Happy Holidays 2023, Now Is The Time, Wade's Words

Estate planning is a process that takes place while one is alive and able. It addresses the issues of protecting a person’s quality of life and assets during times of disability. It includes a plan for the transfer of assets at death that carries out a person’s intent regarding who gets what, when, and how. For a married couple, having an estate plan in place often determines the quality of life of the surviving spouse.

There are husbands out there who are reluctant to engage in estate planning. I am not sure what the real reason is. Maybe it’s too uncomfortable a topic to address. Maybe they think it is unnecessary because, “my wife will get everything anyway – right” and as a husband, “I have legal authority to make financial and healthcare decisions for her if she is unable to – right”? Whatever the real reason is, this group uses the cost of the planning as an excuse not to go forward.

The truth is that the status of “spouse” does not give a person legal authority to make financial and healthcare decisions for your wife or husband. Such authority is provided by having in place an estate plan. If there is no Power of Attorney or Advanced Healthcare Directive providing financial and health decision authority, then the healthy spouse will have to go through the guardianship process in court. The average cost is $10,000 in fees and costs.

The truth is that when a person dies without an estate plan in place, the Delaware intestate statute (died without a will) determines who gets what and when. A surviving spouse does not inherit 100% of assets that were solely owned by the deceased spouse. Take the family home for instance. If it was solely owned by the deceased spouse, then the surviving spouse receives only a life estate. The remainder interest goes to the children. The surviving spouse cannot sell the house without the permission of the children.

The lesson here is that not having an estate plan in place can be costly on many levels for the caring giving spouse in the event their loved one loses their independence with activities of daily living. It can also contribute to a surviving spouse’s financial impoverishment. Delaying completing the estate plan is “penny-wise and pound-foolish.”