There is still time to get critical financial documents in place

With the demands of work, family and daily responsibilities, many of us often prolong, or cast aside, organizing and documenting important legal and financial decisions. Then, when a game-changing life event occurs, such as the current coronavirus pandemic, we wish we had acted sooner.

A local example, which will resonate with most South Floridians, is the story of Joe Robbie, the principal founder and owner of the iconic Miami Dolphins professional football franchise. Despite his extraordinary business acumen, his estate plan ultimately failed.

Upon his untimely death, he had not taken the time to properly adjust his plan for extraordinary assets, such as his NFL franchise and his football stadium holdings. When he died in 1990 unexpectedly, both his iconic NFL franchise and his namesake football stadium had to be sold by his family to pay almost $50 million in federal estate taxes and to provide ongoing living expenses for his family. Adjusting his estate-planning documents before his death could have allowed his family to retain the football team while preserving and continuing his South Florida legacy.

While we are certainly in unprecedented times amid this global health crisis, rest assured that there is still time to get critical financial documents in place or to adjust them appropriately; but you need to act quickly.

Here are some tips on what you can do now to get your financial and estate plans in order:

▪ Review the current status of your financial and estate plans. This is especially critical for older individuals and those who have impaired health. For married couples, you should do a quick inventory of all of your assets, and create a chart dividing assets up into columns based on which ones are owned solely and which are jointly held assets. Do not forget to include life insurance and IRA accounts.

▪ Ensure that you have sufficient cash available to provide for your needs over at least the next six months. You should also develop a plan to replenish cash if you start to run low.

▪ Review your asset allocation to manage your investment risk going forward and to make sure that it aligns with your current financial circumstances. You may not want to sell into these declining markets, but you need to clearly understand which of your assets are at significant risk and then decide how you will mitigate the risks associated with those assets.

▪ Review your will and trust documents to ensure that they reflect your current wishes and take advantage of available income, gift and estate tax strategies.

▪ Consider speaking with your attorney or accountant to help you evaluate your options. Estate planning documents these days are often quite complex, so a call with your attorney reviewing your dispositive provisions in your documents is especially important.

▪ Review your general power of attorney, healthcare power of attorney and living will to make sure they are current and accurate.

▪ Review your titling and beneficiary designations to ensure that the individuals you want to benefit will be the ones who receive the proceeds. Make sure to review the following asset categories: bank accounts, such as checking, savings and money market accounts.

▪ IRA’s. Do the beneficial designations at your death coordinate effectively with your other estate planning documents?

▪ Life insurance policies. Make sure you know who the beneficiaries are at your death and, again, make sure the designations coordinate with your overall estate plan.

▪ Give thought to naming contingent beneficiaries in case the primary beneficiaries pre-decease you.

These simple, but important, steps will ensure that your heirs will be provided for in exactly the manner you wish; that your financial structure is assuming investment risk at a level comfortable for you; and that your cash flow is structured to meet your immediate and future cash needs.

The current global health crisis is on all of our minds, but taking these critical steps now can provide some reassurance.

We are easily in the fourth quarter and the clock is ticking down. We urge you to take the time now to review your financial and estate plans and provide a level of comfort for you and your family amid these tumultuous times.

▪ Donald A. Kress is senior vice president and chairman of the Trust Administrative Committee at Coral Gables Trust Company. He is a past president of the Estate Planning Council of Greater Miami and is a member of the University of Miami Estate and Gift Planning Advisory Board. 786-497-1212 or dkress@cgtrust.com.

▪ John Harris is managing director and chief wealth advisor at Coral Gables Trust Company. He is on the board of directors of the Estate Planning Council of Greater Miami and STEP Miami. 305-443-2544 or jharris@cgtrust.com.

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▪ This opinion piece was contributed by the writers to Business Monday, the business magazine of the Miami Herald.

▪ Have a ‘My View’? If you have a point of view on a business topic you would like to share, consider writing about it for Business Monday. Pitch your idea to rclarke@MiamiHerald.com. Guidelines: Submissions should be around 600 words; should state a topic clearly, with supporting examples; and use examples drawn from South Florida. They should also be accompanied by a photo of the writer, emailed as a jpeg. ‘My View’ submissions that are accepted are published as space allows.

This story was originally published April 17, 2020 at 6:00 AM with the headline "There is still time to get critical financial documents in place."