Estate Planning: Having the Conversation

When I was first practicing law in the 1980's, the term "estate planning" conjured up visions of lawyers in expensive suits and large offices sitting down with the DuPonts and the Pews and figuring out ways to keep their fortunes intact through the next ten generations. Estate planning meant avoiding taxes through intricate schemes and legal gymnastics that most of the people I knew didn't need. Today [now 2020 - ed.], the federal estate tax only applies to estates over $11.58 million per person. Only the wealthiest 2% of the population needs to be concerned with planning for federal taxes. But I have lived more life since then, I have seen loved ones become ill and pass away, and I have gone to their homes and sorted through their things, and discovered more about what estate planning really means. It is about planning, about organizing, about confronting your own mortality, and most of all about having "the Conversation".

People shy away from thinking and talking about the various events of life that can change their day to day routine so quickly: about accidents, illness and disease, aging and death. They are events that we cannot control, but they are events that we can plan for. Having the conversation starts with talking to yourself: what is your contingency plan if you are hospitalized, if you have a lingering illness, if you cannot make your wishes known to your doctors and loved ones. Who do you want to make those decisions when you can't?

The law is its infinite wisdom provides the method for all of the people who do not plan for these events. If you cannot take care of yourself, the law permits a guardian to be appointed, in a process involving lawyers, a judge, hearings, time and expense. If you have not made your wishes known through a living will, then the law provides the same process: lawyers, a judge, hearings, perhaps Congressional hearings and political battles as well, all to determine what you might have decided if you had been competent to decide the issue of your own life and death. A little thoughtful planning, a discussion with your family, a little expense, and you can provide for these situations, you can decide the issues that only you should really decide, you can document them, and then you have done all you can. You have bought a relatively inexpensive form of insurance for the situation. But most important, you have had the conversation, first with yourself, and then with your loved ones. You have made a plan.

Estate planning today means having a durable financial power of attorney that designates one or more trusted loved ones to take charge of your financial affairs when you are unable to do so. It means having a living will - also called a medical directive - that expresses what you would want done if you are in an end-stage medical condition, and selecting the person or people who you want making those decisions when you can't. It means having a will that provides for your loved ones and appoints the person you want to handle your affairs. It means considering making gifts while you can enjoy the giving; checking to make sure your insurance beneficiary designations are up to date; putting your records together in one safe place, writing notes to explain your affairs, and even attending to your genealogy, and putting the names of the people on the back of the old family pictures. It means telling your loved ones that you love them, writing them letters to be opened when you are gone, and showing them how much you love them by the thoughtful way in which you have prepared for that day.

By having the conversation, first with yourself, and then with your loved ones, and then putting an estate plan in place, you do not ward off the events of life, but you have done everything in your power to prepare for them. So start today, in the morning over coffee or tea, and have the conversation.

first published: (2-21-08)  *  last revised 5-1-2020  *  ©2008 Douglas P. Humes

Doug Humes has been a practicing attorney in Pennsylvania since 1980.  He has experience in real estate, community, corporate and small business law, and estate planning.  In 2003, he opened his private general practice at the Millridge Manor House in Bryn Mawr, Pennsylvania.  You can contact him at Tel: 610-525-7150, or via email at humeslaw@verizon.net).

On the Shoulders of Giants: Direct Debit of HOA/Condo Assessments - Can it be done; should it be done; how is it done?

[I belong to various mailing lists, where other lawyers from different specialties gather to discuss issues and how they handle them in their practices.  I have made a habit of copying the particularly useful suggestions, comments, and forms that are submitted in these lists into my personal collection of forms and commentary that constitutes my electronic law library.  Now that I have started blogging, I am going to pass along items that I believe may be helpful to clients and other practitioners in these areas.  I don't claim any originality in these postings - they are basically a compilation of the good ideas of others - using my language and editing.  I am therefore standing on the "Shoulders of Giants" when I do so.]

I have had landlords who have negotiated into their leases the concept of having direct debit from the tenant's account for monthly rent.  Creditors love this idea - the money comes on time, without float, without excuses.  Most of us are over the fear of some horrible Big Brother type assault on our finances when it is done by computer rather than by check.  We (most of us) are comfortable with online banking.  We pay some of our bills and utilities this way.  So why not extend the idea to HOA and Condominium assessments? 

Can a Board require this, to the exclusion of any other payment method?  Probably not right now.  There are people who don't have computers, don't have the software, don't bank online, or don't have the confidence in electronic payments.  They will always need to have an alternative available for them.  However, in light of the convenience and time saving of the electronic debit, could a board offer a discount to those who would agree to electronic debit payments?  Yes, I think so.  Just as sending out paper bills, with stamps, which someone must create, stuff, lick, and post, is labor intensive, so is opening the envelope, stamping the check, doing the math, putting them together with a deposit slip, and making the deposit to the bank.   With a pre-authorized monthly or quarterly debit, the transaction happens while we are going about our other business.  It saves effort, and so should result in some savings that justifies giving a discount.  Who can complain?  If you have been to a public meeting, in these situations everyone can and often does complain.  However, if they have the same right as everyone else to pay electronically, like cash or credit at the pump, then your objectors should be few, particularly if you can show actual savings to the Association. 

Must the Board undertake this change by the more laborious amendment of the bylaws, or can this be done by adoption of a rule?  Most list mates seem to think that it can be done by rule adopted by the Board.  Your mileage may vary - depending upon your state, your association's articles or bylaws.  Always check your state law, and then your governing documents, to make sure there is nothing that can trip you up.  And if you want to propose doing this, do your homework, quantify the savings, check with your bank on any other fees, so that when you present the idea, you have fully considered the pros and cons.  If you have already done the math and double checked it, it should sell itself.