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LIFE

A 'simple will' not so simple at all

Bernard A. Krooks For the Poughkeepsie Journal

I can't tell you how many times we hear these words from a client: "I don't want anything complicated; I just want a simple will." Those words are actually quite amusing for us to hear, since in the 25 years our law firm has been in existence, we have never had a client who wants a complicated will.

While we hear the "I only want a simple will" request often, what clients often really mean, of course, is "I want an inexpensive will." That is, they don't want to pay a lot for the legal advice or preparation of elaborate documents.

Our favorite variation is the client who wants a simple will, then tells us their assets are straightforward and their family situation ordinary. You know — the half-interest in a vacation home in another state, the investment properties owned by various LLCs, and the closely held family corporation that is worth somewhere between $1,000 and $10 million. And family situation? You know — one child has special needs, another a drinking problem and the third is married to a spendthrift. But the client is just going to disinherit one, split things between the other two and trust the kids to work everything out. Really?

We spend a lot of time at the initial meeting with our clients, so that we can figure out what issues need to be addressed during the estate planning process. Often, additional assets or issues are uncovered as we proceed with the process. Many clients are not as organized as they (or we) would like and this can make the process take longer.

Why do we even care about what assets you own? Is it because we can charge you more if we know how wealthy you are? Absolutely not. We need to know about your assets to figure out whether you have an estate tax issue. Are you pretty sure you aren't worth the $5.43 million that is required before federal estate taxes are a concern? OK — but what about state estate taxes? The current New York Estate Tax exemption is $3.125 million. Some clients can get to that number pretty quickly, especially when they add in the face value of their life insurance policies, vacation homes and other assets. Also, the trust your grandfather left for you, which you don't think of as "yours," may also be includable. This is one of the reasons the initial meeting is so important. Without having an accurate understanding of your assets, it is impossible to do a proper job planning your estate and drafting your documents.

Another reason for the initial meeting is to discuss whether you should have a living trust. Don't worry — we're not going to order you to do anything. There are many misconceptions about living trusts. No, they don't save estate taxes and they won't protect your money from a nursing home. But, they can be useful as an asset management vehicle if you later become incapacitated. Also, if you own property in another state, a living trust might help you avoid probate in that other state. Moreover, some clients opt for a living trust to avoid probate in their home state. Whether this makes sense for you depends on a number of factors, all of which are discussed during our initial meeting.

Finally, at the conclusion of the initial meeting we will be able to provide you with the cost of doing your estate plan. Unless there are extenuating circumstances, we will almost certainly be able to give you a flat-fee to do the work. Sometimes, we will even be able to give you at least a couple of variations for you to consider. Then you can decide how much simplicity you can afford.

How often do our clients really end up with what might be called a simple will? If we get to define "simple," our estimate is about half the time — or perhaps slightly less often than that. But even clients with those simple wills also likely need financial powers of attorney, health care proxies, living wills and other essential documents as part of their estate plan. In many instances, these other documents present their own host of issues that need to be addressed.

Even a short, inexpensive will is not simple. It is a profound document, and it isn't even possible to figure out what it ought to say until we've talked through some of the issues.

Oh, and whether your estate plan is simple or complex, inexpensive or less inexpensive, it should be reviewed and possibly revised every several years or so. But that's a different concern we need to grapple with. First things first: let's get the estate plan done before we start worrying about future revisions.

Bernard A. Krooks, Esq., is a founding partner of the law firm Littman Krooks LLP. He has been honored as one of the "Best Lawyers" in America for each of the last eight years and is a member of the NAEPC Estate Planning Hall of Fame. Krooks serves as chairman of the Elder Law Committee of ACTEC. Contact him at 845-896-1106; visit website at www.elderlawnewyork.com