Estate planning isn’t about how much you have. It’s about protecting the people and life you’ve built.
There is a phrase I hear all the time: “I don’t really have an estate.”
Yes, you do.
You may not have a mansion, a yacht or a mysterious Swiss bank account. But you probably have people you love. A home or apartment full of things that mean something to you. Bank accounts. Retirement benefits. A car. A pet. Digital accounts. Maybe children. Maybe a partner. Maybe a group of friends who are more family to you than some of the people you share DNA with.
And you have something else that matters enormously: your wishes.
That is what estate planning is really about.
It is deciding who you trust, who you love, who should be protected and who should be allowed to speak for you when you cannot speak for yourself.
LGBTQ+ people in particular have learned an important lesson over the years: Never assume the law, an institution or even your biological family will automatically understand the family you have created.
Put it in writing.
If you don’t make the decisions, someone else will.
At Burch Law, our tagline is: If you don’t have a will, the state of Texas has one for you. And Texas did not sit down with you first.
It doesn’t know that your best friend has been at your side for 25 years. It doesn’t know which sibling you trust and which one you absolutely do not trust. It doesn’t know that your partner should be the person standing beside your hospital bed, that your niece should get your grandmother’s jewelry or that there is only one person on Earth you want caring for your dog.
That is why a complete estate plan is about far more than a will.
Depending upon your circumstances, planning can include a will or trust, financial and medical powers of attorney, HIPAA authorization, a directive regarding medical treatment, guardianship documents and instructions about funeral and burial decisions. LGBTQ+ families may also need to consider issues involving chosen family, unmarried partners, property agreements, parentage and protecting important relationships that aren’t necessarily reflected on a traditional family tree.
Marriage equality was a monumental step forward, but marriage itself does not eliminate the need for planning. A thoughtful estate plan allows you to actually name the people you want making decisions and receiving what you leave behind, rather than relying on assumptions or default rules.
Your estate plan and your financial plan should actually talk to each other.
Here is another mistake I see frequently: Someone gets their legal planning done in one place and their financial planning done somewhere else — and nobody makes sure the two plans work together.
They should.
Your will might say one thing, while the beneficiary designation on a retirement account says another. And guess which one generally controls that retirement account? The beneficiary designation.
Life insurance, retirement accounts and other assets that pass by beneficiary designation can be an enormous part of what you ultimately leave behind. That means estate planning cannot simply be about signing documents and placing them on a shelf. You need to know what you own, how it is titled, who the beneficiaries are, where the money goes and whether all of those pieces accomplish the same goal.
Good financial planning asks questions such as: Are you saving enough? Are your investments appropriate for your goals? What happens financially if you become disabled?
Do you have enough insurance? Are your beneficiary designations current?
Good estate planning asks: Who receives those assets? When? Under what circumstances? Who manages things if you cannot? And what happens when life doesn’t go according to plan?
They are two halves of the same conversation.
And this isn’t just about death. Frankly, some of the most important estate planning documents have nothing to do with dying.
What happens if you’re alive but temporarily unable to make decisions? Who can access your medical information? Who can talk to your doctors? Who can handle your finances?
Who can pay the mortgage, deal with your insurance company or keep your business operating?
These aren’t questions reserved for retirees.
We regularly tell parents that one of the most important estate planning milestones happens when their child turns 18. Suddenly, that child is legally an adult — and Mom and Dad don’t automatically have the same authority they had the day before.
Estate planning is life planning.
Your legacy is bigger than your money. For years, the estate planning world has used the word “legacy” as though it means wealth. I don’t believe that. Your legacy is your story.
It’s the people you loved. The family you created. The traditions you started. The causes you cared about. The ridiculous family stories everyone tells at Thanksgiving. The advice you gave. The mistakes you made. The things you learned.
Money is part of the picture. It isn’t the whole picture. That is especially meaningful in the LGBTQ+ community, where so many of us have had to define family for ourselves.
Your documents should protect your assets. But your planning should protect your people and your story.
The hardest part is usually just starting. People put this off because it feels overwhelming, expensive or depressing. So they wait.
And wait.
And tell themselves they’ll deal with it when they’re older, wealthier, married, retired, finished having children or finally have their finances perfectly organized.
You do not need to have everything figured out before you begin. You just need to make the next right decision.
Financial planner Bonnie Chadwick of Paratus Financial and I will be talking about these issues at the Financial & Estate Planning for Everyone program at Northaven United Methodist Church from 12:30-3 p.m. on Sunday, Oct. 25. We’ll discuss practical steps for preparing financially, protecting the people you love and making sure your legal and financial plans actually work together.
Because being ready isn’t a feeling. It’s a decision. And the best time to make that decision is while it is still yours to make.