As your parents get older, your family must begin to think about what happens after they pass away. While this is a topic that no one wants to think about, it is necessary if you want to avoid misunderstandings and unnecessary conflict. Estate planning and inheritance may be difficult subjects to bring up to your mom and dad, but the more you all understand, the better.
Confusion about estate plans can result in probate disputes and irreparable rifts among families. Here are some of the most vital things you should know about your parents' estate plans.
What plans do they have in place?
It is helpful to be aware of the documents your parents have so far. For example, do they have any of the following?
- A will
- A trust
- Beneficiary designations
- Joint bank accounts with rights of survivorship
When you have an idea of what constitutes the estate plan, you will have a better understanding of what to expect when they pass.
Where are the documents?
An estate plan is no good if no one can find it. Make sure someone knows where the documents are. Even if it is not you, it is important for the executor and attorney to have access to them. They should be in a secure location, such as a safe deposit box, desk drawer or high bookshelf.
Who is the executor and power of attorney?
Your parents designate individuals to handle estate matters. The executor manages the estate once they pass away, while a power of attorney makes financial and/or health decisions in the event of mental incapacitation. Surprises about who these individuals are can lead to confusion, anger and resentment. There can also create misconceptions of favoritism or undue influence about these choices.
Remember, your parents may not be as forthcoming as you want them to be about these topics. If you frame questions around the importance of family unity and financial stability, you may be able to get some answers.