As Ben Franklin so famously said in 1789, “…in this world nothing can be said to be certain, except death and taxes.” No one likes to deal with either eventuality, but estate planning exists to deal with both of them. Estate planning is more than deciding who gets one’s worldly good and when. The psychology of estate planning has two sides: first, the psychological issues that can impede someone from engaging to make a plan, and second, the issues that a good estate planning attorney should be focused on so that the estate plan fits the client’s overall needs, not just the tax angles.
From the client’s perspective, it is natural to avoid those things that make us uncomfortable or to feel intimidated by things we don’t fully understand.
- fear of planning for fear of hastening one’s death
- Inability to decide who should take charge as agent with a power of attorney, executor of a will or successor trustee of a trust
- Inertia in assembling the documents that an attorney wants to see
- Unwillingness to grapple with end-of-life medical decisions
- Experience in handling a parent’s estate
- Distaste toward paying an attorney to prepare documents that can be done online for a fraction of the cost
An attorney may decide that his training is in law, not psychology, and thus decline to deal with the issues impeding the client. A good estate planning attorney knows that family dynamics are a key aspect of estate planning, that it is important to establish good communication with the client and that he must explain the options and what each can accomplish. The objective is to improve both the experience and the outcome.
The attorney needs to recognize the issues and educate the client:
- Being an executor is a job, not an honor
- If the children do not get along well, making four of them co-executors will not improve the situation
- Without a will, the state has a plan for distribution of your worldly goods, and it is based on equitable, not suitable, distribution to the statutory heirs
- Divorce does not break the beneficiary designation on a retirement plan
- Without a will, children from a prior marriage will receive 2/3 of the decedent’s estate
- Sometimes a corporate trustee is a better choice than leaving decisions in the hands of one heir
- There are options to avoid making a disabled heir ineligible for public benefits that are better than giving the full inheritance to another child
- Are children being treated fairly or just equally?
- Preventing a surviving spouse from spending all “my money”
- Diagnosis of a terminal illness requires special planning
- Family business issues when not all the heirs are involved in the business
- Planning now makes the work of your heirs that much lighter
The attorney needs to explore the issues in depth, explain the options and do so without using jargon or tax language to explain obscure concepts. Draw pictures if necessary. A good estate planning questionnaire will have questions to bring out these issues of family dynamics and prepare the client for discussion. The end result is not just a stack of signed estate planning documents but relief that the issues have been raised and solutions are incorporated in the planning.
