Estate planning is often a difficult time for loved ones, especially if something unexpected happens… In this episode of The Agent of Wealth Podcast, host Marc Bautis is joined by a special guest, Kat Newport, ACC, CCP. Newport is the author of Smart Conflict, Turning Disputes into Growth Opportunities and Founder of Oculus Coaching Inc. With a fervent commitment to using conflict as a catalyst for growth and innovation, Kat empowers individuals and organizations to thrive.
Tune in to learn how to proactively mitigate conflict through effective communication and planning!
In this episode, you will learn:
- The common sources of conflicts during the estate planning process.
- How mediation and conflict coaching can be used as tools to solve estate planning conflicts.
- Common misconceptions about estate planning.
- How to prevent estate challenges and facilitate a smooth transition.
- And more!
Resources:
Smart Conflict, Turning Disputes into Growth Opportunities | smartconflictbook.com | Kat Newport: LinkedIn | Bautis Financial: 8 Hillside Ave, Suite LL1 Montclair, New Jersey 07042 (862) 205-5000 | Schedule an Introductory Call
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Disclosure: The transcript below has been edited for clarity and content. It is not a direct transcription of the full episode, which can be listened to above.
Welcome back to The Agent of Wealth Podcast, this is your host Marc Bautis. Today, I’m joined by a special guest, Kat Newport.
Kat Newport, ACC, CCP, author of Smart Conflict, Turning Disputes into Growth Opportunities and Founder of Oculus Coaching Inc., is a dynamic force in conflict coaching and personal awareness. With a fervent commitment to using conflict as a catalyst for growth and innovation, Kat empowers individuals and organizations to thrive.
Through Oculus Inc., Kat provides a transformative journey, individually coaching leaders and shaping comprehensive programs that leave a lasting positive impact on individuals and organizations.
Kat, welcome to the show.
Thank you so much for having me, Marc.
Today, we’re going to discuss how to proactively mitigate conflict when estate planning. Kat, you came to me with this topic, which stems from the work you do with a client of yours, an Estate Planner. In that role, you’re the go-to partner when individuals and families bump up against conflicts surrounding planning or executing their estates. I’m excited to discuss your expertise, and experience, bringing some value to our listeners today.
First, let’s discuss sources of conflict. What are some of the common conflict areas you’ve been asked to assist with during the estate planning process?
Common Sources of Conflict During the Estate Planning Process
One of the most common sources of conflict is complex family dynamics. Nowadays, we see far less “nuclear families” – where it’s one spouse and a couple of kids. More often, there can be:
- Multiple spouses
- Blended families
- Extended families
- Informally adopted children, and so on.
All of these complex relationships intertwine with one another…
When a loved one has either passed away, or is planning their estate in preparation for the future, these relationships – which may have been informal or never discussed – all start to come into play. These individuals each may have their own assumptions, and those assumptions may not be shared. From this, comes friction.
In your experience, do you see these conflicts arise more often during the estate planning process, or after death?
I’m usually invited into the room when the conflagration has already begun. Someone with my skill set – mediators, conflict coaches, lawyers – most often get involved after the fact. But I’m a big believer in being proactive – having these open conversations in advance, managing these relationships, to avoid conflict after death.
Related: 5 Things You May Not Know About Estate Planning
How are you brought into these conversations? Is it by the family, the attorney probating the estate, or someone else?
It depends. The estate may bring me in if there’s a particularly sticky situation going – one that the executor is struggling with.
The executor themselves can bring me in. Executorship can be quite trying. You’re dealing with the legal, while adhering to the wishes of the loved one, while managing relationships through a period of transition and grief. As you can imagine, it’s very difficult, especially if the executor is grieving themselves.
So, there’s a few vectors in the situation.
How do you approach these conflicts when they arise?
How to Approach and Resolve Estate Planning Conflicts
There’s two main ways that I address conflict in the estate planning process…
Mediation
The first, through mediation. This is where two or more parties agree to voluntarily come into a room to discuss the sticking point. For example, it might be a piece of property, or who will take over the business after the loved one’s death. This is a voluntary process where both individuals or both groups come into the situation with an goal to move forward.
I facilitate this discussion, and we will explore all of the parties’ perspectives. We discuss what everybody wants the outcome to look like, how everybody’s comfortable moving forward, and we focus on the relationships. After all, we’re dealing with grief. So it’s definitely relationship-focused.
Conflict Coaching
If both parties are not ready to come to an agreement, we can move into what’s called conflict coaching. This is where I meet one-on-one with a party – be that a couple, family, splinter, or otherwise – and we talk about their specific perspectives. We talk about what they see happening, what they want to happen, what their drop dead points are.
