Survey – Majority of American parents have a will
Fifty-six percent of American parents have a will or living trust, according to a recent survey.
The poll, released by Caring.com on April 22, also revealed that 52 percent of adult children don't know where their parents keep their estate documents and 58 percent of them don't know what's in those documents.
One expert said communication is key.
"Communication is very, very helpful in terms of letting their families know that they have executed documents, where they are, who they should contact, and even to the point of sharing some of the information, particularly in passing on some of their values after they are no longer here," said Joseph Goldman, a partner and head of the trust and estate practice at Pashman Stein in Hackensack.
And while the majority of parents do have wills, 27 percent said they do not, according to the survey.
Goldman said while the creation process is not an an onerous one, some people shy away from it because they associate a will with feelings of mortality, which is something they do not want to confront.
"I would say that even for clients that come to do some estate planning, there is often a great reluctance to speak about these things with their children," Goldman said.
In some cases, Goldman said it could be for psychological reasons, in others, it's because parents don't want their children to know the full extent of their assets for fear it might impact the drive of their children.
Goldman said some people might turn to what he labeled "will substitutes," for example, people using joint property or beneficiary designations. "They think that takes care of their estate when it does not necessarily do so."
And while some people may shy away from creating a will, there are a lot of advantages to having one, according to Goldman.
In some cases, the state may need to make decisions for those estates that don't have wills. "If you don't have a will, then the state mandates who the property passes to, and that may be somebody that you absolutely would not want to get the property," Goldman said.
Wills can also be used for tax planning, to name executor, to appoint guardians for those with minor children or to create a trust for minor children.
For those that do have estate documents, many fail to update them. According to the survey, 40 percent have updated their wills in the last one to five years, and 24 percent of adult children don't know if their parents' will has ever been updated.
Goldman said its important for people to talk with an estate planner to determine what type of documents they might need.
"I think that there is a feeling of satisfaction when one does this that 'I have taken care of something that I should take care off and I have provided a safety net for my spouse, my kids and my family,'" Goldman said.