Thoughts On Estate Planning

Plan Now, Not Later: The COVID crisis has only exacerbated a recurring problem we see at the law firm–folks waiting until it’s too late to plan. I always emphasize the fact that you should be in control of your estate plan. It’s not ideal if your adult child is attempting to be the intermediary for your estate plan. In fact, there are ethical dilemmas that attorneys face regarding this very issue. In general, an attorney must make sure that the client’s wishes, not the child’s wishes, take precedence.  Furthermore, an attorney needs to ensure the client isn’t being unduly influenced or pushed to do something they might not otherwise do. So, bottom line, it is really important to plan while you’re healthy and while you can speak directly to your attorney about what you want or don’t want in your estate plan. Waiting until later means (a) you may not be able to plan at all, (b) potential higher chance of conflict and distrust among family members and (c) higher legal costs.

Re-Examine Co-Executors and Co-Powers of Attorney: Are you choosing two people because you don’t want to make a decision or feel like you’re going to hurt the feelings of one? Be very cautious in appointing Co-Executors and Co-Agents. First, there are always logistical challenges with more than one person in a role. Second, what if there is a dispute? Sure, it could be amicably worked out, but take for instance a conflict within the estate, with two Co-Executors at an impasse. The attorney that is representing the Co-Executors now has a conflict. After all, the attorney cannot side with one over the other. So, there is potential for legal costs to exponentially increase, with a situation that could lead to a nasty and protracted battle. Instead, choose someone you trust as Executor and as Power of Attorney. Worried about offending a person by not choosing them? Remember, this is your plan, not their plan. Also, often times a family meeting takes the mystery out of what you are planning, and puts everyone on notice what your expectations are. There is more to be said here, but in general, be very cautious with multiple people in one role. 

Are You An Executor? First, I want to distinguish between being named an Executor and being appointed as an Executor. You may be named in a Last Will & Testament as Executor, but until you are sworn in and take an oath before the Register of Wills in the Pennsylvania county where the decedent resided, you’re not legally the Executor. You’re not obligated to take the role on, even if your name is listed in the will. Before you accept the role, discuss it with an attorney. A common reason not to serve is the estate is insolvent, meaning that all of the assets are going towards creditors and bills. Another important thing to understand for Executors–everything you do is subject to review by creditors, beneficiaries and the court. You must be extremely careful of making distributions early, or paying bills too early. The inclination is always to move along as quickly as possible, but that could be a danger. When you hear estates taking one or two years to administer, it’s not because the Executor isn’t doing his/her job–it’s the opposite. The Executor is doing his/her due diligence to ensure all taxes are paid, creditors paid, and the estate is free and clear for distribution. I would highly recommend always hiring a probate attorney (our law firm regularly handles probate matters) to assist in administering an estate.