Where there's a will

Black Enterprise, Oct, 1998 by Donald Jay Korn

Having a comprehensive estate plan is not just for the rich. Plan now to make your loved ones' lives easier after you're gone.

FOR CICILY O'BRYANT, IT WAS THE DEATH OF her husband. For Eugene Parker, it was having to handle the burials of his mother and his grandmother. For Kevin Smith, it was a fatal accident that struck down a young colleague that reinforced the importance of planning. In each case, a firsthand look at how cruel fate can be to the unprepared convinced each to make things easier for his or her own loved ones by developing a comprehensive estate plan.

"It's a touchy subject," says Parker, 42, a Fort Wayne, Indiana, attorney who devotes most of his professional efforts to handling the business affairs of athletes such as Deion Sanders and Emmitt Smith. "A lot of people don't prepare their affairs as well as they should. They're thinking in terms of their own death, but the real question is what their family will do. The more you do now, the less stress your survivors will have to face."

Indeed, nobody lives forever. And no matter how much we want to deny it, we'll all put in a final appearance one day. At that point, your survivors--the people who loved you--will have to make some critical decisions. Should you be buried or cremated? Should your vital organs be left to science? Should you have a quiet family memorial service or a funeral ceremony open to the community? In each case, tough decisions have to be made quickly, and in a way that won't cause hard feelings among the living.

Financial matters must be addressed as well. All the assets you have at your death, from your bank balance to your antique quilts, have to be parceled out to friends and family--hopefully according to your wishes. Titles to your stocks, real estate and cars have to be passed on. And, as you no doubt can imagine, the process can be incredibly unsettling to those you leave behind and unfair to those least able to fend for themselves, so it's best to do the groundwork while you're still breathing.

In other words, you should put together a complete estate plan to reduce the tensions that inevitably will appear after your death. Put your plan in writing and name a trusted friend or relative to carry it out.

What should go into your estate plan? Here's a checklist:

[check] A WILL. If you don't draw up a will, you run the risk that the government will decide just how your worldly assets are distributed--in other words, who gets what. "When you draw UP a will, you're in control," says Parker.

Having the government decide is not always bad. In some states, half of all your assets go to your children if you die without a will. But minors may become wards of the state, and your surviving spouse may have to account to a court for every penny spent on the children's behalf.

"I kept putting off making a will because I found it very difficult to face reality," says Kevin Smith, M.D., 38, a surgeon in Houston who's married and has two young daughters. Smith did, finally, draw up a will with the help of certified financial planner and attorney Cheryl Creuzot. Creuzot runs her own firm, Financial Strategies Group, based in Houston, a marketing affiliate of the larger AFP (Associates in Financial Planning) Group. "A lot of people think you need to be wealthy to have a will, but that's not true," she says. "Anyone who has assets and concerns about the disposition of those assets should have a will." What's more, Creuzot advises, it's best to have your will prepared by an attorney who specializes in estate planning. Do-it-yourself enthusiasts, unfortunately, aren't around to see their relatives beset by problems or haggling over the details.

[check] AN EXECUTOR. In your will you'll name an executor (sometimes known as an administrator or personal representative). After your death, prior to distributing your assets, he or she will have to take inventory of your assets, protect them against loss, pursue outstanding claims, pay bills, file tax returns and pay taxes.

An executor's job is not to be taken lightly, nor is your task of choosing one. For one, your executor will be responsible for protecting your heirs and making sure they receive their due. In addition, he or she can be liable to the IRS and/or beneficiaries if the administration isn't handled properly.

While naming your spouse to serve as executor may be your first instinct, Orlando J. Antonini, a financial planner with the San Francisco CPA firm of John R. Antonini, recommends that you fight the urge. After your death, he says, "He or she probably will be too distraught to act effectively." Antonini also recommends that you skip having a corporate entity, such as a bank trust department, take on the role. "There's no guarantee you'll have the same people working for you over time," he points out, "and, besides, the people there keep banker's hours."

Your best bet? Try grown children. If that's not practical, you can name a professional advisor, such as an accountant or an attorney, to serve. And remember, fees for professional services come directly out of your estate, so it's probably best to set up a fee schedule in advance.