The thought of talking with your parents about sensitive topics like finances and estate planning probably makes you want to run as fast as you can. Nonetheless, starting a conversation about estate planning with your parents is an important first step toward ensuring that their wishes are honored and that the right legal documents are in place when the time comes.
“Play hard. Play smart. Play together.”
~Dean Smith, legendary UNC men’s basketball coach.
Estate planning works best as a team effort --- built on trust and shared goals. By planning together, your family can protect assets and help ensure their estate plan remains compliant with ever-changing estate and trusts law. To make sure their plan is comprehensive, consider discussing the following key topics with your parents:
Last Will and Testament
If you discover that your parents do not currently have a Last Will and Testament, it is crucial to talk with them about creating one --- along with other estate planning tools such as a Power of Attorney and heath care directives. If they already have a Will, confirm who is named as executor, and review the Will to make sure it still reflects their final wishes. It is also critical that you take steps to know where the original Will is stored. This is especially essential because laws have not fully evolved to recognize hard copies or electronic copies. Most states still require the original signed Will for probate. If only a copy is available, the process to authenticate the Will can be lengthy and the results are not guaranteed. If the Will is not accepted – your parent’s estate could proceed through the intestate process (without a Will) and all that effort would have been wasted.
Insider Tip: Never remove staples or bindings from original estate planning documents; if you need to make a digital copy, scan them the old-fashioned way by folding back the pages rather than taking them apart, to preserve their integrity and avoid any questions about authenticity.
Trust
If your parents already created a Trust, talk through whether it reflects their current wishes, including the successor trustee. It is also essential to verify that their trust has been fully funded – meaning that their property and financial accounts are titled in the name of the trust. Also, significant life changes may require trust amendments. While you do not need to pry into the specifics of the trust terms, ensuring that your parents and the successor trustee understand their roles can prevent complications.
Pour Over Will
A pour over will is a type of will that works alongside a trust. The purpose of a pour over will is to ensure that any assets not transferred into the trust are “poured over” into the trust upon death. If your parents have a pour over will, confirm that it aligns with their current estate planning documents. Remember your parents do not need to read the documents themselves, but understanding how their Will and Trust work together and where to find them is key to honoring wishes and avoiding any delays later on.
Medical Directives
Confirm whether your parents have a living will (advance directive) and a medical power of attorney, which allow someone to make medical decisions on their behalf if they cannot do so themselves. The pandemic underscored how quickly medical situations can change, making these legal documents more vital than ever. If your parents already have these in place, suggest they talk with their named agent to ensure that person understands their feelings about their end-of-life care, and consider sharing the documents with their medical providers.
Insurance policies
Talk with your parents about what insurance policies they have and where documentation is located. This includes health, life, home, auto, disability, and long-term care coverage. Setting up automatic payments can prevent accidental lapses in coverage, especially during an emergency. It is also wise to maintain a secure record of usernames, account numbers, and passwords so their insurance can be easily accessed when needed.
Financial, Investment, and Retirement Accounts
Encourage your parents to create a list of financial accounts, noting where each account is held along with key contacts. It is also vital for your parents to have a financial power of attorney so that a trusted family member or friend can manage their finances if they are traveling, ill, injured, or simply welcome assistance with day-to-day tasks. Because some institutions require their own forms, your parents need to confirm each bank or investment firm’s power of attorney policy in advance. Keeping this information organized can help ensure bills are paid, investments are monitored, and retirement distributions remain in compliance with current regulations.
Personal Property Memorandum
Suggest that your parents complete a Personal Property memorandum, a document that accompanies their Will or Trust and allows them to specify who should receive their personal items such as family heirlooms, artwork, and jewelry. This list can help prevent misunderstandings and ensure that belongings are passed on according to their wishes. It is also necessary for your parents to clarify when these gifts should be given –– so that sentimental items like Grandpa’s watch, remain where they belong until the right time.
Trusted Advisors
Do they have a list of their advisors, starting with legal and financial professionals with their contact information? At Collins Family and Elder Law Group, we would be honored to serve as one of your family’s trusted advisors. Whether you are ready to schedule a family meeting or need an experienced attorney to review existing estate planning documents, our team will guide you with clarity and care. Contact us today to ensure your family's estate plan reflects your parents’ values and goals.
If you are in need of assistance, the attorneys at Collins Family & Elder Law Group can help.
