Get It in Writing: Why You Shouldn’t Defer Estate Planning

Get It in Writing: Why You Shouldn’t Defer Estate Planning

There are plenty of unpleasant things in life we prefer to not think about. Taxes, for one. Pressing home repairs. And certainly high up on the list is thinking about tying up loose ends in the event of our death.

None of us relish the idea of being reminded of our own mortality. But we put off planning for the eventuality at our own peril. Ignoring the inevitability of our passing doesn’t do anything to change it – and it may ultimately cost your loved ones dearly if you don’t take the time to grapple with the full implications of what your passing would mean for your estate. You wouldn’t be alone; it was estimated in 2014 that about half of all Americans aged 55 – 64 lacked any sort of estate plan, even a basic will.

Their lack of planning poses the threat of leaving their heirs not only with grief, but considerable legal bills in the absence of clear directives on how their estates should be passed on. At a time of such difficulty for your loved ones, do you really want to potentially saddle them with the additional pain of drawn-out legal disputes?

We’ve seen this story play out time and again with high-profile figures, such as the late Oscar winner Heath Ledger. When he tragically passed away in 2008, his will had not been updated in several years – leaving out his long-time girlfriend Michelle Williams and daughter, which ultimately led to a painful family rift as his estate went to Ledger’s parents and sister.

This can clearly be a painful situation for a family of any means. But it’s especially important for higher-net worth individuals to put their fiscal house in order before any unforeseen events, given the added complexity of their finances.

You may have not considered that developing an estate plan now – even if you’re relatively young and in good health – can benefit you in this life as well. Not only does estate planning allow you to develop an effective plan for passing on wealth to your beneficiaries, but it can allow you to optimize your ability to retain a greater proportion of the wealth you’ve earned.

If you’ve ever experienced the unexpected loss of a loved one, you know that it can be a traumatic experience. It can also lead to extensive reflection on how you are spending your time and living your values. It’s natural to reconsider your behavior when you think about how you will be presented in an obituary someday. Like the New York Times columnist David Brooks has written, we often prioritize our “resume virtues” and neglect our “eulogy virtues” – the impact we will leave behind for others to remember us by. It can be an uncomfortable process to reflect on how we want to be remembered and to plan for the day we have departed this life – but it is a necessary part of living a full life, and preparing your family to carry on your legacy. Don’t neglect your responsibility to your loved ones to explicitly state your wishes for your finances in writing.