Finalizing Estate Plans
The
following is as summary of a presentation made at the
The Nassau
Academy of Law recently held a Dean’s Hour, hosted by the Surrogate’s Court,
Estates & Trusts Committee. The topic of the presentation was How To Get
Your Clients To Put Their Estate Plans Into Effect. The featured speakers
were R. Phillip Colon, Ph.D. and Jerry I. Kleiman,
Ph.D., of OPTIMAL RESOLUTIONS, INC., a consulting firm specializing in
family conflict management and resolution. From their experience as family
psychologists, Drs. Colon and Kleiman shed light on
why families tend to avoid or have difficulty completing the estate planning
process. Considering the large attendance as well as the questions and comments
of the audience , it was apparent that the topic reflected a problem commonly
experienced by estate and trust lawyers.
Drs. Colon and Kleiman discussed how ignorance of the tax laws or the dire
consequences of not having an estate plan does not adequately explain the
phenomena of avoidance that lawyers typically experience. When legal advisors
have the opportunity to inquire of their clients as to what is holding up the
process, they usually hear a plethora of emotional or relationship concerns
from the potential benefactors. Some of the issues usually encountered include:
I.
Long-standing marital tensions that have been
avoided often erupt as
parents discuss options
concerning their estate plan and their children.
II.
Difficulty in coming to terms with the issue of
one’s own mortality.
III.
Discussing disbursement of assets or
transferring of power in their family business can evoke a sense of
losing control.
IV.
Grappling with decisions of "fair vs.
equal" in the disbursement of assets to
offspring. The subject becomes further complicated when there are children from
former marriages.
V.
Parental concerns that tensions among siblings
may be provoked by the estate plan.
VI.
Fears that the children will be "hurt"
by inheriting large sums of money, and lose their motivation to work or
succeed.
VII.
Envy on the part of potential benefactors that
by inheriting their "hard earned" money their children "will
have it easier" than they did.
VIII.
Distrust of their childrens’
maturity and ability to handle bequeathed assets responsibly.
IX.
Family assets can be "family secrets."
While family members often know assets are there, the topic may be rarely
discussed. Spouses themselves can be kept in the dark about details of family
holdings.
Some legal
counselors expect clients who harbor such fears and concerns to simply put them
aside in the name of expediency. By not acknowledging these issues and by not
dealing with them, the entire estate planning process can be derailed.
Drs. Colon
& Kleiman cautioned against using estate planning
tools, such as incentives and disincentives, to resolve emotional or
relationship problems in the client's family. While such strategies are often
helpful, they can also foment resentment and discord between generations,
between parents or among siblings.
While lawyers
are not family psychologists, the presentation acted as a reminder that they
would do well to identify the emotional concerns of their clients. To the
degree that they are competent to do so, those in the audience were encouraged
to take a proactive approach and address their clients emotional concerns. The
direct approach appears to be the best approach. Taking the time during the
initial consultation to identify problem areas can save time later on.
Surprisingly few in the audience indicated using written questionnaires for
their clients to complete on their own time.
If these
suggestions sound too time consuming or beyond the scope of one’s expertise,
the estate planner can use other resources to assist in the process. Complex
families and/or estate plans at times require a coordinated interdisciplinary
team approach.
Drs. Colon and Kleiman view the process of estate planning as another
opportunity for family members to address unresolved problems and relationship
issues. They suggested that, when possible, offspring be included in the estate
planning process. Some parents find that as a consequence of dealing directly
with their children, a number of their concerns may be unsubstantiated, outdated,
or due to unrealistic expectations on their part. By first identifying their
"family value orientation", and by developing a family mission
statement, the presenters feel that families can build a common platform from
which their differences can often be resolved.
[1] Drs. Kleiman and