Myths About Estate Planning
The first myth to explore about estate planning is that you can do it yourself over the internet. This supposes that a trust is a generic legal document where you plug in names, addresses and amounts you want to give and then off you go! However, experienced estate planning lawyers will tell you the job is ninety percent social work and only ten percent legal.
Most of the time we spend with clients involves going over the social aspects of the estate plan. First, who should be in charge of your legal and financial decision-making in the event of death or disability? One person or more than one? Should they be required to act together or may they be permitted to act separately? How are the other family members going to feel about these choices? Who gets along with whom? What are my options and what do other people do and why? You need to be in a position to evaluate pros and cons and there's no counselling on the internet.
Getting an estate plan from out-of-state is fraught with other pitfalls. Take the New York form of power of attorney. In our experience, even trained lawyers often make major errors in drafting and executing the complex New York form of power of attorney. What chance does a lay person have to get it right?
Then there's the false sense of security one has in believing they have an adequate plan until it is too late – ultimately ending up with the family losing their home and life savings. Why? Because online estate planning does not address protecting assets from the extraordinarily high cost of long-term care either at home or in a facility. This involves planning with a Medicaid Asset Protection Trust (MAPT) -- only available from an experienced elder law firm and not from the internet.
Consider this. Your chance of having your house burn down in any given year is about one in three thousand. Yet who doesn't carry homeowner's insurance? On the other hand, the mortality rate is stubbornly stuck at one hundred percent. Your estate plan for your family, your home and your life savings is simply worthwhile insurance that will one day pay off.