Thai Food, Pierogis and Estate Planning

While we don’t go out as often as we’d like, my wife and I do enjoy a nice quiet evening (translation: no kids) out once in a while.  Like most folks this typically means heading out to a restaurant for a good meal.  Invariably, the toughest part of our evening is perusing the multitude of options on the menu and trying to decide what sounds especially appetizing.  Of course with my unsophisticated palate, I typically have to ask the waiter or waitress for definitions of some ingredients listed in the entrée description.

But one rule-of-thumb I always try to employ has never steered me wrong when trying to decide on what to order:  always pick something that aligns withpierogies the restaurants’ specialty.  Quite simply, this just means ordering a nice pierogi plate if we’re at a great Eastern European ethnic restaurant or a pad Thai at a Thai place.  There’s usually a reason the owner hired a chef that knows how to excel at that very specialty for which the restaurant wants to build or maintain its reputation.  And that chef usually knows all the tips, tricks and nuances for that specialty which can make all the difference between a great meal and a so-so meal.

Interestingly, I’ve seen the same dynamic play out when I help clients review or establish estate plans.  (Disclaimer:  I am NOT an attorney, nor to I draft documents or give legal advice.  I simply discuss the basic needs, engage a qualified attorney for legal work and ensure the legal side aligns with the financial big-picture).    Over the years, I’ve worked with everyone from “high-end” clients (and attorneys) with complicated estate planning needs to younger couples just starting out with the basics.

What I’ve discovered is the restaurant rule applies here too:  It pays to choose a “specialist” as estate planning can get very complicated, very quickly.

Now there are many attorneys who can legally draft estate planning documents like wills, trusts, durable (financial) power of attorney, living wills and health care powers of attorney.  But I’ve seen many attorneys offer estate planning on the “menu” alongside many other services such as divorces, DUIs, personal injury, etc.  While there is nothing legally or ethically wrong with this, I believe estate planning is best suited for a specialist.  Done correctly, estate planning requires attention to detail, experience and a broad perspective on many of life’s contingencies. But I can usually spot an attorney who “happens to do estate planning” by what look like boilerplate documents.  To me, it looks like the attorney pulled up a Word Doc template on which they just changed the names and addresses, then printed them out alongside their bill.  But the stakes can be high regardless of the amount of wealth as folks with anywhere between $500,000 to well beyond $10,000,000 in assets could end up with documents drawn up that do NOT align with their wishes.  This could mean an estranged son-in-law or some out-of-touch relative could unknowingly inherit assets intended for someone else.  It could also mean a monster estate tax liability, in some cases.  Of course, what usually comes next is hurt feelings (best case) and/or massive lawsuits (worst case).

So I’ve read enough estate planning documents and been in enough meetings to ask questions that my clients’ nor, it seems, their attorneys considered.  When a Certified Financial Planner® who never took a single legal class is finding holes in estate plans, it’s pretty obvious the attorney doesn’t specialize (or doesn’t care) and that’s big red flag. In these cases, I always recommend we engage an attorney who specializes in estate planning.  Of course engaging a specialist may cost a little more up front.  But when one considers how much can be saved in the form of hard dollars (legal, taxes, etc.) and family relationships, the investment is well worth it.

To me, it’s the equivalent of a Thai restaurant that offers pierogis.

Nothing against Thai chefs (I happen to love that food) but do you really think they could pull that off?  Probably not.  Engaging an experienced estate planning attorney who specializes in this area of practice, I believe families can avoid the potential for severe “heartburn” when it comes to efficiently and effectively settling an estate.

Bon Appetit!

The Gift of Planning

I recently experienced a strange coincidence which I view as a case of divine providence.  In late December, I took on the responsibility of helping an elderly friend of the family (not a client) with serious health concerns deal with many day-to-day financial and other issues.  Within a week of this undertaking, I was also coincidentally made aware of a book called “Being Mortal” by Atul Gawande, a physician who delves deeply into the complicated topic of the helping terminally ill patients best handle their final weeks or months of medical care.  I am just about finished with the book and I highly recommend it to just about anyone who is presently or will eventually have to deal with these mortality issues themselves or with a loved one – which is to say, everyone.

Needless to say- I’ve really been an uplifting guy to be around these last months…..  Sarcasm aside, my on-going experience with our family friend and the real-world scenarios described in the book really coalesced to teach me a valuable lesson about just how important proper planning is not only to the person who could be facing the end of their life but also, to the people helping them in their final months or years.

In short, even in the most comfortable of financial situations, there are still seemingly endless details involved with helping a friend or family member continue to operate their financial lives.  If we add the complexity around how to pay for care, the variables increase exponentially, multiplying the stress level for all involved.  Which leads me to my point:  our diligence in planning for our own end-of-life is not for us.  Instead, it is a gift.  A gift we give to those helping us navigate the sometimes heart-wrenching final days.

This is something I’ve conveyed to clients as we review or initiate estate planning (with an attorney of course) but a topic I never fully appreciated until I had to live it myself.  Now I am fortunate in the scenario I’m helping facilitate.  Without disclosing too much personal information of our family friend, I’ll just say he has diligently planned for handling this type of scenario both financially and operationally.  But – even with his detailed diligence, there is still much to do.

Bills need to be paid, mail processed, facilities researched, income taxes filed (by his CPA), prescriptions filled and loved ones need to be kept informed of his condition.  So I can’t imagine trying to help with all these duties PLUS trying to figure out how this will all be paid for or trying to interpret medical directives based on conversations alone.  This would be overwhelming but fortunately can be avoided.  How?  Taking the time for proper planning of course.

In my mind, there are three main areas to address – each of them requiring diligence and time & effort to implement.   These are:

  • Having the proper estate planning documents in place: These typically include a will, health care power of attorney and could include a trust or living will.  I am not an attorney so I am not giving legal advice but I can convey the importance of these documents, prepared with by competent legal counsel.  This is well worth the investment of time & money as it eases the burden of your family having questions like: “what would Mom want us to do?”
  • Mapping out a plan for financing long term care: Of course having lots of money solves this but most folks don’t have endless financial resources.  Realizing this, proper planning for long-term care using long term care insurance could be a useful tool to help pay for what are very expensive services.  I don’t sell any kind of insurance (or any other products) but long term care insurance is a specialty unto itself and for this reason, I pull in insurance pros who know the details when I help clients address this need.  But the important point is, with solid long-term care in place, the people being protected are not only those undergoing the medical care but also their loved ones.  Trying to setup and facilitate long-term care in the home of the elderly parent or in the home of the son or daughter is extremely stressful and time consuming.
  • Having your documents, passwords, bank accounts and processes documented: This is the most under-appreciated part of the plan as we all have innumerable touch-points up in our heads that our extended family and maybe even our spouses don’t know about. Examples include:  how the bills are paid, how the checkbook is reconciled, what accounts we own, email and website passwords, who owes us money, etc.

Handling these three topics before we need the care is so easy to push to the back burner of life. Plus let’s be honest, it’s is not fun for anyone.  But reading the aforementioned book drove home a key point:  Even the best of end-of-life situations are littered with at least some gut-wrenching and stressful medical decisions.  This is enough stress for any family to endure.  Adding in complexities and stress associated with financial and legal issues would certainly be overwhelming and a burden no one wants to bear.

We all have to face mortality sooner or later either indirectly with a loved one or directly ourselves.  But take it from a guy who deals with investment of financial assets all the time: putting in the time in effort to properly plan for care as we age might be one of the best investments we can make.