Estate Planning as a Career

Estate – Don’t Be Left Holding The Bag

Ned almost lost the farm that had been in his family for 8 generations! Weve all heard that “The Devil is in the details”. It is especially true when it comes to estate planning. Make sure you dont make the same mistake Ned did.

Ned and Nellie Mae were in their early 80s. Even though they had been happily married for over 30 years, they each had children from a previous marriage. About 10 years ago they became concerned about the amount of estate taxes that would be due on the family farm when they died. Theyd heard the nightmare stories about losing the farm to Uncle Sam and they wanted to make sure it wouldnt happen to them!

So Ned went to see his local attorney. He told the attorney about their estate tax concerns and also that he wanted to make sure the farm went to his childrenstayed in his familyinstead of going to his stepchildren when he died. Well, the attorney told Ned what to do and, obediently, Ned and Nellie Mae implemented that plan over the next 9 years.

Thats when I got involved. The attorneys advice sounded good, but the Devil is in the details! And the attorney missed a few details that left Ned holding the bag.

The result was that if Ned had passed away, his share of the farm could have gone to his stepchildren instead of his daughtersthe very thing he was trying to prevent!

The attorneys plan was also supposed to reduce the amount of estate taxes that would have to be paid, but because the attorney missed one small detail it would be as if the plan had never happened, leaving a $750,000 tax bill! They followed a plan for 9 years and were right back where they started!

Fortunately, I was able to help Ned and Nellie Mae get the chaos that had become their estate plan quickly and easily sorted out. With the help of a competent attorney, Ned and Nellie Mae now have the peace of mind that what they want to happen, will happen.

Their estate taxes have been drastically reduced, possibly even eliminated. Just as important, Nellie Maes children will get her portion of the estate and Neds children his. The farm that has been in his family for 8 generations will stay that way for a few generations more.

To their credit, Ned and Nellie Mae did everything they were supposed to. They were proactive in recognizing that they needed to take action to reduce their estate taxes. They knew they needed legal documents in place to dispose of their estate according to their wishes, minimizing any conflict between the children.

They sought out an attorney to help them. They followed the attorneys advice and did what they were supposed to. So what went wrong and how can you avoid making the same mistake?

The only mistake Ned and Nellie Mae made was not working with an attorney that specialized in handling complex estates. Their attorney was a generalist. Being in a small town he did a little bit of everything, legally speaking.

Just like in medicine, it is hard for any attorney to be an expert in all areas of the law. You may have a family doctor, but if you need a heart transplant they will refer you to a cardiac specialist. If you have severe foot problems they will refer you to a podiatrist. If you have hemorrhoidswell, never mind, you get the picture!

Ned and Nellie Maes attorney knew in general what they should do, but since he wasnt an expert in the area of estate planning he missed a crucial detail.

Its the same way when it comes to handling all of your financial affairs. For all but the simplest cases, you should be working with someone who specializes in the areas you need help. For instance, I specialize in Estate Planning, Insurance and Investments for affluent seniors, retirees and near-retirees. Others specialize in company retirement programs, etc. Work with a competent professional that specializes in your situation.