Periodically, we receive calls from children after their parents have passed away inquiring about their inheritance. If these are children from a parent’s first marriage, most often they are dismayed and surprised that the father (99% of the time it’s the father) did not leave anything to these children in his will. After all, the child says to me, “I spent so much time by his hospital bed, took care of him in his final stage of his life, I am sure he took care of me in his estate plan as well.”
Unfortunately, and understandably so, when people are at the last stage of their life, they no longer want to focus on their estate planning. They either want to focus on fighting with their sickness and health care is the priority at this stage, not their financial affairs.
For most children, inheritance is a very difficult question to bring up as parents and even children associate estate planning with death, and nobody wants to broach this difficult topic. However, when parents do not address the issue and do not plan their estate, it puts the children in financial turmoil as they are faced having to deal with their parents’ estate after the parents are gone. This is a difficult result and something that both parents and children would not want to happen. Both parents and children recognize that the headache of dealing with the financial affairs of a parent after their death along with additional layers of obstacles that are added when the court system is involved take away from what should be a time of grieving and being with family and friends. So how to start this difficult conversation?
Some children approach it from the perspective of Medicaid planning; after all this conversation is about taking care of parents during their lives, and that conversation is easy to have on both sides. But what if Medicaid is not in the parents’ cards due to their excessive financial resources? It does not always have to be a discussion about inheritance, passing of the parents or even Medicaid planning. It can also be a conversation about asset protection: protecting assets from potential creditors such as doctors or hospitals. Or it can just be planning to ensure that all proxies (health or financials) are in order for the children to be able to take care of the parents in case of their incapacity. This conversation must happen while parents have the capacity to make the decision and choice of appointment. During that conversation it always surprises children how easy it is for parents to discuss their children’s inheritance and deal with the planning which would allow kids to receive it with ease and without the troubles that would be involved without planning. After all, parents took care of their children all their life so it follows that they would always want to take care of them after they are gone.
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