Write It Down: The Importance of Documenting Wishes

October 11, 2020

Everyone knows the importance of estate planning in order to make sure that your family, business, and philanthropic priorities are covered after your death. But there’s more to estate planning than just signing the official documents and sorting out the legal and financial obligations.

The other aspect is more personal — expressing your personal wishes. This could encompass a lot of different things, from your desire for medical care or lack thereof to the way you’d like your family to use your money. Your wishes aren’t necessarily legally binding, but it’s worth expressing them in order to leave the legacy you want to leave. Here’s how to get started.

Advance Care Directives

An advanced care medical directive takes effect when you can no longer communicate your desires, generally in the case of a serious illness or loss of mental faculties. It’s known by a few different names depending on the state, but it encompasses three different types of document:

• A living will, which outlines the type of medical treatment you’d like to receive. This includes whether you’d like to be resuscitated or kept alive artificially, through CPR, a breathing tube, or other treatments.
• A health care proxy, which identifies the person that should be in charge of your medical decisions in the event that you’re not able to make them yourself.
• Durable power of attorney, which assigns other legal rights and abilities to another person. This might include financial transactions, paying bills, selling property, and so on.

The CDC says that among people over the age of 60, about half of Americans have an advance directive, but only about a quarter of their physicians are aware that they have one. It’s not an easy topic to discuss, but there’s a good chance that these are decisions that will need to be made toward the end of your life. The last thing you want is to fall ill late in your life and leave your family with no idea what avenues to pursue.

Your Intentions for Your Wealth

At First Western Trust Bank, we know better than anyone that the purpose of your financial wealth is far more than just increasing the number on the bottom line on your balance sheet. Financial wealth is simply the cornerstone of everything else you value in your life — your lifestyle, your relationships, your business, your philanthropy, and your legacy. In fact, this holistic view of wealth is the foundation of our proprietary ConnectView® approach to wealth management.

When your life ends and your assets are left to the next generation, you don’t want to simply leave them with a check, a house, and the memory of the time you spent together. You want to impart your wisdom to them, let them know what mattered to you, and tell them what you hope they’ll do with the money.

That’s the purpose of a “letter of wishes,” a deeply personal and emotional addendum to a traditional estate plan. In it, you can tell your descendants that you want them to get an education, start a family, get involved in philanthropy, or whatever else matters most to you.

It’s Never Too Early for Estate Planning

Many people tend to think of estate planning as something that can wait until the end of their life. Unfortunately, we don’t always know when that will be, and people’s lives end too soon on a daily basis. It’s a morose subject, but it’s important to be prepared for the unexpected, which means starting your estate planning as soon as possible.

In addition to your wishes, your finances will need to be handed down as efficiently as possible. If estate planning is done carelessly, half of your estate can vanish to taxes, which isn’t what you want. If you start planning far enough in advance, you can transfer ownership of important assets, set up trusts, and pass on the money slowly, avoiding the tax burden that comes with one large inheritance.

If you run a business, you’ll have to consider what should happen to that, too. Do you have a business partner who’s likely to succeed you? Do you have a star employee that can step into a leadership role? Have your children expressed an interest in taking over?

Talk to First Western

The important thing is to leave no surprises. We’ve heard horror stories of high-net-worth individuals who died unexpectedly, leaving their families with no idea how to handle what they left behind, and no one wants that. There will come a day when your spouse or child receives that dreaded phone call, and when that day comes, you want them to be ready to handle what lies ahead.

If you’re ready to start making the hard decisions about what happens after you’re gone, come talk to First Western Trust Bank. We can help you keep your money safe, reduce what you or your family will owe in taxes, and distribute your money to the people that matter most to you. Most importantly, we’ll show you how to make sure that your values and priorities are kept alive long after you’re gone.