Often, people think they’ll have a warning before death and they’ll be able to plan once they get the warning. They think of life almost like a traffic signal. They think they are born with a green light. When they get old or get a serious illness it turns yellow. When death is imminent, the light turns red and they die. They think they’ll plan once the light turns yellow.

Unfortunately, we don’t always get a warning. Sometimes the light can go directly from green to red. Death without warning can come from a variety of causes, both natural and unnatural. Of course, few are surprised when someone in their 90s dies suddenly. But younger people die suddenly, too. For example, sudden cardiac death alone claims about 325,000 people each year according to the Cleveland Clinic. The victims of sudden cardiac death are most frequently in their 30s or 40s. Suicide is the second leading cause of death of those between 10 and 34 years of age according to the National Institutes of Mental Health.

Tragic domestic and international terror attacks impact a wide range of ages, as well. For example, the 22 dead from the El Paso domestic terror attack ranged in age from 15 to 90. The 50 dead in the Orlando Pulse nightclub domestic terror attack ranged in age from 18 to 50. The 58 dead in the Las Vegas domestic terror attack ranged in age from 20 to 67. The youngest of the nearly 3,000 dead from the 9/11 terror attacks was age two.

Sometimes people seem to think that if they don’t plan for death, it just won’t happen. In fact, 58% of American adults have no will, no trust, and no estate plan at all, according to a recent study by Caring.com. Unfortunately, whether you plan for it or not, death is inevitable.

If you don’t plan for death, the state of your residence has a plan for you. Unfortunately, it’s a one-size-fits-all plan for people in your situation. If you have kids and a spouse, it may go half to your spouse and half to be shared among your children, depending upon state law. If you don’t have a spouse or children, it might go to your family of origin. It would go outright to the specified individuals if they had legal capacity. Otherwise, a guardianship/conservatorship typically would be required.

Unfortunately, this often results in assets going to people other than those you want to benefit or in ways you didn’t want.

For example, John died suddenly. He left a spouse, Mary, and two children, Bobby and Susie. In his state half the assets go to Mary, but one-quarter of his assets would go to each Bobby and Susie. Bobby is a minor and Susie is an adult with special needs but has capacity. Bobby’s share would need to go into a guardianship/conservatorship. Susie’s share would be problematic because it would be considered an available resource. Susie would need to put her share into a “first-party” special needs trust in order to keep her public benefits. Unfortunately, at Susie’s death, that trust would need to payback the state for any benefits she received during her lifetime.

As you might imagine, Mary was quite distraught by John’s death and the surprise of all these legal complications, delays, and expense. If John had planned, he could have avoided much of this expense and complication. He could have left all his assets in trust for Mary for her lifetime and then upon Mary’s death the assets could have split into trusts for Bobby and Susie. Susie’s share could have been placed in a third-party special needs trust and would not have required a payback provision.

The unexpected happens every day. It’s best to have a plan in place to take care of the ones you love.

Stephen C. Hartnett, J.D., LL.M.
Director of Education
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com