We spoke with Daniel Julius, an Estate Planning Specialist at Stock Legal in St. Louis, to discuss what makes a good estate plan and some common pitfalls you can avoid as you think about planning for the future.
Senior citizens are seen as vulnerable but have lived through so much, they are sources of wisdom and insight. I love the part of my job that lets me sit down with seniors and hear all about their experiences and thoughts on the world.
In my career, I am most proud of helping widows and widowers through what is often the most trying time of their whole life — the death of their spouse.
At the simplest level, estate planning is the process of legally empowering people to take care of your assets for you, when you can’t take care of them yourself. This occurs either because you are disabled, or you have died. Trusts, wills, powers of attorney — these are all variations on that theme. They are legal documents which empower other people to manage your finances for you when you are incapacitated or have passed away.
Healthcare powers of attorney are closely related and allow people to make medical decisions for you when you are unconscious or can't make your own decisions.
This is easily the biggest misconception: just having a trust or will does NOT mean you are set! HOW your assets are specifically owned is critically important.
You could have the most beautiful trust drawn up, which perfectly expresses your wishes... and if your trust doesn't own your assets, or receive them upon your death, then it does nothing at all. Your assets MUST be coordinated with your plan.
A good estate plan is downloaded for a couple bucks from the Internet.
The best estate plans are carefully drafted by experienced professionals, based on your specific family and financial life, and then continually reviewed throughout your life to make sure they still fit your wishes and the current laws. In addition, as I said above, it’s important to remember that your assets must be coordinated with these plans.
I see a lot of do-it-yourself-ers come in who have educated themselves all about estate planning by Googling "wills" or "trusts." I am very much in favor of reading, and continually learning, but just be careful with this. What is the source of your information? If you live in one state, but are reading about the laws of another one, that can completely throw off your understanding about the laws that actually apply to you.
Also, putting TODs ("transfer-on-death") on your car and bank accounts may be more risky than you think. The cheapest way is very rarely the best way to do anything and I’d caution against making these choices too quickly without consulting an expert on your specific situation.
The number one thing I hear from seniors is that they want to stay in their home as long as possible. I completely understand that. They want their independence, their sense of place, their memories, their belonging...if you can find a service like Truehold offers, which allows you to stay in your home, I think you owe it to yourself to really investigate and consider that service.
Don't make a decision based on what your sister's husband's friend's financial advisor told them. Get real advice based on YOUR situation.
I cannot wait to begin educating clients on how they can leverage the home equity they have patiently built for so many years into a vehicle that can help them stay put and continue to live where they want to live.
People can contact me at any time. We often get calls when there has been an emergency -- somebody falls, somebody is diagnosed with a medical issue — but there is no reason to wait for that. I think the process is easier if there isn't the specter of a problem floating over your head.