“It was a dark and stormy night when suddenly I realized I had not executed any estate documents.”
It may not be the most gripping line you have ever read, but it very well could be the beginning of a horror story. You may have heard the phrase, “There is nothing certain in life except death and taxes.” Yet, despite the certainty of our mortality, many individuals tend to avoid planning for not only the distribution of assets after death but also decisions that may need to be made if you become incompetent before your death. Unfortunately, avoiding these decisions does not alleviate the pain associated with premature death or disability; rather, it creates “unfinished business” – the building block of ghost stories that can take a variety of shapes.
The Ghost of Intestacy
Steig Larsson is most famous for writing “The Girl with the Dragon Tattoo.” He had planned to write seven books for the series but died of a heart attack after completing the third book. Unfortunately, he also died without a Will. As a result of dying intestate, his partner of more than 32 years, Eva Gabrielsson, was not entitled to any of his assets. Per Swedish law, his father and brother inherited the estate, including the rights to the novels. The author of suspense had unintentionally created his own legal drama.
You may be surprised to learn that Alabama law shares similarities with Swedish law. In Alabama, a surviving spouse is entitled to the total estate only if there are no surviving parents or children of the deceased.1 Otherwise, the surviving spouse receives a portion but not the full amount. Like Gabrielsson, it’s horrifying to imagine the additional stress and burden that could accompany a family due to a failure to clearly communicate your wishes in a properly executed Will.
The Ghost of Inaccuracy
Heath Ledger was on his way to winning an Oscar for his performance as the Joker in The Dark Knight when his life was tragically cut short in January of 2008. Unlike Steig Larsson, Ledger had executed a Will in 2003 specifying that his estate be split between his sisters and parents. However, his daughter, Matilda, was born in 2005, and he never updated his document. Given his unexpected death, it was certainly an oversight that his documents had not been updated to include his daughter.
As life events occur, it is critical to make reviewing your estate plan a priority. Not only should your Will be reviewed periodically to ensure it still meets your needs, but you should also review beneficiary designations and titling of assets.
The Ghost of Inability
Casey Kasem (best known to my generation as the voice of Scooby Doo’s pal, Shaggy) was diagnosed with Lewy body dementia in 2007 at age 75. As his disease progressed, so did the fighting between his second wife and three children from his first marriage. Kasem executed a Durable Power of Attorney for Healthcare in 2007, but it appears he failed to communicate his wishes to all parties involved. In his final days, he was relocated multiple times as the family disputed his care.
In the event you are unable to make decisions for yourself, it is critical you have a Power of Attorney and Advance Healthcare Directive. Each serves a unique purpose, but both can assist your family and loved ones during a time that is already difficult. A Power of Attorney names an individual that can act and execute business on your behalf. The Advance Healthcare Directive allows you to explicitly state how you would like to receive medical care and who has the authority to make medical decisions for you.
As Kasem’s situation illustrates, it is not enough to simply execute these documents. It is critical to communicate your wishes to your family. As Bridgeworth partner Patti Black, CFP® likes to say, “Get comfortable being uncomfortable.” These discussions can be scary, but it may avoid a true nightmare down the road.
Fear can be paralyzing. Whether fear of a wrong decision or simply fear of the unknown, individuals delay estate planning for various reasons. It is important to remember, though, that “no decision is a decision.” Your “unfinished business” may leave your loved ones to be haunted by the legal court’s plan. If you need help looking forward, moving forward, reach out to a Bridgeworth advisor today.
Bridgeworth Wealth Management is a Registered Investment Adviser.
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1 Source: Alabama Code, Title 43 — WILLS AND DECEDENTS’ ESTATES, Chapter 8 — PROBATE CODE, Section 43-8-40