you should be doing. At the very least, you will be able to check off items that are already taken care of and then pinpoint those that still need attention. That will help you focus your requests, if any, to lawyers and accountants and save you the cost of spending hours with those advisors. If your lawyer or accountant does not have to spend time educating you about estate law in general, you will be able to use your meeting to zero in only on the issues that pertain to you.
This book will also help you hold a successful family meeting to talk about estate planning. That alone could save you thousands of dollars in fees for mediators or lawyers.
The following are some other practical ideas about maintaining control over costs when dealing with an estate-planning lawyer:
• Ask for a written quote before any work is done. Once you have that, make sure you understand what would cause the lawyer to exceed the quote.
• Understand how you are being billed. It is alright, in fact it is advisable, to ask questions about your costs before the work is done. For example, are you being charged by the hour or for the completed project? If it is for a completed project, make sure you understand exactly what is included. For example, does “estate planning” mean only wills, or are powers of attorney and health-care directives included in the price? Ask whether anybody else, such as paralegals or junior lawyers, will work on your file and what their billable hourly rate is. Also know what taxes will be added.
• Ask whether disbursements are extra and if so, how much they are likely to be for your file. Disbursements are out-of-pocket expenses paid by the law office, such as postage or courier fees. There might also be a set charge for faxes and photocopying.
• Ask if there is any legwork you can do yourself. For example, if the lawyer is going to search the titles to properties, you could offer to get them yourself rather than pay the lawyer to do it.
• If the lawyer calls, writes, or emails you to ask for information or documentation, or you promise to do something, respond as promptly as you can. If you delay to the point that the lawyer has to chase you down, this is likely going to cost extra.
• Understand that requesting rewrites of documents (as opposed to asking that an error made by the lawyer, such as a misspelled name, be corrected) will probably cost extra. The lawyer’s quote given at the beginning of the project is based on the average time it takes to do a project like yours, and if you keep changing your instructions so that the project changes two or three times, you will end up paying more than you were originally quoted.
• If paying a large bill all at once is a problem, ask about payment arrangements. Most law firms take credit cards. You may also be able to pay half your costs up front and the second half upon completion, or set up a payment schedule. Not all firms do this because it is risky for them, but some do, so it cannot hurt to ask.
• Keep face-to-face meetings brief and to the point. One way you can achieve this is to prepare as much as possible ahead of time. If you phone a lawyer to make your first appointment, ask what you should bring to the meeting. Make photocopies to give to the lawyer. Make notes or lists of questions to bring with you to the meeting.
3. Believing That Estate Planning Is Only for Rich People
The word “estate” tends to make people think of enormous homes with fenced acreages and overseas bank accounts belonging to multi-millionaires. The phrase “estate planning” can conjure up visions of corporate empires. In other words, a lot of people think that estate planning is only for the very wealthy. This is not the case. Everyone has an estate, however modest it might be. Legally, the word “estate” simply refers to what you own and what you owe, even if your net worth is in the red. Estate planning refers to deciding what you want to do with your legal and financial affairs while you are alive and after your death. It is simply not true that estate planning is only for rich people.
Estate planning is for everyone. It is important for you to deal with whatever you have accumulated during your lifetime, regardless of whether it has a higher or lower dollar value than someone else’s estate. The fact that you are not rich does not mean that your spouse or children should be stuck with legal and financial problems after you have passed away.
Money is not always at the root of estate lawsuits. Although it may seem strange, estate legal battles are not always fought over large sums of money. That does happen too, of course, but estate battles are often about personal belongings or household items which have great sentimental, as opposed to monetary, value to the deceased person’s family. You do not have to be wealthy to own family photo albums, mementos, heirlooms, souvenirs, or other important sentimental items.
People will fight to keep family items that have sentimental value, as evidenced by hundreds of disputes every year. The idea that estate fights only happen to wealthy people is completely wrong. We hear more about fights of wealthy families simply because the dollar amounts are so large or the families are famous. Unfortunately, the fights happen in every economic bracket.
If a dispute of an estate cannot be resolved among the people involved, it will likely end up being decided by a judge. This means court fees; lawyer’s fees; accountant’s fees; and miscellaneous costs such as process servers, witnesses, and time off work. If a legal battle does erupt over a personal item, it is possible that a modest estate might be completely bankrupted by fees. A lawyer is probably going to charge the same hourly rate to wage a court battle whether the fight is over a multimillion-dollar property or a family wedding ring that is only worth a couple of thousand dollars.
Looked at in the light of possible bankruptcy of the estate, it becomes even more important for a modest estate to be protected by proper planning.
When thinking about estate planning, people also forget that legal documents reveal much more than simply who gets what from the assets. For example, your will and incapacity documents tell you who your parents have chosen to put in charge of their affairs in the roles of executor, attorney (under enduring power of attorney), and health-care representative. If you do not have that information, the end result will likely be delays and confusion. The information about who is to be given legal authority over someone else’s affairs is extremely important regardless of the dollar value.
4. Thinking They Do Not Need to Plan, Based on Anecdotes
One of the worst things people can do for themselves and their families is to make assumptions about how the law applies to them without finding out how it really works. You cannot really blame people for feeling that they are familiar with legal matters, including wills, because they hear about them all the time. Myths, urban legends, and misconceptions about wills are everywhere. Everyone has heard a few stories in the news or anecdotes during conversations at the office watercooler about sensational estate battles.
Movies, television programs, and novels feature stories about the law, including wills. We have all seen them, as they deal with important, fascinating legal dilemmas and are often extremely entertaining. Unfortunately, these shows, which are, after all, only entertainment and not documentaries, perpetuate fictionalized ideas about how wills work. The fact that it makes a good story does not make it true.
Not everyone can tell what is true and what is widely misunderstood or fictionalized for entertainment purposes. In fact, it is almost impossible. The abundance of fictional and semi-fictional stories about wills leads too many people to wrongly conclude that they are “safe” without taking any planning steps at all.
For example, many people confidently state that they do not need wills because they are married and they believe that their spouse will automatically get everything they
