We polled the Moms of East Texas Moms about what questions they had about Estate and Lifetime Planning. We spent some time with the Davidson Law Group to better understand what it means to plan ahead and why this is so important.
Davidson Law Group is a comprehensive Estate Planning, Elder Law and Probate Law Firm. We take what we call the “Lifetime Planning Process” approach to Estate Planning. Meaning we help families make a concrete, enforceable plan as to what happens to our assets, important decisions and our dependents during a period of incapacity or death. The reason we use the term “Lifetime” is because the needs of families change depending on where they are in life and the circumstances that exist at that time. For example, a family with young children has different planning needs than an elderly couple with adult children. The family with young children need to plan for the care and support of their children in the event of incapacity or death and the elderly couple need to make plan not only for death and incapacity but also a plan for paying for their care in the event a need arises for long term medical care. Both scenarios are very different but equally important.
What are the most beneficial services that you can offer moms and families in East Texas?
No offense to the men out there but I have found in my practice that it is typically the wife or mother that is the driving force behind the family’s estate planning. And what I find that these women are seeking, beyond the creation of a plan itself, is the peace of mind that comes with having a solid plan that reflects the family’s exact wishes. So to answer the question specifically, the most beneficial service that I can provide moms and families in East Texas is to provide the client with answers and creative solutions to address their unique planning needs then to formalize the plan with appropriate estate planning vehicle.
How do I begin the conversation about long term care planning with my parents for their benefit?
There is really not an easy way to approach the topic of long term care planning; however, what I have found is that most people have personal experiences or know someone who has had a personal experience with a loved one that required long term care that they can draw on to understand the dire need to have a plan. Of the many stories that I hear from clients, some are success stories of families who did the appropriate planning before it was too late, but unfortunately the vast majority of the stories I hear are sad stories of families in crisis mode doing their best to navigate the confusing process of trying to provide the loved one with the quality of care they need without going bankrupt in the process.
However, emotional stories aside, when you look at the risk of loss numbers of long term care as opposed to the other risk of loss we typically insure, the needs speaks for itself. Most, if not all, people who have homes insure that home with homeowner’s insurance that will typically cost $1,000 or more a year. However, you have less that a 0.1% chance of experiencing a house fire and if you do experience a house fire, the average loss is less than $5,000. Another example, if you drive a car on public roads you are required by the state to have a minimum amount of insurance on your vehicle and the average annual cost of car insurance is around $2,300. However, you have less than a 7% chance of having a car accident and if you do have a car accident the average loss is less that $7,500.
Now let’s look at the numbers for long term care. You or your loved one have a 60% chance of needing some sort of long term care in your life time and if you do need long term care, the average annual cost of that care is between $50,000 and $120,000. If you are of the 60% who will need long term care, you really have two options. The first option is to spend down your assets to pay for the care until you die or run out of money. The other option is to make a plan ahead of time to protect your assets and to plan for alternative methods to pay for your care. The latter can be done in a simple and cost effective manner through proper estate planning so long as it is done before there is a crisis.
What should be key things listed in a will?
From a personal preference perspective, your Will should always reflect your current wishes regarding the distribution of your assets to the appropriate beneficiaries and should list who you want to serve as your Executor to carry out your wishes after you pass. From a legal procedure standpoint, absent some compelling reason to the contrary, you will want to ensure that your Will contains provisions that will make it as cheap and easy on your Executor and loved ones to administer your estate as possible. For example, you should make sure that your will is attested and self-proved. Simply put, this means that you have signed your will in front of witnesses who attest in writing, among other things, that the document you are signing is in fact your last will and testament, that you are of sound mind, and at least eighteen years old. You may also want to have provisions allowing your Executor to operate under Independent Administration and without bond. This allows your Executor to carry out your wishes with minimal court oversight and without having to secure an expensive and unnecessary bond. Keep in mind that there may be reasons you might want your Executor to serve with a bond or in a Dependent Administration, but generally speaking, these are things we will probably want to avoid.
How do I go about setting up who will be legally responsible for my children if
something happened to my husband and I?
In the State of Texas you can name a Guardian for you minor child either in your Will or through a stand alone written declaration. It is my professional opinion that the use of a stand-alone declaration is a best practice. If you make this designation in your Will, you will first have to go through the process of proving the Will as valid and when it comes to caring for minor children, you do not want the process to take any longer than necessary.
If my parents or I don’t plan now, what costs/issues could we possible see in the future?
The answer to this question really depends. If we are dealing with a young family with minor children, a lack of planning might result in someone caring for your children who might not have been your first choice, your assets being tied up in a probate matter and not being used for the care of your children the way you intend, and if you are a blended family, the lack of planning can be particularly disastrous.
If you are the caretaker of aging loved one, a lack of planning can cause severe financial harm as well as potential and harmful gaps in medical care. As a general rule, it is typically cheaper and easier to make a plan in a time of peace than it is to deal with lack of planning in the middle of a crisis. Keep in mind that when I use the word “cheaper” I am not just talking about money. I am talking about the cost of time, money, emotions, potential strained relationships, among many others as a result of a lack of planning.
Thank you to Davidson Law Group for giving some very good information to think about and for answering our questions. If you have other questions, please reach out to them via their website.
While this is sponsored content, the questions are our own.