Procrastination & Rationalization
by Karl Sisson, Director of Development
The Heritage Group

March 2008 - A few months ago, I was in Home Depot searching the shelves for a solution.  Here I was, the middle of winter, and trying to deal with house issues related to the cold weather.  I got into a conversation with a gentleman who was also looking at weather stripping when he asks, “Why do we wait until it’s this cold outside before we deal with a problem?”  I laughed, and answered, “Sometimes, I guess we just need the problem blowing in our face before we act!”

As I drove home, it struck me how similar this is to estate planning.  Statistics tell us more than 70% of all American adults have no estate planning documents such as a Will, Trust, or Power of Attorney.  I suspect the main reason for this is simply procrastination.

Why do people procrastinate, especially when it comes to something as fundamental as their estate planning?  Because it is human nature to avoid unpleasant experiences and people.  The companion to procrastination is rationalization.  We have an uncanny ability to rationalize our procrastination, commonly in the form of excuses.  Here are a few representative excuses to postpone proper estate planning, along with tongue-in-cheek responses to each of them.

We don't have time, because we are getting ready to do some traveling.  Unfortunately, most people spend more time packing their luggage than they do making proper estate plans.

My kids can't get away from work to come with me for an initial consultation.  Perhaps it is best to wait until you are incapacitated or deceased so your kids can take personal time from work and/or from an already crowded family calendar to sort through your assets, squabble with their siblings, hire an attorney, and develop an almost first-name relationship with the probate judge.

Since my children all get along, there's no need to bother with any planning.  You may be right.  They will certainly know your special wishes regarding the non-profit organizations/ministries you wanted to support, your home, your bank accounts and your investments, not to mention your one-of-a-kind heirlooms like those over which you and your siblings fought after your parents passed away.

We don't have an estate tax problem.  Why, my business has no value without me.  Perhaps, but the IRS may not agree with you, especially given your inventory, equipment, real estate, loyal customer base, and goodwill.  Aside from potential estate tax problems, what plans have you made for the continuation or sale of your business?  What you have worked decades to build could crumble in a few months or be sold for pennies on the dollar to satisfy the IRS and intra-family inheritance conflicts.

It's too expensive.  You have spent a lifetime building your wealth, by working hard and making a good return on your investments.  Doesn't it make good business sense to invest several thousand dollars in professional fees now to save potentially hundreds of thousands of dollars in unnecessary taxes, protect your financial legacy (both from and for your children) and preserve family harmony later on?  What price tag can you put on that kind of peace of mind?

We have all heard tragic stories about fortunes lost and families torn apart upon a parent's incapacity or death, often due to poor planning or no planning.  Conversely, you will enjoy greater peace of mind when you overcome procrastination through the estate planning process.   Once your plan is implemented, it must be properly maintained as important changes inevitably occur in your life, the lives of your loved ones, and to the nature, value and mix of your assets.

So, don’t procrastinate, rationalize, or offer excuses any longer.  Contact an estate planning professional today and give yourself the peace of mind you and your family need.