Are You "All Set?"

By Dave Zumpano, Estate Planning Law Center

I hosted another workshop recently and I began as I always do, asking the audience, “what do you want to know?”  All types of questions came, including how to protect assets from nursing homes, what is a trust? The difference between revocable trusts and irrevocable trusts, how a power of attorney works, what is the difference between a healthcare proxy and a living will, and of course, the most asked question, “how do I qualify for Medicaid to pay if I need a nursing home?”  These are all great questions, but by the time we finished the workshop, the biggest realization of the participants was that they are not “all set.”

Most of the thousands of people I have seen over the years believe estate planning is as simple as having the right will, healthcare proxy, power of attorney and, if you have enough money, a trust.  This is far from true.  The reality is, the documents themselves only grant authority; they rarely provide the necessary instructions to yield the results actually intended.  The key to an effective estate plan is to grant authority to the people you trust, but more importantly, to ensure your documents provide sufficient instructions to become your "voice" when you are unable to speak for yourself.  Too often, individuals are caught up in a quick fix after sitting with a lawyer and then feel better and think they are "all set". 

Let’s take a healthcare proxy for example. I ask attendees “Where do people typically get healthcare proxies?” The overwhelming response is “the doctor,” or “the hospital.” I quickly respond, “Right, after the workshop, hang around, tell me your ailments, and I will write you a prescription.” The audience laughs because they know it would be crazy (not to mention, illegal) for me, the lawyer, to write a prescription – and then I ask, “Why would you go to a doctor or hospital for a legal document?” And reality hits them, especially when I spend the next fifteen minutes explaining what a healthcare proxy is and, more importantly, why many fail when actually used.  Unfortunately, by the time my workshop is over, rarely do people feel all set. In fact, they usually feel frustrated because the true essence of estate planning was never really explained to them and they discover the documents they have are not their voice.

Another frustrating discovery for participants is learning the rules the State has in place that can significantly hamper their goals. Even when they have documents in place meant to avoid the government rules (legally), they rarely work because the “documents” are not integrated into the other areas of their lives. For example, they learn having a Trust is not enough even if you put your “voice” in it, it’s still not enough without integrating the legal plan with their financial assets and their appropriate family members. All is required, or none of it works!

The good news is, when the participants finally understand how estate planning actually works, they are empowered to stay in control rather than have to rely on misinformation. So, are you “all set?” To ensure you are, you need the correct legal documents, with your voice, and integration of the legal documents into the other areas of your life so your estate plan actually works.

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