Discussing (much less planning for) your own mortality can be understandably uncomfortable, but it's also crucial and inevitable. This is part of life, and for your own sake and your family's, estate planning can make all the difference.
There are people available who work to facilitate these conversations and make them easier, whether it's legal experts guiding you through planning or community groups like The Mortals Café in Grand Rapids, which offers tons of resources around estate planning, death doulas, hospice care, grief and more.
Depending on your personal financial and familial situation, your estate planning could be quite simple or surprisingly complex. That's why we talked to Linsey Gleason, Partner at Varnum LLP.
"The time it takes to put together an estate plan is largely dependent on how complex each individual's needs and desires are to document," Gleason said. "Sometimes an estate plan can be very, very simple, but some plans (like those for blended families, families with special needs children, etc.) require more thought and more complex solutions."
As Gleason says, "An estate plan is more than just documenting instructions for the distribution of our assets when we die (I have some clients who say if!)." Estate planning covers a range of considerations, including:
- End-of-life care, including a health care proxy and living will.
- Picking your executor of estate.
- Which individuals receive money, and how.
- Which charities receive money, and how.
- Tax planning.
- Real estate documents.
It may seem like a lot of decisions to make, but they're important decisions, and you should feel empowered by the control estate planning gives you over the situation.
Unless you're overwhelmingly wealthy, the mechanisms for estate planning aren't too complicated to understand, but it's smart to learn the basics. For instance, most people know what a will is, but what about a trust?
"A trust is sometimes called a 'will substitute,' but it can be much more than that," Gleason said. "A trust can provide the added benefit of avoiding the necessity for probate after death. For some, particularly the wealthy, trusts can be leveraged for significant tax benefits. Trusts typically provide far more flexibility, and also more control in the administration of assets."
Often, you'll use a combination of the two, with the will specifying where tangible property goes and the rest of your estate passing into trusts. A trust simply holds assets for a beneficiary, and you, the grantor, outline what terms these assets are distributed in.
Regardless of your mechanisms, one great reason to start estate planning now and to do so with an expert is to help avoid potential rifts in the family after you're gone.
"Even the perfect estate plan may not guarantee that a family won't argue after death, but a well-drafted estate plan can clearly document your intent," Gleason said. "In most cases, your estate plan will dictate who will be placed in various fiduciary positions on your behalf, eliminating court involvement and potential arguments over who may be best suited to play various roles. In addition, your estate plan can include provisions (like no contest clauses) that disincentivize anyone from trying to challenge the terms of a will or trust."
With all these factors at play, you might be putting off estate planning just for fear of the hassle. However, it's a crucial part of life, and you don't want to wait until it's too late. The earlier you begin, the easier it is.
"An estate plan is an opportunity to plan and leave a legacy," Gleason said. "Your legacy might be in caring for your loved ones after you're gone, or leaving resources for a favorite nonprofit organization (or both!). Estate planning is even more important for individuals and families with young children or those with special needs."
Ultimately, Gleason notes there's no one-size-fits-all estate plan.
"The cost may be more for individuals in blended families, with special needs children or with complex assets, like closely-held businesses," she said. "You might expect to spend $3,000 to $4,000 or more on an estate plan, but it's a smart investment in you and your loved ones' futures, and often costs far less when done correctly and timely as opposed to the process that has to be undertaken for a person who becomes incapacitated or dies without an estate plan."
Written by Josh Veal, Contributing Writer for West Michigan Woman.
This article originally appeared in the Apr/May '23 issue of West Michigan Woman.