Getting the Most from an Estate Planning Initial Consultation

Getting the Most from an Estate Planning Initial Consultation – Part I

The first step in getting your estate plan established is preparing for the initial attorney consultation.  You should have two goals in mind for the initial consultation: 1) determining whether the attorney is right for you; and, 2) deciding, with the attorney, on the right estate plan.

What do I mean when I say “determining whether the attorney is right for you?”  Well, among other things, do you communicate well together?  Do you understand her?  Does she understand you?  Do the suggestions make sense to you?  Are you comfortable talking to her?  You will likely have some sort of relationship with your attorney for a long time.  You don’t have to be BFFs, but you shouldn’t feel dread or fear when you need to call her.

Helping the attorney guide you to the right estate plan requires a bit of preparation on your part.  Before the attorney can help you decide what to do with your estate, the attorney must have a good idea what your estate is – and so should you. 

Putting this information together shouldn’t take much time.  Most of it is delivered to you by mail or email on a monthly, quarterly, or annual basis.  You just need to gather it up, review it, and make it available to your attorney at the initial consultation. 

Put together a folder with the most recent statement on each of your bank accounts; checking, savings and money market.  Add the most recent statements from any brokerage accounts.  Bring the most recent property tax statement for the real estate you own.  Copy the declarations page from your life, liability, homeowners and automobile insurance policies (the declarations page shows what your coverage amounts or limits are).  If you collect anything - cars, guns, art, action figures - estimate the value of the collection.  It never ceases to amaze me how often people overlook antiques and collectibles when they think about their assets. 

Once this information is in a folder, you are nearly ready to go to your initial consultation.  Next time, we’ll discuss the final step you need to take before meeting with the attorney.

Now is a good time to set up the initial appointment.  This may seem self-evident, but many of us fail to get things done because we fail to take that first small step.  You may know exactly what you want, but if you never meet with an attorney to have your estate planning documents prepared, you’ll never get it done. If you haven’t already done so, pick up the phone and call an attorney experienced in estate planning.  Like me, many offer free consultation.  No cost, no risk to you, other than your time.  It’s a busy time of year, but you can find a couple of minutes to pick up the phone and make the call.  You’ll be glad you did.

Plan for Estate Plan in January

‘Tis (Almost) the Season for Estate Planning

One wouldn’t expect the legal industry to really have seasons.  Not like retail – think Christmas, Easter, Halloween, Back to School, just to name a few.  Summer is a big season for many industries; road building and repair, home remodeling, vacation and recreation.  Fishing season, hunting season; these are well defined seasons that start and stop to the minute.  The legal industry can’t match these, but there are a few seasons.  Tax season, for example.  Those of us that do tax work see a bump up around April 15 (hint – an attorney can usually be of more help in tax planning, rather than last minute compliance issues).  I’m sure my colleagues doing criminal defense work see a bump during the summer when crime also increases.

You might be surprised to learn we estate planners have a season.  No real weather driven season, and estate planners don’t run specials.  So why is there an estate planning season?  I’ll give you a hint – it starts in mid-January and continues until about the end of February.  It appears to be tied to the holidays.  My theory: we spend time with our extended families over the holidays, and that experience reminds us we need to get this task completed. 

Perhaps this was the first year that Mom or Grandma didn’t prepare the turkey, or have the major holiday gathering at her house; the guard has changed, the torch has passed.  Maybe you don’t have children of your own, got a good look at your nieces and nephews, and can’t stand the thought they would get everything for which you worked so hard.  Perhaps siblings, or siblings-in-law, brought up the nightmare situation they went through in their families.  Perhaps someone was eying Grandma’s china as if Grandma had already passed away and the personal possessions were going first come, first served.  Or maybe “Cousin Eddie” from National Lampoon’s Christmas Vacation showed up and stayed a bit too long.

There’s something about spending that much time with our families that just naturally turns our thoughts to death.

Hopefully, you’ve figured out that you can’t change your family.  You’re stuck with them.  If you’re worried about your parents’ or grandparents’ estate plan, by all means make them an appointment.  But you can’t force them to get it done (if you could, the attorney may have some concerns about whether they are actually competent enough to make the estate plan).

Completing your own estate plan is a positive response to what may have been a stressful experience.  So, pick up the phone and make an appointment.  You may be able to get your first appointment before Christmas, finalize and execute your estate plan shortly after the first of the year, and sail forth in the new year, secure in the knowledge that you have this, at least, handled.
I’ll be posting tips between now and the end of the year to help you prepare for your first meeting. 

Remember, they’re your family, and it’s only a few days a year.

New Scam Targets Creditors!

