Written by: Derek Majkowski. Any opinions are those of Derek Majkowski and not necessarily those of RJFS or Raymond James.
So there’s a pretty good chance we’re all going to die. I know, I know, this is such a surprising and extremely enlightening (and rather morbid) observation. Despite a feeling of invincibility and my own inability to accept such a possibility, thus far the odds are in death’s favor. To my chagrin.
So let’s assume we know, or feel pretty certain of that reality – Death will happen.
What we don’t know however, is when it is going to happen, or how it is going to happen. We also don’t know if something else may happen to us that has us physically here, but mentally somewhere else.
It is because of this lack of knowing when, how, or the state of our mental capacity from now until death, that we need to plan for both the Inevitable and the Unknown.
The “Inevitable” (Death) is an easy topic for most to usually grasp and then subsequently prepare for with planning. The reason is because death is definitive and permanent. We all understand the finality associated with it, and the planning feels more natural when discussing what happens after we are gone.
The very basic planning for death, when drafting and executing legal docs, is typically addressed through a Will and Testament. This is a document, simply put, that outlines what will happen with one’s money and personal effects when one is no longer alive.
There are also other more sophisticated tools and strategies when planning for the distribution of someone’s assets when planning for death. Often this involves drafting trusts, and addressing very specific strategies (a topic for a different blog). For purposes of providing written instructions at death however, the Last Will and Testament is the document we mostly recognize and use.
The “Unknown” (When, How, Mental State-of-Mind) however, is typically not a topic as easily grasped by most people, and in-turn is often more neglected or ignored from a planning and personal organization standpoint than planning for the inevitable. The rationale, I suspect, with not addressing these potential issues is because most either don’t know what to address, are unaware of what documents to draft in order to address, or do not want to address for other emotional or personal reasons.
Let’s try to provide some assistance and context around each:
Don’t Know What to Address. Here are some potential scenarios to consider:
- Premature death of both spouses with young children or dependents
- Incapacitation (physical or mental impairment) – this can occur without warning, or gradually over a longer period of time
- Terminal illness, coma, life support
Don’t Know What Documents to Draft. Have the following legal documents drafted:
- Guardianship (where relevant)
- Durable Power of Attorney for Health Care (always relevant)
- Durable Power of Attorney for Finances (always relevant)
- Living Will or Advanced Medical Directive (always relevant)
The Guardianship provides instructions and protections for surviving children or dependents, and is an executed document that allows the parents or guardians to direct who is best equipped to care for their surviving children.
The Power of Attorney for Health Care and Financial decisions allows someone that is incapacitated to select a trustworthy person (or entity) to direct their affairs and make financial and health care related decisions on behalf of the incapacitated individual.
The Living Will provides guidance to doctors with one’s medical preferences when that person is no longer in a position to do so on their own.
Don’t Want to Address - yet.
Many people know that at some point they need to tackle these potential, and most likely eventual, threats to one’s own life, because we don’t live in bubbles. Just about everyone has had some direct or indirect experience with someone who has dealt with premature death, impairment, deteriorating faculties, or were in an unfortunate terminal situation.
The excuse for not acting when it comes to addressing planning for these known “Unknowns”, is often based on fear, ego, procrastination, or some combination of all three.
Fear because no one wants to plan for leaving the planet too soon, or having something occur personally that removes their ability to control their own life.
Ego because nothing is going to happen to them anytime soon, or if it does, not their problem.
Procrastination, well because it’s easy to prioritize pretty much anything before hunkering down and planning for the possibility of being unable to handle one’s own affairs and / or premature death.
In any case – fear, arrogance, or procrastination – the decision to not address the planning around both the “Inevitable” and “Unknown” could be viewed by some as selfish and irresponsible. This is something that we (as advisors) are usually comfortable in pointing out to those reluctant to plan for these possible outcomes.
The impact in failing to address these areas of planning is not only detrimental to the individual’s own quality of life, but also with the aftershock to those that are left behind picking up the pieces. That responsibility and stress will often fall on family and loved ones to navigate without clear instructions.
Or worse, failing to have the proper legal documents to handle these potentially difficult and unpredictable events will place the decision making powers in the hands of the courts and legal system. This means that they determine who best will direct one’s affairs, and who wants that?
While we have identified that most people recognize the need to draft a Will to address how to instruct things at death, many fail to tackle the other necessary estate and life planning docs. If you have not done the planning for either, or only addressed the Inevitable and not the Unknown, please take the time to craft a plan for both, and then have the documents drafted. It really is very important.
As for those that have prepared these very important documents, two quick thoughts:
- Make sure your documents are relatively current and still relevant to your present day life. Often people named as Guardians, or Power of Attorneys / decision makers and stewards are selected, but may no longer be involved in your life, or even around. Just having the documents is half the battle, the other half is making sure you are comfortable with the people, or entities that hold the responsibility.
- Congrats! You can now spend your time living your life to the fullest knowing that someday the inevitable will happen, and if there is an unknown event that creeps into your life and disrupts your expectations along the way, you’ve handed the keys to someone you trust to act on your best behalf.
It doesn’t happen without the planning.
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Neither Raymond James Financial Services nor any Raymond James Financial Advisor renders advice on legal issues, these matters should be discussed with a legal professional.