What is Estate Planning and How Do I Know I’ve Done it Properly?

By Dave Zumpano

Proper estate planning comes down to three things. 1) you have to have legal documents in place that authorize others to act for you; 2) you have to ensure those legal documents provide instructions of whom you want to get your stuff, when and how. 3) all of this, when done properly, should happen without unnecessary costs or delays.

Then there are wills, health care proxies, powers of attorneys, revocable trusts and irrevocable trusts.  The bad news? It doesn’t really matter which documents you have, because most of them don’t work when expected, the way you thought.

Why?

A Washington State University study shows that only 4 percent of Americans have an estate plan that actually does what they thought it was going to do. The reason this happens is because the estate planning legal documents typically don’t have your instructions. They have the government’s instructions or they have your attorney’s instructions.

This is an important factor in insuring that your plan accomplishes what you want it to. When you put these all together, by having the documents with your instructions, it avoids any unnecessary costs or delays, including family fights and government interference. To ensure your estate plan works, you need to know what you want to have happen at each event in your life, and who you want to be there to control those situations. You also need to understand the different legal documents and determine the best ones to accomplish your goals. And finally, you need to be clear how your personal instructions are integrated into the legal documents and other areas of your life to ensure that your plan actually works.

David J. Zumpano is an attorney and a certified public accountant (CPA). He operates Estate Planning Law Center. He can be reached at 315-793-3622.