What is the worst-case scenario if I don’t plan?

This is a question that was raised to me several years ago by a client, and I answered her question by walking her through what would happen if she did not have a plan, and she became incapacitated from a financial perspective as well as from a medical perspective. I also answered the question about what would happen if she died. My client was married with three children. Her husband had two children of his own, and she certainly loved them and treated them like her own for all intents and purposes.

Unfortunately, she did not see the need to do planning ahead of time, and the worst-case scenarios that I set forth to her are exactly what happened. She became incapacitated a few years later and had a stroke. While she was in the hospital, her children and her husband were disagreeing about the healthcare decisions that should be made on her behalf. To further complicate things, the stepchildren showed up at the hospital also arguing that they should be involved in the decision process.

There is a healthcare statue in the Commonwealth of Pennsylvania that does provide the next of kin and who would make healthcare decisions, but, ultimately, the hospital did not want the husband and his children along with the stepchildren to be fighting in the hospital, so they asked them to go to a guardianship hearing and have a judge adjudicate who would be the guardian of her healthcare decisions. There were a decent amount of assets in her name alone, and, unfortunately, the husband was not able to access them because she did not have a financial power of attorney in place.

He went to the bank trying to explain the situation but, ultimately, was told that he had to obtain a guardianship Order from the Court in order to be able to make decisions on behalf of his wife. The husband ended up in court fighting with his children that he had with his wife along with his children to another relationship, fighting over who should be granted guardianship of her. He ultimately won after having to hire an attorney and spent thousands of dollars in legal fees.

She passed away and did not have a Will in place. I think everybody, including her and him, incorrectly believed that the husband would get 100% of the assets. I did explain to her the worst-case scenario under the Pennsylvania Intestate Succession Statute that the husband would be forced to get the first $30,000 and then have to split the remainder with the children that he had with his wife. Because of all of the strained relationships that occurred under the fighting that they had in the hospital and in the Courtroom, tensions were high, and they did not get along. The husband was devastated to learn that he only got the first $30,000 and one-half of the remainder. He asked his kids to please gift the money back so that he could have it to live the rest of his life, and they laughed in his face and kept the money that they were entitled to under the statute.

Unfortunately, this scenario is far too common. As an estate planning and elder law attorney, I tend to live in the worst-case scenario world because that is what typically happens. If you plan, you avoid all of these circumstances and situations from arising. If you do not plan and you allow yourself to be subject to the government or the state’s rulebook, it may not go the way that you want it or the way that your family wants it.
I think often about that day where I met with her and discussed the worst-case scenario. Clearly, I didn’t scare her enough or do enough to make her realize how devastating that could be for her family. I am saddened over the tension in the relationship now with the entire family and know that I could’ve easily eliminated all of those fights and arguments and the need to go to Court and spend thousands of dollars of money. My goal now is to show the worst-case scenario and hope that it hits home with at least one person who will get their planning in place ahead of time so that this does not happen to them.

If you would like to learn more about how you can plan properly to avoid these and many other complications, please give our office a call at 717-845-5390.