Six Myths about Estate Planning

Myth #1: It’s just stuff.

It’s just stuff right up to the moment that either Person A gets some stuff that Person B wanted and/or Person A gets some stuff that Person B believes to have more value than the stuff that Person B got. At that point, it’s no longer “just” stuff. Now it’s “essential” stuff, or “crucial” stuff, or stuff “worth sacrificing everything else for.”

Myth #2: Value is an objective measure.

When you go to the store and buy a box, yes, there’s an objective measure of its value: whatever you paid for the box, that’s what it’s worth (or, perhaps more accurately, whatever the store was willing to accept for the box is what it’s worth). But once you’ve owned that box for a few years the objective measure of its value disappears. It’s now “the box Dad used to store the pictures of the grandkids,” or it’s “Mom’s favorite tool box,” or it’s “the box that Aunt Mabel added the false bottom to and hid all her diamonds in.”  You can take the box to the Antiques Roadshow, or put it out for bid on eBay, but no matter what you do there will be a dispute to its value.

Myth #3: It’s the big stuff that matters.

                                                   

Who gets the house? Who gets the car? Who gets the money left in the retirement accounts? Important questions, for sure, but not the only important question. Who gets Dad’s cheap-ass Timex? Who gets Mom’s “favorite” worn out purse? Those questions can cause everything to seize up just as easily as “why did Cousin Fred get the Lamborghini?”

Myth #4: Your beneficiaries will understand your decisions.

No. They won’t. We all have our own sense of justice, we all have our own sense of who the involved individuals are, and we all have our own sense of the “value” of things. Those are the filters all the decisions will be run through, and since the filters are different the understanding will be different.

Myth #5: There’s a distribution that will satisfy everyone.

No. There isn’t.

Myth #6: It’ll work itself out.

Less a myth, I suppose, than a question of definition. An estate works itself out the way Superbowl XLIX worked itself out. This is to say: some percentage of the people will walk away ecstatic, others will walk away upset, and some won’t care in the least; some will argue that the outcome was the result of talent, skill, planning and intent, while others will argue that it was all just dumb luck; some will find the outcome just, others will wonder how the universe can be so unfair; some will say the decisions were the dumbest ever made, and others will find them extraordinarily well-considered; and eventually it will all just recede into the background and folks will accept the outcome -- they don’t really have much choice -- until something happens or someone says something or just because, and it all comes boiling to the surface again.