Lack of Information Frustrates Estate Administration.

In addition to signing all necessary estate planning documents to put one’s affairs in order, it is necessary to consider what additional information will be needed by the persons carrying out the estate plan when the time comes.

First, it is necessary for the individual named to carry out the estate plan to know that there are estate planning documents in place, where those documents are kept, and how to gain access to them. Without such basic knowledge the family of an incapacitated or deceased person will not even know on what path to proceed.

For example, take the son of an incapacitated mother who did not know that she had transferred her financial assets to a living trust and did not know where her trust document was kept. Thus, he did not know that such planning was in place and proceeded with a court conservatorship proceeding in order to gain control over the mother’s assets to pay for her care.

The conservatorship was unnecessary under the circumstances, but the son did not know this. Eventually, the son contacted an attorney and the mother’s estate planning documents were located. The takeaway is to tell the appropriate person(s) that you have estate planning documents and where they are kept.

Second, estate planning may include designating death beneficiaries to bank, brokerage and life insurance assets. This work typically does not involve the estate planning attorney as the beneficiary forms are provided by the financial institution to the customer to complete. The disconnect between the estate plan prepared by the attorney and the death beneficiary forms prepared by the client/customer means that the estate planning binder oftentimes does not disclose the identities of the account(s) and the death beneficiaries.

It is wise, therefore, to keep copies of the designated death beneficiary forms inside the estate planning binder (or other compilation of estate planning documents) so that the person administering the estate knows about such non-trust assets and knows the identities of the death beneficiaries. These beneficiaries will then be told to contact the financial institution to request the beneficiary claims package.

For example, take the decedent who has his affairs in order except that the successor trustee discovers a retirement plan account and cannot ascertain who is the death beneficiary. Is the beneficiary the decedent’s trust, an individual beneficiary or is it a charitable beneficiary? Unfortunately, banks and brokerages will only provide account information about a decedent to a court appointed personal representative; this means opening a probate proceeding.

The successor trustee managing the decedent’s trust may try various hit or miss attempts at guessing who might be the designated beneficiary and having such person(s) contact the bank or brokerage to make a claim as the death beneficiary. Alternatively, the situation may end up only be resolved by opening a probate that is otherwise unnecessary as death beneficiaries were named and so normally avoids probate.

Third, some valuable or sentimental assets may be stored in undisclosed (hidden) locations. Unless the person administering the estate knows where and how to access such valuables, it is possible that such assets will be lost due to want of knowing where they are.

For example, consider the parent who hides valuable gold bars for their protection. The parent dies unexpectedly before telling his child where the gold bars are located. Such unfortunate results may occur if someone takes it for granted that they will get to disclose such information prior to death but are not yet ready to do so presently. That approach is risky business.

In sum, consider what is important. Practical information about one’s estate planning and assets needs to be provided in advance to the person who will be administering the estate. This increases the likelihood of a successful administration down the road.

The foregoing brief discussion is not legal advice. Consult a qualified estate planning attorney for guidance. Dennis A. Fordham, attorney, is a State Bar-Certified Specialist in estate planning, probate and trust law. His office is at 870 S. Main St., Lakeport, Calif. He can be reached at Dennis@DennisFordhamLaw.com and 707-263-3235.