Financial planning for death: Vermont experts share where to begin
Making plans for what happens to your assets after your death can feel like a daunting task. There are wills, trusts, probate court and so many potential taxes.
On Wednesday’s Vermont Edition, we broke down the basics of estate planning with two local lawyers who specialize in it, and a doula who helps people navigate these topics, including tough conversations with family members.
Our guests were estate planning attorneys Holly Lemieux in Essex and Jonathan Secrest in Brattleboro, and doula Francesca Lynn Arnoldy. Highlights of the conversation are below.
The top tips from Vermont Edition guests
Every adult should have set up a power of attorney, a person who can handle your finances if you’re incapacitated, and avoid a guardianship process, Secrest said.
If it feels overwhelming, some attorneys like Lemieux offer free consultations to answer questions. Lemieux added that online resources can be helpful, too, but they’re not always giving advice specific to your state.
Parents of young kids should ensure that they have “decent life insurance,” Secrest said. That’s just as important as any other document, if not more, he said.
How do you start?
Make sure that you have named a beneficiary on any financial account you have, including bank accounts and things like retirement accounts. A beneficiary is a future owner who will receive the balance of the account or the ownership of the property after you die, Lemieux said. And you can change the beneficiary at any time.
When you die, anything with a named beneficiary can skip the long and more complex probate court process, Secrest said.
In Vermont, you can also add a beneficiary to real estate by working with an attorney to prepare what’s called an enhanced life estate deed, or a “lady bird” deed. This is helpful even for people with modest means, Secrest said, and helps protect your house if you have to go to a nursing home.
“And so with the deed, this lady bird deed, you can name children as beneficiaries, but you own and control the property 100% until your death, and then it immediately avoids probate and becomes theirs,” Secrest said.
What is a will?
“A will is a list of instructions for the court to follow on who will receive your assets when you’re no longer living,” Lemieux said. Assets may include accounts, life insurance, personal belongings and real estate.
Try to forget what you’ve seen in movies: Loved ones will get copies, but there’s not usually a dramatic reading of the will.
“We don’t get together in a big board room and read anything,” Lemieux said.
An executor will be in charge of administering the estate, paying final tax and utility bills, and meeting deadlines. If you’re named as an executor of someone else’s estate and don’t feel comfortable, you can decline.
What is a trust?
A trust is a substitute for a will that allows people to manage their assets until death, when they pass to a successor trustee.
“At that point the trust acts like a will, but not involving the court,” Secrest said. “So it’s a much simpler, faster, typically less expensive process.”
Another key difference is that wills generally require all assets to be distributed, while a trust can allow them to be managed in an ongoing way, he said.
“If I die and I’ve got young kids, really, only with a trust can I provide that their inheritance stays in trust beyond their 18th or 21st birthday,” Secrest said.
How do you start these conversations with a family member who may be resistant to estate planning?
“It's not uncommon,” said Arnoldy, the doula. “And I encourage people to start with themselves first. So do your own work. First, think about your own estate planning. Think about your own advanced directives, think about your own end-of-life care planning. Start there.”
Then you can approach a family member to talk through your own plans, Arnoldy said.
“Through that interaction, I find that it will in the very least plant seeds and ideas for the other person to then consider their own planning,” Arnoldy said. “If not, they will become engaged in conversation and have this back-and-forth and say, ‘Oh, I hadn't thought of that.’ Or, ‘That doesn't apply to me,’ or, ‘I would definitely want this for myself.’ So it's a great starting point.”
Broadcast at noon Wednesday, Oct. 18, 2023; rebroadcast at 7 p.m.