How do we know when to let go? Parents devote years of their lives to their children with the goal of creating independent and competent adults. Doctors, lawyers, entrepreneurs, and even presidents of the United States work tirelessly towards positions that they must eventually relinquish. Many talented people never accept that successfully passing the reins to those more physically and mentally capable requires diligent planning. The alternative is fraught with dangers.
In my experience, clients doom their prospects for a smooth transition with the words “I shall turn my affairs over to my successor when I am ready.” Unfortunately, “when I am ready” usually translates to “when I am no longer competent to do it.” For us as planners there are legal obstacles to this approach. A person needs to have “capacity” in order for us to take orders from him or her. That judgement is difficult to make and often impossible. Frequently, family members fly in from all over the country to meet with Mom or Dad and their attorneys so as to fix the problem ex post facto. This is costly, ineffective, and emotionally draining.
Here are a few ideas to help people avoid expensive and painful succession problems.
- Begin with the proper documents. Most people should have a durable power of attorney (DPOA), advance medical directives, a will, a letter of instruction, and possibly a living trust.
- Give very careful consideration as to whom you shall name to act on your behalf when you are unable. Some considerations are who is the most capable, his or her geographic proximity, and the personal circumstances of the person(s) being asked. Many overwhelmed working parents will take on a job that is too difficult for them out of love. Also, avoid naming too many siblings under the belief that you are somehow treating them equally. Sometimes that works and just as often it creates a state of hostile gridlock.
- Take care to train the person for the certainty of your ultimate infirmity and death. People may be smart and well-educated, but the law frequently does not comport with people’s pre-conceived beliefs. Learning during difficult and emotional circumstances is rarely good and letters of instruction are a great way to help your successor. We will gladly provide a template to clients and we have the experience to help with this.
There is a natural progression to our lives that is often ignored. When we try to do what we were good at when we were young, we will likely fail and be unhappy. Business leaders need to become mentors to young talent as they mature. College professors may move from research and publishing to teaching and mentoring. Politicians should give up the partisan fight and become elder statesmen. When parents let go, they remain the go-to source of wisdom for their adult children and grandchildren. The timeless advice is that there is “a time to get, and a time to lose; a time to keep, and a time to cast away.” If you prefer The Byrds:
To everything (Turn, turn, turn)
There is a season (Turn, turn, turn)
And a time to every purpose under heaven
We are not lawyers and we do not practice law. We do care about our clients, and we are here to help. Call us with any questions you may have.
* https://www.biblegateway.com/passage/?search=Ecclesiastes%203&version=KJV.
** The Byrds "Turn! Turn! Turn!" Released 1965. Originally written by Seeger, P. 1962.