Nov 28, 2022
The estate planning cliché
People who know me well understand that I love a good cliché. In fact, I often rely on them to the point that I can feel my wife’s eyes roll when I’ve used a phrase one too many times.
And so, I’m evolving. I realize that while clichés are an easy way to explain an idea, they might actually distract the listener.
The world of estate planning is rife with opportunity for my cliché-ridden brain to run amuck. An estate plan is vital to your overall personal financial plan. It’s an ideal setting to lay out your wishes, should something happen to you.
Many people are hesitant to establish or even work on their estate plans. It’s for good reason—human beings are not wired to ponder their mortality in the context of how some governing body might interpret it. I think it’s safe to say that some of us don’t even care about what the U.S. government or their state government has to do with our final wishes.
In the spirit of exorcising three common clichés about estate plans and why everyone should have one, I promise not to use these (much) in the future:
1. If you don’t have a plan for your estate, your state does
Each state has different rules about how your estate will be handled and what happens to your property (i.e., all the assets that you own) after you pass away. The lack of even a simple estate plan means the state you lived in at the time of your death will determine what should happen to your estate. It’s quite possible that the state’s decisions regarding your property won’t align fully (or at all) with your wishes, and that would be a shame for your beneficiaries and your legacy.
For those of us living in states with well-run finances and a governing body above reproach, you can ignore the rest of this. However, for the rest of us, read on.
2. Even a mediocre plan well executed today beats the perfect plan made tomorrow
I’m paraphrasing General George Patton with this line. And what does a World War II general know about estate planning? Probably very little.
General Patton realized that when something is important to you, it’s better to have a rough plan than no plan at all. In my quest to establish the perfect plan, I might rethink my choices over and over, to the point of paralysis, and end up with no plan at all. This does nobody any service and makes an uncertain situation even more challenging.
Estate plans are not written on granite tablets. Many documents in your estate plan are revocable and can be changed. Don’t let the idea of having the optimal plan triumph over having a plan altogether—even if it’s not what you consider the exact right plan.
3. No one can read your mind
There are several technical aspects to estate planning that aren’t necessary to master in order to have a viable estate plan. But one truth above all is that, most likely, you're the only person who truly knows how you want your affairs to be handled when you’re no longer here.
Consider, for example, the last time you ordered something to eat for delivery. Unless that restaurant is your kitchen at home, there will be something inevitably “off” with your meal. Perhaps something is a touch too salty or not hot enough, or the portion isn’t quite big enough.
The reality is that it’s nearly impossible for a restaurant to anticipate your every gastronomic desire. So how on earth can someone else guess how you’d want your estate to be handled?
Write down your estate wishes and help them out. This is your golden opportunity to ensure your estate plan is just that: YOUR estate plan. And that’s no cliché.
ABOUT THE AUTHOR
Nick Cosky, CFP
In his role as Wealth Manager, Nick is primarily responsible for introducing prospective clients to BDF. Nick has served as the head of BDF’s Financial Planning Committee and has participated on the Business Owner Team. He is passionate about the goals-based planning that BDF does for its clients and enjoys focusing on the behavioral aspects of decision making. Nick is a CFP® professional.
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