partner Steven died suddenly at the early age of 54. No one, least of all Steven, expected that to happen. Steven never made a will. He always had it on his “I’ll get to it someday list.”
Almost every week I advise people like Beth. Someone close to them or a family member has died unexpectedly without a will or estate plan.
In Beth’s case, she learned the tragic consequences when Steven died without a will. She now had inherited all of Steven’s family and financial problems.
What is normal?
Normally, a surviving spouse needs time to deal with grief and financial issues. With a will, Beth could wrap up or settle Steven’s estate in six months to a year. In many cases, she would not hire a lawyer. No one needs to go to court.
But that did not happen here to Beth. Steven had no plan and no will for her.
Beth was a common law spouse who struggled with Steven’s adult children. She had trouble paying bills. She ran out of patience and money. The stepchildren wanted to know why Beth did not sell their father’s home. They wanted their inheritance. They saw a sale of the house as the quickest way to get it.
Beth and her bad news
I had to give Beth the bad news.
Since Steven had no will, his estate work will take longer. That means more delays and increased costs. It may take 2-3 years or more to wind up his intestate estate.
I had to ask Beth if she could afford to pay the mortgage, insurance and property taxes on the house. If not, how was she going to continue living there?
“Beth, you may need to go to court for financial assistance to pay bills. Steven’s children do not want you to use their father’s money to live in his house. They want you to move out so they can sell it. They do not trust you to do that.”
Beth wanted to know if she could use Steven’s money to pay bills.
“Steven does not have a will. He has no estate executor to handle his affairs. You need to agree with his children who will handle the estate. Since no one is named as Steven’s executor, the court must appoint one. Until someone is appointed you cannot access Steven’s investment accounts.”
I explained that the children and the ex-wife will each hire lawyers. They will all want a piece of Steven’s estate. Even if everyone agrees this could triple the legal costs. There could be a lawyer for each of the 2 children, the ex-wife and for Beth.
Not everyone may then agree. They could argue about who should be in charge of the estate. The legal costs would then increase tenfold. Instead of $10,000, each lawyer could cost the estate $40,000 in extra legal costs. You could see this number multiplied 10 times if everyone went to court more than once.
Who pays for Steven’s failures?
Everyone suffers differently because of estate delays.
And who pays for the legal trouble?
The court would say Steven created these legal problems. He failed to make a will and name an executor. Steven’s estate will bear the legal costs because he did not have an estate plan.
You do not have to be rich
Estate planning is preparation. Everyone needs to prepare for the inevitable. You have to prepare a plan for the people you leave behind.
Make sure you get legal advice to make the right choices.
Don’t wait for next year to make a will.
The problems Steven created can take years and cost a fortune to resolve.
If you love your family, take Jerry Seinfeld’s advice.
Don’t wait to make your will. Do it now!
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 Law. Ed’s law firm website is MrWills.com © 2014