COVID Underscores Need For Estate Planning

COVID-19 has upended everything we know. The plans we had for our lives and our families are in limbo, but there is one thing we can control, and that’s having a plan, specifically an estate plan. Having one keeps important decisions in our hands and reduces the difficult decisions your family will have to make. Otherwise the State handled our ultimate wishes!

You don’t want to think about it. No one does, but COVID-19 has exposed the fragility of life, and preparing for the worst is a byproduct of the virus. Some people think that they have to have a substantial amount of assets to have an estate plan, but actually, it’s for everyone, from the multi-millionaires to those with modest income. Everyone should have a power of attorney, a healthcare proxy, legal will and a wisdom will. 

A Legal Will

Do you want your final wishes carried out by default or design? A will allows you to spell out what you want done with your property. If you don’t leave a will, New York State will be appointed to settle your estate. (1) What if you don’t have a substantial property to bequeath? Every person has sentimental things that they wish to carry on after they are gone. Whether it is a piece of jewelry or a notebook full of poems that mean so much to you, documenting it in a will gives your family comfort that you are still thinking of them even when you are gone. 

You can, of course, use the online templates to create a will, but it’s important to have a lawyer involved in drawing up or reviewing your will. Things will get complicated for any asset other than types of accounts that require beneficiary designations such as IRAs. And even then, the laws regarding inherited IRAs are tricky and confusing.  

A Wisdom Will

While your legal will serves an important purpose, it is limited to mechanically distributing your assets in an efficient manner. Your Wisdom Will, on the other hand, shares your wisdom in a meaningful way

All too often people’s wisdom dies with them…leaving loved one’s yearning for answers. Don’t leave your loved ones the burden of unanswered questions. Complete a “Wisdom Will,” a unique document that provides loved ones with invaluable information about practical, legal, financial and personal matters. It’s the perfect complement to your legal will or trust. Be sure to ask us more about this exclusive service or visit www.mywisdomwill.com

Power of Attorney

A power of attorney should be next on your list. A POA gives a person or persons (agent or agents) the ability to act on your behalf in financial matters should you become incapacitated. (2) Rules for POAs are different from state to state and can be invalid for reasons you may not notice. (For example, in New York State, POAs need to be in 12-point font.) Again, if there is no POA, the court will appoint an agent or agents who will act for you. If you have complicated family dynamics, you will want to ward off any potential conflict.

Healthcare Directives

Advanced healthcare directives should also be put in place. There are three types of legal documents in New York State that you can use: healthcare proxy, living will, or a DNR (do not resuscitate). (3) In a healthcare proxy, you appoint an agent to make healthcare decisions for you. Proxies only go into effect if two doctors agree that you cannot make your own decisions. A living will lays out your end-of-life wishes, and a DNR is a medical document written by your doctor and is put into place before an emergency occurs.

You can go it alone and use online templates, but buyer beware. The do-it-yourself (DIY) templates can leave a lot of holes in your estate plan. The American Bar Association created a task force to investigate the inadequacies of DIY planning and providers have been sued by states for unlawful practice of law, including Connecticut. (4)

A few other estate planning items on your checklist should be to ensure your beneficiary designations on IRA accounts and life insurance policies are up to date. And you may want to consider creating a trust if you want to stipulate how your beneficiaries get your assets (such as over a period of time). Most of these documents will require notarization, but luckily NY State allows forms to be notarized online. 

We’re Here to Help

An estate plan is essential—and not just for the rich and famous. Everyone should have the right to direct and control the disposition of their property. But we at Montage Wealth Management know this can sometimes be overwhelming. If this is too much for you to think about, let us help you. We can work with your attorney to draw up the necessary documents, and we can also help you think through probate and estate taxes. Take the first step and contact us here; we want to help!

Montage Wealth Management does not provide legal or tax advice. Legacy planning services offered by My Wisdom Will and/or Montage Wealth Management are separate and unrelated to Commonwealth.

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(1) https://www.americanbar.org/groups/real_property_trust_estate/resources/estate_planning/an_introduction_to_wills/

(2) https://www.americanbar.org/groups/real_property_trust_estate/resources/estate_planning/power_of_attorney/

(3) https://ag.ny.gov/sites/default/files/advancedirectives.pdf

(4) https://www.americanbar.org/groups/real_property_trust_estate/resources/estate_planning/diy_estate_planning/

MARK COLGAN

Mark Colgan is a Founding Partner and Private Wealth Advisor at Montage Wealth Management with over 27 years of experience. Mark is passionate about providing proactive, comprehensive financial services to corporate executives and busy retirees so they can do more of what they love.

Through his proprietary Ahead of the Curve℠ planning process, Mark helps his clients prepare for change, both expected and unexpected, wanted and unwanted, so they can take advantage of the opportunities change brings and secure their future. Mark also specializes in helping people handle the logistics of a loved one’s death and is the author of Details After Death.

When he’s not working, you can often find Mark mountain climbing and working towards his goal of climbing all 46 of the high peaks in the Adirondacks. Mark lives in Honeoye Falls, NY, with his wife, Kathy, and their beautiful children, Christopher and Emily. To learn more about Mark, connect with him on LinkedIn.