April is Financial Literacy Month. Estate planning is a vital part of financial planning. It is exciting for me to see the many lessons and resources available about how to budget, invest, protect and financially grow more sophisticated. I am equally in awe of the many apps, technology and websites that help the do-it-yourselfers.
I want to take the time to share a Proverb: “Where no counsel is, the people fall: But in the multitude of counselors there is safety.” (Proverbs 11:14). Haven’t you heard the cliché, “I know just enough to be dangerous”? Unfortunately, I, along with many colleagues can share nightmares of the DIY impact that initially was embarked to save money but turned out to cost not only money but emotional distress and potential family classes.
In many cases, people are what we used to call “penny-wise and pound foolish.” People are often not willing to pay for the advice and guidance, but the risk they’re taking is pretty impactful. We often confuse cost with value. As an estate planning attorney, some of the most common mistakes I have seen include downloading powers of attorney and wills that do not have all of the safeguards and protections that the jurisdiction can allow or require. While there was little or no cost, the value of instead having properly executed documents is significant. I often proclaim that attorneys are professional pessimists. We have the experience of seeing what can go wrong in other circumstances and guarding against it. In estate planning, we need to guard against both greed and grief. Those two strong emotions can create action and inaction that can devastate loved ones.
I have been the person to give the bad news when a family has come to me to probate the estate of a loved one who has passed away. The pennies that were saved when a person downloaded a document were realized during the lifetime, but the conversations about the errors and omissions that were required increased the legal costs and the time required to navigate the court proceedings that have become necessary after he or she passed away. The legal navigations are frustrating and devastating when coupled with grief. Professional advisers can guide you on how to best make financial decisions that not only save money today but also grow your wealth in your lifetime as well as your descendants. Consulting with professionals helps you to identify appropriate people who can act on your behalf if you are sick or when you pass away.
When you download from a website, you don’t have the opportunity to present your desired outcomes. We each need a cadre of professionals, multitude of counsel, to provide guidance on how to not only grow wealth, with financial advisers, preserve wealth, through accountants and tax advisers, as well as pass to the next generation.
As I often say we are better together! Be thoughtful about how to invest in yourself and your family. You may save a few dollars by doing it yourself. Unfortunately, the true loss is not measured until after it is too late. Remember to balance the value as you weigh the cost.