An Unpleasant Thought

One of the most unpleasant questions I have an opportunity to raise in my planning meetings is the discussion of a family disaster. For purposes of estate planning, I personally define a “family disaster” as the death of all of the immediate beneficiaries in a plan. In the example of a married couple, it would be their death and the death of all of their lineal descendants. In many cases this is an unlikely event, but it does happen (often in the form of a small plane crash).

Many people do not plan for this eventuality in their documents, but because it could happen, I feel it is important to address. For example, I am married and have two young children. We frequently travel together as a family and therefore there is a higher risk that my family will utilize our disaster clause, as opposed to a family with six children and twenty-two grandchildren.

You have the opportunity to provide for a number of individuals and/or your church or favorite charity. One common option is to split the estate between the wife’s heirs at law and the husband’s heirs at law. “Heirs at law” may also be described as an individual’s next of kin.

As the years go by, the family disaster issue will become less relevant, as in all likelihood, the family will grow and your children will have children, etc. thereby increasing the pool of potential beneficiaries.