Most estate plan failures aren’t due to flaws in the documents or the strategies.
A high percentage of plans fall short of their goals, and it’s often because the people implementing them didn’t have all the information they needed.
You see, an estate plan covers more than the property you leave to others.
It covers other issues, including your comfort and care late in life. A plan can’t be properly implemented and achieve its goals if those close to you don’t have vital information.
I became more aware of this important issue after taking over the affairs of my aging parents a few years ago.
I’m fortunate, because I became involved while they were still able to help and provide information as needed.
My wife and I frequently say that as difficult as the process of reorganizing and managing their affairs was, it would have been worse if my parents weren’t still living or were cognitively impaired when we became involved.
I regularly meet people who had to handle their parents’ affairs after their parents passed or otherwise no longer were able to help. Frequently, there were additional and unnecessary expenses, work and frustration.
It’s not unusual for assets and benefits to be lost because no one knew about them. The children often become frustrated and bitter, diminishing the memories of their parents.
Most estate owners don’t realize the information others need or assume the others know details they really don’t.
Or people think they’ll have time to communicate the details, but never get around to it.
To avoid all that and more, be sure your spouse, at least one of your adult children and perhaps some close friends or professionals can answer these key estate plan questions.
What is your personal information?
This is essential for anyone who wants to help with your medical care, financial affairs, any kind of personal assistance or administering your estate.
Key information includes your full name (and any previous names), birth date, Social Security number, Medicare number, veterans’ information and anything else along those lines.
The location of documentation supporting this information, such as your Medicare card, birth certificate and passport can be essential. Marriage and divorce records also can be important.
All residential addresses during your adult years and your parents’ full names and any personal information you have about them also can be helpful. All kinds of businesses now are concerned about identity theft and elder fraud and abuse.
To obtain basic information from most businesses or assist in simple tasks, loved ones need to do a lot more than say they are relatives or friends.
Even when I held a power of attorney and was co-trustee of a living trust I had to jump through a lot of hoops before financial service firms and medical providers would recognize my powers under those documents.
Where are your lifetime documents, and what’s in them?
These documents include an advance medical directive or similar document, a durable power of attorney and a living will, if you have one.
People need to be able to locate these documents and know who’s empowered to act under them should you need help.
Having all the right estate planning documents doesn’t do any good if no one knows about them or has access to them.
Part of the estate planning package should be an inventory of your assets, including digital assets.
What is your medical information?
You know the questionnaire you must complete on the first visit to a doctor or medical provider?
All your loved ones need to know that information, such as current medications, full medical history and allergies.
Even those who aren’t empowered to act under your advance medical directive should have access to the information because almost anyone could be taking you to a doctor’s appointment or an emergency room.
The best plan is to periodically update a list of the information and let people know where it is.
Even better is to email it to key people whenever it is updated or store it online in a way that those who might need it can access it.
Many medical records now are online. If that’s your case, loved ones should be able to tell that to medical providers and how the records can be accessed.
What are your insurance coverages?
Medical insurance is the most important for retirees.
Of course, family and friends need to know where your Medicare card is.
They also need to know about Medicare supplement policies, Part D prescription drug coverage, veterans’ benefits, employer coverage, and any other medical coverage you have.
If you’re in Medicare Advantage plan instead of original Medicare, be sure that’s clear to everyone.
Other insurance policies, such as life, homeowner’s, flood, and auto, will be important at some point.
Be sure your spouse, your agents under a power of attorney, executor and successor trustee under a living trust know about your insurance coverage and where to find the policies.
Don’t forget any coverage from former employers, veteran’s programs, credit card programs, and any others you are eligible to receive.
Important estate planning questions regarding your finances:
Which professional services do you use? Who prepared your estate plan? Do you have an accountant or tax preparer? What about a broker, financial planner or other financial services professional?
Loved ones need to know the answers and how to contact the providers.
By the way, the providers also should know the details about your family, especially whom they should contact or expect contacts from when they can’t get in touch with you.
Where do you prefer to live if you need help?
Sometimes, there isn’t much choice, but changes in technology and the marketplace are increasing the living options for people who need some assistance or regular medical attention.
Do you prefer to live at home with visits by homemakers, health aides and nurses as needed? Technology is making it possible for more people to stay at home than could in the past.
Or would you prefer an independent living or assisted living residence, whichever your needs warrant?
Some people prefer the increased social contact and full-time staff of those residences. Ideally, you decide the general area in which you’d like to live and investigate a few alternatives in the area, narrowing down your preferences.
If you don’t do this work and make your preferences known, the decisions will be made by others.
Of course, let those who might make decisions for you know what your plan is to pay for any care you need. Be sure they know if you have long-term care insurance or plan to pay from your resources.
Where are your estate planning documents?
Your executor and successor trustee under a living trust need to know at least where the documents are located and generally what’s in them.
Other family members should know that you’ve prepared the documents and who will be in charge of administering the estate and trust.
What are your preferred final arrangements?
This is one of the issues most likely to cause disagreements among children and other loved ones when you didn’t make your preferences clear.
It is not unusual for one person to remember a casual comment made years earlier and interpret that as a last wish. Sometimes two or more people have contradictory memories about your comments.
This is something you should give some thought, write down any preferences you have and let others know about them.
Your spouse and children need the answers to some of these questions, while only those who will be empowered to act for you need to know the details of others.
Make the answers to these questions available before the need is apparent. You’re unlikely to be able to help provide answers when the information really is needed.
One good way to make all this information and more available is by completing my workbook, “To My Heirs: A Book Of Final Wishes And Instructions.” Click here now to download your copy.