Here at the Blog, we see a great number of articles week in and week out concerning estate planning. Getting our estate planning done properly is an essential component of LifePlanning, which is Rajiv’s term describing his holistic approach to retirement preparedness.

But what does “proper” estate planning look like? And why does traditional advice on estate planning so often overlook the guidance your family is most likely to need in a crisis?

Today, as Exhibit A representing the traditional approach, we’re examining this article from Kiplinger, prepared by financial writer Jacob Wolinsky and published last April. While there’s nothing fundamentally inaccurate about Wolinsky’s article, which deals with how to discuss your estate plan with your family, we find his information lacking essential components.

With that in mind, we’ll first review Wolinsky’s six-step plan for better family communication. Then we’ll ask Rajiv to show us where the Kiplinger article (like most similar articles) misses the mark.

An Estate Plan is a Necessary Tool for Your Loved Ones

“No matter where you are in life,” Wolinsky begins, “having an estate plan is both necessary and considerate. While talking to your loved ones about end-of-life decisions can be difficult, it’s necessary to clearly communicate your wishes to avoid misunderstandings later.”

Though these conversations are sensitive in nature and can bring out emotional responses from loved ones, he says, clear communication of your desires can help ensure that your future wishes are respected, and can also give you peace of mind by “bringing everything out into the open” before you pass.

He writes, “Studies show that the lack of an estate plan can lead to needless disputes among families, with 58 percent of respondents experiencing conflicts over finances and assets. Without clear end-of-life instructions, families might face lengthy court battles, which can be financially and emotionally draining.”

With that in mind, here are six things that Wolinsky encourages us to consider when putting together an estate plan and presenting it to our loved ones.

Get Your Plan Completed Before Talking to Family

Before you present any of your plans to family, Wolinsky says, it’s best to know what you want first, no matter what your financial landscape looks like. That means, get your plan in place.

“You might be wealthy enough to need an estate plan for millionaires, or you might be struggling and need guidance on how to save money on estate planning,” he writes. “In either case, it’s important to designate who will inherit your assets and manage your end-of-life health care choices (called an advance directive).”

After you know what you want out of the process, he adds, make sure you discuss your thoughts with your partner or spouse first before you bring the plan to the rest of your family.

Your Family Needs to Know the “What” and “Where” of Key Documents

The next steps are the practical ones: start with making sure that your family knows what documents you’ve already prepared and where to find them.

“In addition to your will, you should also let them know where to find your financial statements and other relevant papers,” Wolinsky writes. “Do you have a 401(k) or pension tucked away? What financial institution do you use? How much is your coin collection worth, and who gets that pristine 1955 Mercedes-Benz stored in your garage? In many cases, financial decisions might need to be made quickly after you’re gone, but your family won’t be able to act if they can’t find your paperwork.”

For similar reasons, he also advises including contact details for your estate attorney, accountant, or other relevant professionals who can help your family with the transfer of assets after you’re gone.

In Your Planning, Remember the Importance of Family Unity

Family squabbles are common, but sometimes difficult to predict. You can get ahead of the main causes for conflict—and alleviate the potential for turf wars—by making sure that you have a clear plan in place for how you would like your final wishes carried out.

Wolinsky writes, “One of the main goals of an estate plan is to promote family unity and avoid conflicts among your loved ones following your death. It isn’t just about finances and possessions; it’s also about preserving relationships and family values.”

A Complete Estate Plan Takes Family Emotions Into Account

While putting together an estate plan, it’s vital to consider the possible emotional responses from loved ones. “Many adult children are surprised about the size of their inheritance because they expected either significantly more or less than what you left behind,” Wolinsky explains. “If you put guardrails in place so your heirs don’t blow their inheritance, they might feel that you don’t trust their judgment.”

Unequal inheritance between siblings or other family members can also be a potential minefield, so your estate plan can be the perfect place to explain your reasoning. “For example,” Wolinsky writes, “if one child has special needs or has many children, you might want to provide more support to that child.”

This is an area where the right professional is an indispensable ally. Your estate lawyer can help you structure these differences in your plan in the kindest and most reasonable way.

“When dealing with the loss of a parent or other loved one, emotions are often running high, and when there are significant surprises, it adds to the confusion,” Wolinsky adds.