As if the latest development in the home foreclosure debacle (no documents, improper documents, forged or falsified documents, foreclosing on the wrong home) were not enough, we have seen an upswing in so called collection agencies (“scam artists”) contacting business owner-creditors (“creditor”), offering to collect money owed by customer-debtors (“debtor”). Problem is, these collection agencies do collect money from the debtor, but the creditor never sees any of the money collected. To make matters worse, the debtor may have to pay the creditor again.

How the Scam Works

Contractors make especially attractive targets. The mechanic’s liens they file in order to protect themselves are a matter of public record.  The scam artist (almost always from another state) contacts the creditor with a very convincing story about how they are able to collect when the creditor hasn’t been able to.  The creditor may authorize the scam artist to collect on their behalf; some even sign contracts. 

In other cases, the creditor may not authorize the scam artist to engage in collection work, but the scam artist now has enough information to be convincing when contacting the debtor.  Many debtors pay the scam artist believing they are legitimately resolving a debt.

Months, maybe even years, go by with no word.  The creditor then decides to attempt collection itself, or to resume collection if didn’t authorize the scam artist.  The creditor may file a lawsuit to collect, or may simply send a collection letter.

The debtor responds, claiming to have paid the debt, or to not owe the debt (meaning the debt has been paid).  Of course, the creditor doubts this, as the creditor hasn’t seen any funds.  The debtor (assuming the debtor has kept the records) responds with copies of the settlement agreement, canceled check, money order, cashier’s check, or wire transfer.  Almost always, the settlement agreement accepts much, much less than was originally owed as payment in full.  In some cases, the scam artist has actually committed the creditor to complete work which it never agreed to complete, causing the creditor to actually go out of pocket on the collection.

If the creditor did have an agreement with the scam artist or the debtor had good reason to believe the scam artist really did represent the creditor, the debtor is off the hook. Good for the debtor.  Bad for the creditor. 

The creditor now has to pursue the scam artist.  In many instances, the scam artist admits they collected the funds.  They then engage in a delay, stall, ignore and disappear tactic, so the creditor doesn’t get paid.  Too often, when the creditor contacts the scam artist, the phone numbers may be disconnected, the email accounts closed, and mail returned undeliverable.

Even if the scam artist can be found, if they are in another state, it may cost the creditor more than it’s worth to pursue.  In some instances, the creditor may be able to sue in the state where the creditor resides; in others they may have to go to the state where the scam artist resides.  In any event, the creditor will have to use the courts in the state where the scam artist resides, even if they can get a judgment through their home state courts.  This deprives the creditor of capital it could be using to pay its bills, provide jobs, and conduct business.

If the scam artist didn’t have authority, even apparent authority, the debtor may end up paying the bill twice.  While there have always been some debtors who poorly manage their credit or use the current economic climate to avoid paying legitimate bills, most don’t pay because they simply cannot pay, perhaps because they are unexpectedly unemployed.  They may have borrowed money from family members, friends, used title loans or other high interest sources of funds to resolve the debt because the discount offered by the scam artist made such things worthwhile.  The last thing this genuinely financially distressed debtor needs is double the debt.  But that can easily be exactly what they get.

What Can You do to Protect Yourself?

Creditors.  If you carry accounts receivable or have money owed to you, be very wary.  Investigate any collection agency that contacts you with an offer to collect for you.  Keep in mind that it is very simple to set up a corporate or limited liability company identity, including a website.  It is very easy to look legitimate.  Dig beneath the surface.  Check with the Better Business Bureau®.  Run an internet search, particularly on sites with consumer complaints.  Check with your state’s attorney general’s office or consumer protection office.  Make the same inquiries with the state where the collection agency is located.

Consider using only in-state collection agencies.  Check references.  Stay involved in the process, demand frequent updates.  Do not give the collection agency authority to accept offers on your behalf without your express, written approval.  Advise the debtor that their account has been turned over to a collection agency, identifying the agency and the collector assigned to your account.  Let the debtor know you must approve all agreements accepting less than the full amount due as payment in full.  If you have given a collection agency authority to act for you but don’t feel they are getting the job done or that they are not legitimate, terminate their services in writing.  Send a copy to the debtor.

Debtors.  If you are contacted by a collection agency, you should ask the collection agency for written proof they have the authority to represent the creditor.  You can also contact the creditor to verify that the right collector has contacted you; get phone numbers, fax numbers, email contacts, and a person’s name.  Get it in writing.

What if I’ve Already Been Scammed?

If you believe you have been scammed, whether you are a creditor or debtor, you should immediately contact your local state’s attorney general or consumer protection agency. They may already be investigating and prosecuting; you can join in without additional cost to you (other than the time it takes to complete the inevitable forms).  If your state isn’t currently taking any action, check with the state where the collection agency is located.  If neither is taking action, consult with an attorney to see if there is a cost effective solution for you.  If not, or if advised to do so by your attorney, consider filing criminal charges in both states. You may not get your money back, but you may help to prevent someone else from getting ripped off.