Test Your Estate Planning Knowledge

by Attorney Rebecca S. Spinner

How much do you know about estate planning? How prepared are you and your family? Take this short quiz to test your knowledge and perhaps learn something new!

Question #1

True or false? You must name the same person to make both your financial and medical decisions on your behalf.


False. When choosing your trusted decision makers, you should select individuals based on their strengths. In other words, you should consider what characteristics or traits each decision-making role requires and select the people who have those traits.

An ideal person to select as your Healthcare Agent is someone who:

  • Knows you well. A spouse/partner, a family member, or a close friend…all are good candidates.
  • Excels at making difficult decisions under pressure.
  • Is diplomatic and empathetic – critical traits for balancing the needs, wants, and unpredictable emotions of a patient and their loved ones.
  • Isn’t afraid to ask tough questions, which invariably arise when discussing a dying individual’s end-of-life care.
  • Is easily reachable by email, phone, and/or text.
  • Is or can easily be within physical proximity of where you’re likely to receive care (this isn’t a requirement, but can be very helpful when emergencies arise).

Once you have identified who you’d like to be your Healthcare Agent, you should talk to them about the care you do or do not want to receive if you are incapacitated or dying. Have multiple conversations about your wishes and make sure you are heard and understood. You may also choose to execute a document known as an Advanced Directive (sometimes referred to as a Living Will or Personal Directive). This is a document where you can write down your wishes for a variety of scenarios. The Advanced Directive covers everything from where you want to live, to whether you want life support in a particular situation, to who you would want to take care of your pets, and more. If you are interested in preparing this document, feel free to reach out to our office to set up a consultation.

For financial and legal decisions, you may want to select someone with a different skill set. The best choice is someone you trust implicitly. Integrity, not financial acumen, is often the most important trait of a potential agent. Since your power of attorney will be in charge of handling your legal and financial affairs, you may want to choose someone who either has some experience in these fields or has the personality and financial savvy to handle the decisions that may fall to them.

Choose someone who:

  • Is trustworthy and fair minded.
  • Understands their duties, and is committed to taking those duties seriously.
  • Understands your wishes and your values.
  • Demonstrates loyalty to you.

Never forget that you are giving your Power of Attorney the opportunity to access all of your assets, including checking and savings accounts, at a time when you may not be able to keep tabs on what your agent is doing. Unfortunately, we have seen too many examples of the child, step-son, nephew, niece, and family friend utilize a Power of Attorney, not for the principal’s benefit, but for their own.

Choose your agent wisely, and make sure you understand the breadth and scope of the powers you are giving. Regardless of the role you need them to play, be sure to choose someone who has both a willingness and capacity to serve. Encourage the person to be honest if they do not feel that they would be the best choice for the role. The last thing you want is for someone to say yes to being your Power of Attorney or Health Care Agent when in reality the role would end up being too overwhelming for them.

Question #2

True or false? If I do not create my own estate plan or if my plan fails to provide for my current situation, my state’s law will decide what happens.


True. Every state has default laws that kick in if a person has not made their own estate plan. These laws are designed with a “one size fits most” situation in mind. For example, if you are married, your spouse will usually have priority with regard to making decisions and receiving your property because most married people would choose their spouse if they had prepared beforehand. However, there are innumerable reasons why you may not want your spouse to make certain decisions or receive certain items of your property. You may want to include charities, or a niece or nephew, or maybe a friend. You may not be married and would not want your property to pass under the default laws of the state. For these reasons, it is essential that you create your own estate plan and make your own decisions. If you do not make a plan in advance, your family will almost certainly have to deal with the court system, whether during your incapacity, or after your death. If you have not created or finished your estate plan, now is the time to stop procrastinating and make an appointment with us to complete it.

If you have an estate plan, consider reviewing it in case your existing estate plan does not accurately reflect your current situation. For example, perhaps one or more of the people you chose as your trusted decision makers or beneficiaries are no longer living or able to serve, or there may be other people (e.g., a new child or a new spouse) who you want in those roles instead. When you experience a significant life event such as a marriage, divorce, retirement, change of occupation, or birth or death of a loved one, a change to your estate plan may be necessary.

Even if nothing in your life has changed since you last looked at your estate plan, the ever-changing laws governing taxes and estate planning may necessitate an update to your estate plan. A periodic review with your estate planning attorney is a great way to ensure that your plan is up to date, and will give you peace of mind knowing that your plan will work as anticipated when the time comes.

Question #3

True or false? A Will accomplishes all of the same goals as a Trust, but a Will is cheaper.


False. While both a Will and a Trust can give instructions about how you want your property to be distributed upon your death, one of the biggest differences between a Will and a Trust is that a Will has no effect until the time of your death. A Trust, on the other hand, can be utilized to deal with a period of incapacity (a time where you cannot make or communicate your wishes) that may occur prior to your death, which can be very helpful for loved ones trying to care for you. For example, son wants to sell mom’s home to help pay for the cost of an assisted living facility for her. If mom only has a Will, then son has no power to sell the home and must go to court to be given the authority to act on mom’s behalf. This situation might be avoided if son was named as an agent under mom’s durable power of attorney, but relying on this as the only method can sometimes be problematic. On the other hand, if mom’s home was owned by her Trust, then son, acting as Successor Trustee, would have the power and authority to sell mom’s home without court permission.

In addition, only executing a Will guarantees that your loved ones will have to go through the probate court process upon your death. The personal representative (formerly known as executor) who you have named in your Will must be approved and appointed by a probate court to have the power to deal with the property in your estate. The probate process is public, time consuming, and can often be costly for your family. On the other hand, when you set up a Trust and properly fund it, your Successor Trustee can immediately step in and deal with the property in your Trust without any court involvement, wait time, or much additional cost. Trusts can also have many other benefits, such as asset protection for your beneficiaries, estate tax savings, money management for beneficiaries, and so much more.

Question # 4

True or false? Only wealthy families with a high net worth need a Will or an estate plan.


False. If you want control over what happens to your assets when you die, you’ll need, at a minimum, a Will to name who gets what. If you die without a Will, state law determines which of your relatives will inherit from you. Additionally, it cannot be overlooked that much of an estate plan is designed to support you while you’re still living. The foundational documents (Healthcare Proxy, HIPAA Authorization, Durable Power of Attorney, and Advance Directive) are meant to assist your loved ones in providing care and support to you if you experience an incapacity / medical event.  Certain Trusts can be crafted to serve a similar purpose in managing your assets as in the example in the answer to question # 3.

Question # 5

Which is better, an Irrevocable Trust or a Revocable Living Trust?


It depends. Both Irrevocable Trusts and Revocable Living Trusts can accomplish the goal of avoiding probate on some or all of your assets, but which Trust is right for you will really depend on your personal situation and the goals that you are trying to accomplish. An Irrevocable Trust might be a good fit for you if one of your goals is to protect your home or particular assets from the cost of your future long-term care. A Revocable Living Trust might be a good fit for you if you want to maintain complete access to and control of your all of your assets during your lifetime, but you want to avoid probate for your family. Some families may set up both types of Trusts if their situation calls for it. If you want to get more information about which Trust would best suit you, please reach out to set up a free consultation with one of our Estate Planning Attorneys.

How did you do?

No matter how well you did with this quiz, it is always a good time to ensure that you have a custom designed plan in place with carefully selected and trusted decision makers. We can help you create or update your plan to ensure that it will work as you intend when the time comes. Please reach out to our office to set up your free consultation so that we can help you come up with the best possible plan for you and your family.