In my line of work I’m continually reminded of the importance of estate planning (…especially for parents of minor or special needs children!), and this week is no exception.
Last Tuesday, one of my staff members lost a close family friend in a car accident. She left behind 4 children; one who is 19 with autism and a host of other developmental delays. I’ll call him “Mike.”
Ironically, Mike’s father had died in a car accident 15 years earlier. Mike’s mom had recently remarried only 6 months ago and the new step-dad is just not in a position to care for Mike on his own. Worse, when Mike turned 18 last year, mom petitioned to have her and her other 23-year-old son, Zack, to be the legal guardians of Mike. Mom assumed that when she was older and passed away, Zack would then be prepared to care for him full-time. But now that mom is suddenly gone, Zack is having a hard time doing everything required to care for his brother. He is in school full-time and now has the burden of going to regular therapy appointments, occupational therapy, speech therapy, neurologist appointments, managing medication, and helping his brother with the basic tasks of daily living. He is thinking of dropping out of school, which is the last thing his mother would have wanted.
Mom had no will or trust, and named her two older boys as beneficiaries of her life insurance. She didn’t want to leave anything to Mike of course out of fear it will jeopardize his ability to receive Medicaid and other government benefits. But now, the middle son is being wasteful and stingy with the money. Will he set aside a portion for Mike’s care… or will he spend it on fast cars, trips and parties? Family members fear the latter.
A special needs trust, and a revocable trust for the other kids, would have made this a non-issue!
Oh, and the new husband? Although he was the love of her life, mom never got around to updating her beneficiary designations to include new hubby on her life insurance policy and retirement accounts should something happen to her. Because she made more money than him, he is now unable to pay for their condo and car payments on his own. He’s basically out of luck…disinherited because of a blended family situation.
Here’s the lesson to be learned: just because you talk about your wishes with loved ones, doesn’t mean they will honor them when you are gone. When you leave behind assets, minor children, or you’re in a blended family, you MUST have a will or trust to ensure that your family is cared for exactly as you want if the unthinkable happens. When grief, emotions and money are involved, the honor system just doesn’t work!
