Legal Trends In Estate Planning 2023: Part 2

Q & A with Michael Shapiro and Anne Rhodes

This is the second half of a series of discussions between legal experts about the trends they’re seeing in laws relevant to Estate Planning for 2023.

The responses have been edited for brevity.

Michael D. Shapiro, Esq. (MS)

Vice President and Wealth Planner at Brown Brothers Harriman (BBH), a financial institution with expertise in Private Banking, Investment Management, and Investor Services. In that capacity, he advises ultra high net worth families on complex strategies for wealth transfer and business succession. Prior to joining BBH, Michael was a practicing estate planning attorney in the New York office of McDermott Will & Emery LLP, the only Band 1 law firm in Chambers’ rankings for Private Wealth Law in the USA.

Anne Rhodes, Esq. (AR)

Vice President, Head of Legal at Wealth. Prior to working at Wealth, she was an estate planner in the San Francisco office of Perkins Coie LLP and a tax attorney in New York City. Most recently, her practice focused on complex tax planning for families with cross-border concerns and families with first-generation wealth.

Question 4: What changes would you like to see in estate planning moving forward?

MS: Wealth is leading the charge in the change I’d most like to see, which is greater access to estate planning. Many people don’t think they need an estate plan. Unfortunately, they’re wrong. If you don’t decide during your life how your property will pass after your death, state law will determine how your property passes—and you may not agree with it.  For instance, if a married New Yorker with children dies without a Will, her spouse will receive $50,000, and the remaining property will be split 50/50 between the surviving spouse and children.  Many people would prefer that all of their property pass to the surviving spouse.  You need an estate plan to ensure the result you desire.  This applies to unmarried individuals without children as well: you may not want your property to pass in accordance with the default law of your state.  Everyone needs an estate plan.

Others are intimidated at the thought of estate planning, either because they don’t want to think about death or because of the costs of hiring an attorney.  Here’s where change is needed.  We need to leverage technology to make the process of designing a personalized estate plan less painful and less expensive.  We also need to include this service as an employee benefit, similar to health insurance and life insurance.  I’m hopeful that platforms like Wealth can fill this need.

AR: I couldn’t have said it better.

As the Wealth State of Estate Planning report suggests, it is too often the husband in a white, urban or suburban household who thinks to put an estate plan together. We need to change that mindset. I want state legislatures to allow wills to be signed electronically and notarized online, which would help folks living in rural communities where notaries are not easy to find. And I want tech solutions that empower younger lawyers and lawyers who have connections to underserved communities by providing software to lower overhead costs, including drafting of high-caliber legal documents.

Lastly, I want women to realize that they have a huge role to play in their family’s estate planning process. Estate planning should be a process that empowers you. You should feel that you got a say in preserving your family’s legacy, understanding where and how your family’s assets are owned, and who will step into the many places you fill within your family once you are gone.

Question 5: If you could get any legislation passed in the state where you practice, what would it be?

AR: I’ve already hinted at this, but I would like more state legislatures to allow digital Wills, Trusts and powers of attorney, to be signed electronically, and to allow for remote notarization of legal documents. To me, requiring in-person witnessing and notarization, and hard copies of original documents, is an issue of access. And the traditional concerns regarding validity of the documents are far outweighed by access, now that modern technology provides more secure methods for ensuring validity.

MS: As I mentioned in the first question, many states have revised their laws in recent years to make their jurisdictions more trust-friendly.  My practice was based in New York, which has resisted updating their trust laws.  I’d like to see New York adopt the Uniform Trust Code and the Uniform Directed Trust Act, which are model laws drafted by lawyers, legislators, judges, and legal scholars intending to bring clarity and stability to areas of statutory law across jurisdictions. 

The Uniform Trust Code has been enacted in 36 states and the Uniform Directed Trust Act has been enacted in 16 states.  Both sets of uniform laws are being considered in New York.

Question 6: What is an area where you feel like estate planning might be falling short of the pace of modern culture?

MS: The law generally lags behind the pace of innovation, and estate planning is no exception. As we touched on in earlier questions, the law around digital assets is not settled, and many courts struggle in trying to apply laws designed for tangible property to digital assets.

The best practice for estate planners today is to address these types of property in estate planning documents rather than waiting on state legislatures to address the issue or hoping courts can figure it out.

While we are getting more comfortable using DocuSign and similar digital platforms to sign contracts and other important documents electronically, most states still require estate planning documents to be signed in the physical presence of witnesses and/or a notary to confirm that the person signing the document is competent to do so and does so of her own volition. We need to develop a method to allow for the creation of estate planning documents online, while validating the identity, competency, and volition of the signer.

AR: Estate planning needs to better reflect people’s social backgrounds. You hear a lot about identity politics these days. Our grammar and vocabulary are changing because people are demanding to be seen, heard, and reflected in our language. For example, I don’t know of many estate planners who, as part of the in-take process, ask their clients if they would like their religious beliefs reflected in their advance health care directive or if they would like to see their preferred pronouns reflected in their legal documents.

The views and opinions expressed in this article and the more fulsome responses from each expert are for information purposes only and do not constitute investment, legal, or tax advice. They are not intended as an offer to sell, or a solicitation to buy securities, services, or investment products. Views and opinions are current as of the date of publication and may be subject to change.