Each and every one of you has certain legal rights, but many of them don't matter. I first realized this when I watched the movie Liar, Liar, starring Jim Carrey. There's a scene where a towing company scratches Jim Carrey's car, and the towing man asks him what he's going to do about it. Jim Carrey says, "Nothing! Because if I take it to small claims court, it will just drain 8 hours out of my life and you probably won't show up and even if I got the judgment you'd just stiff me anyway; so what I am going to do is piss and moan like an impotent jerk, and then bend over and take it up the tailpipe!"
He has a legal right to be free from vandalism to his car, but he's not going to do anything to secure that legal right, so it doesn't really matter. Of course, in this case it makes sense that he doesn't pursue anything, but there are other situations where it makes all the sense in the world to pursue your legal rights. When the cost of losing a legal right outweighs the cost to secure a legal right, it makes sense to pursue that security.
Here are three ways this relates to estate planning:
1. You may not have immediate access to money and assets if your spouse dies.
I thought about this when I read an article about a woman whose husband died, and the mortgage company threatened to foreclose on her home, repeatedly harrassing her for payment that she didn't have the immediate ability to access. It reminded me of how I hear people say things like, "If my spouse died, I'd just get everything, right?" and, "We have life insurance, so we'll be OK." Maybe, maybe not. Neither of those things are set in stone. It could be that you have to go through a court process to gain access to your spouse's property. It could be that you have to give up some property to your spouse's kids (from another relationship). It could be that the insurance company takes a while to cut you a check, so you don't have enough money to pay the bills for an extended period of time. If having immediate access to money and assets is a concern for you, see a lawyer who can show you what things will look like for you and your spouse if one of you dies.
2. The guardian you want may not be able to serve.
I tell the story all the time about how after my mother died, there were several family members that wanted to adopt me, but they couldn't afford to fly over to Hawaii and pay lawyers to make it happen. If you don't name guardians and make a plan to pay the guardians for the care of your children, it might not be the person you'd choose who your kids end up with. Sure, each family member has a legal right to petition, but not all of them will have the resources to make it happen.
3. Your kids may inherit nothing from you.
You have a legal right to leave your property and money to anyone you want, and yet, I hear about people accidentally disinherting their kids all the time. If you leave everything to your spouse, unprotected, there is no guarantee that your children will inherit anything. Most parents want to make sure something is left behind for their kids, yet the unprotected all-to-my-spouse plan is the one that most people go with when they create a will or trust.
These are just a few examples of situations where practical issues and legal rights collide. The moral of these stories? Get thee to an estate planning lawyer who can look out for these issues and advise you on how to proceed in a way that best protects your family and accomplishes your goals.
To your family's health & prosperity,
P.S. Want to get started on the most important planning you'll ever do for your family? Give our office a call at (503) 235-5150 to get started. You'll be glad you did.