King Lear, Shakespeare's most tragic character, had a crazy estate plan.
Lear would abdicate his throne, and then divide his lands among whichever of his three daughters flattered him most. One loyal daughter refused to play the flattery game so Lear banished her. The other two poured on the flattery, took his lands, and then threw him out.
Upon discovering both were having an affair with the same man, one of the flatter daughters poisoned the other, then stabbed herself to death. Meanwhile, the loyal daughter was executed by mistake. Lear now broken, abandoned and demented, began to converse with mice.
King Lear's sorry end personifies what aging clients most dread: Lear died broke, sick and senile, his family a train wreck, his legacy to be forever remembered as a vain buffoon. Aging clients want what eluded poor Lear: financial security, attentive health care, a connected family at peace, and a positive legacy by which they are remembered.
Financial Security
An aging client confides, "I'm afraid of running out of money before I die." Estate advisors should first address this primal fear of aged impoverishment. Once relieved of this lifetime concern, the client can focus on avoiding death taxes. Some aging clients
do run out of money before they die because, like Lear, they've improvidently passed on property prematurely.
In my experience, a common obstacle to succession in family business is the senior generation's unspoken fear of impoverishing themselves in old age. The younger generation are unproven managers whose plans may be as crazy as Lear's. Or the senior generation's plan may be crazy too, e.g. continuing huge unearned salaries, perks and benefits for life — a long term liability the company can ill-afford.
Attentive Health Care
"Who will take care of me when I can no longer care for myself?" The family is the primary support group for its aging members. I urge families to discuss carefully how they will cope with members' inevitable declining health. A health care power of attorney and living will are important, of course, but not nearly enough. Who will convince an aging parent to give up driving? Who will assure that the physician has been understood, that prescriptions are taken as directed, that good nutrition and exercise are available and encouraged, that the retirement facility lives up to its bargain? Health concerns in old age are not only a family concern, but a whole family undertaking. Lear's loyal daughter suffered acute caregiver burnout while her flatter sisters cavorted.
Family Peace
"I'm not going to finance a family fight when I die!" declared a very thoughtful client. In the vain pursuit of flattery, poor Lear did just that. It was shear buffoonery to stage a flattery contest with huge prizes that overheated murderous sibling rivalries. Surely Lear didn't assume such a competition could
promote family peace.
In my experience, the estate planning community is thrown off balance by contentious families, e.g. by adult sibling rivalries running out of control. Tax avoidance and financial products seldom provide an antidote for such hostilities. Nor does estate planning in secret, where parents are encouraged to leave children what they ought to want without asking or forewarning them.
Fortunately, intergenerational estate planning is catching on. The family as a whole, parents and children, givers and receivers, talk openly about what the parents have and what it's worth, who would like to inherit it, and how the inheritance should be managed. Along the way they discuss the roles of executors, powers of attorney over parents' assets, health care powers, and whether Mom would
really be the best choice for those fiduciary offices. Quite often Mom discourages her appointment, further suggesting that others speak to Dad about no longer driving when the time comes.
Senior clients need the comfort of family peace during their later years. After they are gone, they want their estates to be enjoyed by peaceful survivors whose recollections and reminders of their parents' largess are themselves, peaceful memories.
"How Will I Be Remembered?"
Beginning in their sixties, increasingly in their seventies, and overwhelmingly in their eighties, senior clients are concerned about their "legacy" — how they will be remembered. Dad might not get much professional encouragement about leaving a legacy of peace to warring children. "Give it to charity if they can't get along" counsels one advisor. "Tie it up in trust" advises another.
Dad doesn't want to "finance a family fight". If necessary, he'll reluctantly play the role of peacemaker, and won't mind being remembered as such. He fantasizes about his children reminiscing after his funeral:
"Dad didn't want his money to divide us."
"He stayed on us until we buried the hatchet, or at least locked it away.
"I guess he was right that parenting never ends."
"In his eighties and still dishing out tough love!"
"I've got to admire him for that."
Lear's loopy plan — land for flattery — was doomed from the outset. He failed as a king and as a father with such colossal grandiosity that Shakespeare immortalized his folly. Aging clients want what eluded poor Lear: financial security, attentive health care, a connected family at peace, and a positive legacy by which they are remembered.