Choose Your Agent(s) with Particular Care

Wolinsky urges a healthy realism when setting plans. “For example,” he writes, “it might be a good idea to put more than one beneficiary in charge of your estate and the transfer of your wealth. If you only choose one person, other heirs might feel resentful that they weren’t allowed to participate in the process. On the other hand, piling all the responsibilities onto one person might make them feel overwhelmed, especially if they’re dealing with their own challenges.”

It’s also important to be realistic about large assets. For example, does your child truly want to follow in your footsteps and maintain the family business?

“It’s important to have discussions about this issue beforehand and put plans in place to liquidate the family business upon your passing if your children don’t want to be involved,” Wolinsky writes.

Make Sure to Choose the Right Moment for the Conversation

Communication is key, but time and place are crucial. End-of-life conversations can be difficult or even awkward, and choosing the right circumstances is important for you and your family to have the best possible discussion.

“Select a time and site that lead to open and honest communication,” Wolinsky advises. “Family gatherings, holidays and other celebrations when emotions are already running high might not be the best time. Instead, schedule a family meeting at a setting that works for everyone, or set aside some one-on-one time with each member of the family to discuss your estate plan privately.”

Family Conversations are Challenging, but Essential

Wolinsky concludes his article with the final note that while these conversations can be challenging, they can also be both useful and freeing. With forethought, the transfer of wealth and carrying out of your wishes can be as smooth a process as possible.

He also takes the opportunity to advise, once again, the hiring of a professional. He writes, “A wealth manager or estate planning attorney can explain all of the intricacies of your plan and help you make the best decisions based on your wishes. If something changes along the way, a professional can also make sure the revisions are properly incorporated into the documents.”

Rajiv’s Comment: This “Advice” Is Not Enough

Rajiv’s reaction to this Kiplinger article was predictable. He called it “plain vanilla” advice that “misses the mark badly” – not for what it says, but for what the author fails to say.

“I’ve read hundreds and hundreds of articles just like this one,” he says. “They all take exactly the same approach: get your documents ready, let your family know where they are, choose the right time for the talk, and so on. It’s boilerplate advice, nothing more.”

The Missing Component: Your Need for Long-Term Care

While the legal documents are important, Rajiv elaborates on what’s missing.

“Look, if you go to bed one night and don’t wake up, your family will grieve but hopefully they’ll figure things out from your legal plans,” he says. “But statistically, the odds are far, far greater that your loved ones are going to have to deal with a much different and more challenging scenario. You’ll fall victim to dementia. You’ll have a stroke. You’ll have to deal with illness or disability.”

He goes on, “What’s the common denominator in these outcomes? Long-term care. The odds are overwhelming: about two-thirds of seniors will need long-term care at some point. Your family is probably going to be responsible for helping implement your long-term care plan. But do you have one? Have you decided how and where you want to grow old? Have you made plans to pay for the care you’ll need? Is your plan in writing? Does your family know all this?”

Rajiv’s conclusion: “Until you can answer ‘yes’ to these critical questions, no matter how many legal documents you have, your plan is dangerously incomplete.”

(For more on this vital topic, check out this helpful article from our Blog.)

Rajiv Nagaich – Your Retirement Planning Coach and Guide

The long-awaited book by Rajiv Nagaich, called Your Retirement: Dream or Disaster, has been released and is now available to the public. Retirement: Dream or Disaster joins Rajiv’s ground-breaking DVD series and workbook, Master Your Future, as a powerful planning tool in your retirement toolbox. As a friend of AgingOptions, we know you’ll want to get your copy and spread the word.

You’ve heard Rajiv say it repeatedly: 70 percent of retirement plans will fail. If you know someone whose retirement turned into a nightmare when they were forced into a nursing home, went broke paying for care, or became a burden to their families – and you want to make sure it doesn’t happen to you – then this book is must-read.

Through stories, examples, and personal insights, Rajiv takes us along on his journey of expanding awareness about a problem that few are willing to talk about, yet it’s one that results in millions of Americans sleepwalking their way into their worst nightmares about aging. Rajiv lays bare the shortcomings of traditional retirement planning advice, exposes the biases many professionals have about what is best for older adults, and much more.

Rajiv then offers a solution: LifePlanning, his groundbreaking approach to retirement planning. Rajiv explains the essential planning steps and, most importantly, how to develop the framework for these elements to work in concert toward your most deeply held retirement goals.

Your retirement can be the exciting and fulfilling life you’ve always wanted it to be. Start by reading and sharing Rajiv’s important message. And remember, Age On, everyone!

(originally reported at www.kiplinger.com)