If you and your family are among the many millions of Americans who have not yet figured out how to pass your assets to the next generation (aka estate planning), try taking some creative inspiration from the animated film, Encanto. Here is encouragement from an estate planning expert.
Leaving A Legacy
Even modest gifts can be life changing to future generations, whether left to our own families or given to organizations doing work that matters to us. Thoughtful estate planning also benefits families by reducing the decision making that must be done upon a death in the family, interfering with grief—and even seeding conflicts. Drawing on the film Encanto, estate planning attorney Davis Schilken, offers these insights to families:
- Leaving a family legacy is important and can have an impact beyond your immediate family.
- Be sure to consider the significance of multigenerational planning.
- Treating each beneficiary as a unique person is essential.
- Naming the “strongest” child as your fiduciary may not always be the most sensible decision.
Appointing a Representative—Thoughtfully
Among the many decisions we make when working on an estate plan is: who will carry out our intentions and wrap up our affairs when we die? The terminology for this role differs a bit by region and circumstance. This designee might be referred to as a personal representative (somewhat of an umbrella term), executor, administrator, fiduciary or trustee. Regardless of the nomenclature, serving as a personal representative is not a ceremonial honor—a commitment of time and diligence is necessary. Lawyers remind us that it can take up to 18 months to settle an estate (though expedited state probate processes can help). There are forms, deadlines, and to-do lists to attend to when a loved one dies. Even fairly ordinary tasks like cancelling the utility bills require careful attention. As law experts remind us, don’t leap to the conclusion that the “strong one” in the family is best suited for this role:
In Encanto, Luisa is the physically strong sibling. Most families have the characteristically “strong” child who takes on most of the responsibility along with most of the pressure. It is natural to appoint this responsible child as the trustee, the agent under a power of attorney, or in another fiduciary role in your estate plan. Yet, just as Luisa sings, “Pressure that’ll tip, tip, tip till you just go pop,” sometimes we, too, assume that the “strong” or “responsible” one can continue taking on more responsibility. Think twice about whom you appoint as a trustee or fiduciary because that person might just be at their breaking point; maybe that responsibility is a load that can be shared.
Good To Know: Fiduciary
Despite the terminology subtleties and regional variations, personal representatives, executors and administrators share a common legal duty: they are fiduciaries who must avoid self-interest while acting in the best interest of the estate and its beneficiaries, in accordance with applicable state laws. Given the significant trust placed in fiduciaries, they are often required to secure bonds guaranteeing their faithful performance. As a leading national bond provider, Colonial Surety helps fiduciaries including, personal representatives, executors and administrators in every state quickly and affordably obtain their bonds. The steps to obtaining a bond with Colonial are easy: get a quote online, fill in the information, and enter a payment method. Print or e-file the bond from anywhere, anytime.
Acknowledge Unique Family Members
Although the entire soundtrack of Encanto went viral, one song, “We Don’t Talk About Bruno,” struck a particularly big chord, perhaps because it reminded us about family members we may be reluctant to talk about. When it comes to the estate plan, however, it’s important to consider this expert advice:
There may be members of our own family whom we are reluctant to talk about—perhaps the one who is an embarrassment to the family because they have not lived up to expectations or followed societal norms. Still, we need to acknowledge that family members come in a lot of different flavors and be willing to recognize the good and potential in each of them, even if they do not fit the mold. Likewise, you should tailor your estate plan to fit each beneficiary’s individual needs. For example, an incentive trust or special needs trust may make sense for some beneficiaries to help them reach their potential, but it may not make sense for others.
Learning about different types of trusts is another helpful step to take during estate planning. The more you know, the better you can plan—both for your own later years and potential loss of capacity, and the needs of those you care about, including family members with special needs. Whatever you decide in conversation with your family, try to get going. Plans are unlikely to be perfect, but, a proactive estate plan that attends to our own needs while setting off a spiral of good for those we care about is a beautiful thing.
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