Estate Planning for Clients with Terminal Cancer
Over the course of my career, I have worked with several clients who knew they had but a few months to live due to inoperable cancer. As a general rule, these clients have been mentally sharp when I have worked with them.
The knowledge that death will occur in the near future causes the client to be keenly focused on making sure their estate planning affairs are in order. It is basic to make sure that the client has incapacity documents such as a living will, health care power of attorney, and a financial power of attorney.
There are numerous financial matters to be considered. Perhaps ownership of assets can be changed to avoid probate or to provide tax benefits. Should gifts be made to children and grandchildren? Should a revocable trust be utilized in order to avoid probate? Beneficiary designations on assets such as retirement accounts and life insurance policies should be verified.
One married client changed the ownership of the house into his name and changed the beneficiary of his life insurance policy to his estate. These steps will provide his estate with enough assets to fund a credit shelter trust. The credit shelter trust will save substantial estate and inheritance taxes upon the subsequent death of his wife.
The estate planning steps outlined above would be equally effective for any client nearing the end of his or her life. Unfortunately, a lot of terminal illnesses incapacitate the client to the point that he or she is not able to accomplish them. The only “good” thing about terminal cancer is that it generally gives the client adequate time to get their affairs in order and to say their good-byes.
