by Michigan Estate Planning Attorney Sean O'Bryan
I had a client a few years ago who came to me and was concerned about whether his son would do a good job handling his estate when he was gone. I told him why wait until you are gone to find out. He looked puzzled. "Are you asking me to die soon?" I said not at all - but why don't you put your son to the test.
The point was, challenge him with a financial responsibility. I found out that this family shared some hunting property. The father kept a small bank account for the taxes and other payments. He alone paid the bills and actually footed the bill. I suggested he sit down with his son, and put him in charge. Have him organize the use and expenses related to this property between himself and his siblings right now - while the father was there observe and assist.
This can accomplish several things. It establishes the child you have named in your estate plan as the person in charge. It allows that person to get used to the bookkeeping responsibilities and the need for communications between himself and your other heirs. It also allows you to take corrective action if the job isn't being done right, it gives you one less thing to worry about - and you'll be able to quietly test the person you have selected to be your successor trustee.
Why this approach works so well is that it creates a pattern of behavior hopefully teaches your successor just how you want things handled. You most likely will find that your selected trustee does a great job, and you will have the confidence that you made the right choice for your family. If things don't work out, you can quietly change your estate plan.
This same approach can be applied to all kinds of situations. I have families with farms, businesses, cottages Up North, or many other situations involving money management. I realize not every family has these "ready made" opportunities. But the same approach can be used when there isn't a family venture.
I have a client who was widowed that liked what i was saying, but simply didn't have any idea what to do. I suggested they set up a joint investment account with local broker. Now, she and her daughter pick stocks together, and have even included the granddaughter. My client had never had an interest in investing. She started doing this to ensure her daughter would have the confidence to handle her affairs as she got older and passed on. In addition to calming those concerns, this has turned into a way that they have all bonded and learned something in the process.
The idea for this came from my father. When I was still in college, my father invited me to a one day workshop on investing conducted by a brokerage firm at General Motors Tech Center. He and I started an investment account together. It was something we did together. Years later, my father-in-law and I did the same thing, and had the good fortune to purchase some stock in Apple Computers long before the iPhone. We have chosen some duds along the way as well. But that is all a part of the learning experience.
The lesson is simple: It is never too soon to soon to give your heirs a trial run. It will instill confidence in them, and create a positive memory. More importantly, when the day comes that they have to exercise good fiscal management skills, you'll know they are ready - and so will they.