Top Ten Estate Planning Issues

PRESENTED BY STEVEN D. SPILE AND GARY N. SCHWARTZ

1. Throughout our lifetimes, we work hard to accumulate our assets. Without a proper Estate Plan, a substantial portion of our assets may be lost to taxes, attorney fees, and probate costs. These losses can be minimized or avoided by the use of various Estate Planning devices.

2. The value of our assets are often underestimated. This is especially true in California where the value of our residences are currently projected to be in excess of the amount at which point our estates become taxable. This does not even consider the other assets we may have. A proper Estate Plan can shield a significant portion of our assets from taxes.

3. Beyond the risks of erosion of our assets, the lack of an Estate Plan can result in our assets going to unintended beneficiaries. The only way to assure our assets go to whom and in the manner we want them to be transferred is through an Estate Plan which specifies the details. This is particularly important to prevent the squandering of assets by an irresponsible heir.

4. The Lack of an Estate Plan often leads to dissension, battles and permanent scars among the various beneficiaries of an estate. There are few things which are more unfortunate than to consider that the ones we love the most may become entrenched in lifelong bitterness because we did not clearly specify how we want our assets distributed.

5. The lack of an Estate Plan often leads to long delays in the ultimate distribution of our assets. Sometimes, these delays can be measured in years, during which time our assets are in essence frozen and may very well diminish in value.

6. The lack of an Estate Plan frequently attracts people who see the situation as an opportunity for exploitation. Even those with commendable intentions are limited by a system which tends to be cold, indifferent and unyielding to the human issues faced by our beneficiaries.

7. Estate Planning also provides a vehicle for us to set forth how, and by whom, we want our finances handled should we become incapacitated.

8. In addition, should we become incapacitated, without a proper Estate Plan, we have left no directions about our treatment. As a result we may be treated in ways that are contrary to our desires. For example, we may be taken off of or kept on life support systems despite a different preference. Further, the burden of making these very difficult decisions are left on our heirs who may struggle the rest of their lives with whether they made the right decision.

9. Most of us intend to have an Estate Plan, but put it off for another day. As days become months, and months become years, too many of us pass or become incapacitated without an Estate Plan. Such delays only create the risk that our time will come before we Planned.

10. Of critical concern is the fact that the laws regarding what portion of an estate are going to be taxable has been scheduled to go through a number of changes over the next couple years. As a result, the timing and structure of an Estate Plan will have a substantial impact on how much of our estate may be lost to taxes.