This column first appeared in the San Antonio Express News and other Hearst Newspapers on January 28, 2019.
Dear Mr. Premack: My husband and I are in our 60's. We have been married for a few years, but it is not our first marriage. We are a blended family. I think we need to do our estate planning. My husband does not want to think about doing the estate planning. He did it with his first wife and doesn't think we need to do it now. Maybe he thinks it is bad luck, or was a waste of money since it was all revoked when they divorced? I don't know. We own some property together and some property is separate property. We each have our own businesses. We have rental property. What can I say to him to help him understand why this is important?
Superstition about making a Will being bad luck is groundless, as is the thought that estate planning is a waste of time or of money. Ask your husband if he thinks that homeowner insurance is a waste of money? You probably have fire insurance, auto insurance, health insurance, and may even have life insurance. If you have a car loan, you may pay for insurance on it so the loan will be retired if one of you dies. Paying for insurance is not bad luck, even if you never need to bring a claim.
Was your house destroyed by fire? No, but someone else’s was. Have you been in a serious care wreck? No, but many others have. Did you need expensive surgery last year? No, but the hospitals are full of patients. Did you die last year? No, but we will all meet that fate. The point is that no one can ever know when a serious issue will happen. What we do know is that if you have not planned for the worst, then when it eventually hits you the consequences can be deeper, harsher, and more costly than it is for those who have prepared. Insurance covers certain type of risks, and legal estate planning covers other risks you face.
You describe that yours is a second marriage. You own real estate together, and each have some as separate property. You each have a business. In your 60’s you won’t have minor children, but certainly have concerns about how to balance the love you have for your spouse against the love each of you feels for your respective adult children.
Since you are both in business, and have both been divorced, you know the harsh legal reality of the end of marriage. Divorce is difficult on both ex-spouses financially and emotionally. It is hard on the children as well, no matter their ages. You know, but probably suppress, awareness that a spousal death is another end to your family. Disability of a spouse can be just as traumatic. Pre-planning is essential to making these painful situations more endurable.
The two of you have a complex family and a complex legal structure. Organization into the correct legal framework will make a life-changing situation more tolerable and less complex. Even if you divorce, estate planning can help eliminate many potentially ugly conflicts. The two of you should have a marital property agreement to make it clear what each of you owns, how it would be split if you divorce, and what rights you have if one of you dies. You should consider establishing one or more LLCs to own your rental properties, to insulate your other assets from the likelihood of being sued by an injured tenant.
You should have Wills, and in them make decisions about how to allocate assets between your surviving spouse and each side of your blended family. Wills can contain special trust provisions so that you can take care of everyone, keeping the emotional bonds intact instead of fueling an expensive court battle over inheritances. You should have Durable Powers of Attorney and have Advance Medical Directives.
Perhaps if your husband gathers more information, he’ll be ready to move forward. He could read my book “Thinking Beyond Tomorrow” (Amazon) or read many of my past columns to see the type of problems and solutions that legal pre-planning can offer. Support him past his fear, and you can move forward together.
Paul Premack is a Certified Elder Law Attorney with offices in San Antonio and Seattle, handling Wills and Trusts, Probate, and Business Entity issues.
Comments