We start unpacking some of those internal narratives surrounding conflict. We’ve been gathering narratives on conflict since we first drew breath – for good or for ill. Once we unpack those kinds of things, we make progress towards having those conversations, eventually. The goal here is to have a shift in mindset.
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That makes a lot of sense. There really are a lot of moving dynamics. In your experience, do these conflicts erupt due to holes in the estate plan, or because even though the estate plan was defined, family members are still creating conflict?
Where Estate Planning Conflicts Stem From
There are many reasons why estate planning conflicts come about, both of those included.
If the relationship with the loved one who’s passed on was rocky to start with, or the communication wasn’t present before the loved one passed on, there can be a lot of gray areas. It may look something like this:
“Grandma promised me the China.”
“No, no, no. Grandma promised me the China.”
We also need to consider everyone’s relationship with the deceased loved one. Whatever the state of that relationship was at the time of their passing is what we have to work with and work through. So, if there were unresolved conflicts with the loved one, or if issues weren’t addressed before their passing, leaving you feeling uncomfortable moving forward, you now have to confront those issues. When you add in family dynamics, financial matters, and heightened emotions, conflicts can arise.
There are numerous dynamics at play here. For instance, a second spouse may be at odds with a first spouse, or there might be tensions between the new partner, who hasn’t been officially married yet, and the ex-partner. These relationships bring with them expectations and entitlements — like feeling deserving of something from the deceased individual.
For example, someone might argue, “I took care of Mom for the last five years of her life, while you did nothing.” Various factors come into play, including how the loved one passed away. If it was a prolonged illness, there may have been opportunities to reconcile and prepare emotionally. However, if it was a sudden death or accident, you’re left with the last state of the relationship with no chance for closure. This creates a challenging point where you need to resolve issues both internally and within the family while navigating the lengthy estate management process, which can take 18 to 24 months. As a result, the situation can become very complex.
Got it. I’m sure no one listening right now is thinking, ‘When I pass away, I want there to be a conflict.’ So, what proactive steps can individuals and families take to prevent these conflicts from arising?
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How to Prevent Estate Planning Conflicts From Arising
1. Communicate
The first word that comes to my mind is “communication.” I urge you to engage with your family openly. Share what you desire, explain your reasoning behind it, and convey why it’s significant to you to proceed in this manner.
2. Be Positive
Secondly, when it comes to communication, strive to maintain a positive tone. Avoid using it as a weapon for coercion or punishment, like saying, “I won’t include you in my will because you upset me today.” That’s not the kind of communication I advocate. It shouldn’t be wielded like a blunt instrument to force compliance or bend others to your will. In addition to effective communication, it’s crucial to consider changes within the family dynamic. If it’s been some time since you last updated your will, take into account any new additions to the family such as births, deaths, or marriages. These events can significantly impact how you envision the management of your estate going forward. Therefore, ensure that your will reflects your current wishes by keeping it up to date.
3. Update Estate Planning Documents
Lastly, another crucial aspect to consider is having a living will or healthcare directive in place. It’s vital to plan for situations where you may become incapacitated and unable to make decisions for yourself. As you near the end of your life, ensuring that these directives are communicated well in advance to trusted individuals such as your siblings, spouse, and children is essential. This ensures that everyone is aligned and aware of your wishes, which can greatly minimize conflicts when decisions need to be made on your behalf.
Related: 4 Estate Planning Tips
When conflicts arise after death, how do you handle situations where the will contradicts the prevailing conflicts? Do you strictly follow the will, or is negotiation and mediation considered? And are there circumstances where you might go against the provisions of the will or other legal documents?
How Negotiation Works as a Mediator
As a mediator, I refrain from giving advice, leaving decisions entirely up to the parties involved. My role involves bringing both parties together in a room where each can respectfully express their thoughts, feelings, and desires, adhering to ground rules. The mediation process is built on empathy, aiming for mutual understanding that often eludes us. It fosters active listening, which can be challenging, especially amidst heightened emotions. It ensures both sides have an equal opportunity to voice their concerns.
One significant aspect is clarifying the root of the conflict. Many enter disputes without fully understanding their underlying issues. For instance, someone may appear to argue over an heirloom when, in reality, they seek acknowledgment and validation. By uncovering these deeper motivations, we can then explore constructive paths forward. For example, if the dispute over the heirloom is resolved, we can focus on how to foster a sense of recognition and belonging for all involved, perhaps by offering alternative ways to honor their relationship with the deceased.
What makes a mediation “successful?”
What Qualifies as a “Successful” Mediation?
As the mediation progresses, there’s a noticeable emotional arc. Initially, everyone appears composed, but emotions gradually escalate as each person shares their reality. Eventually, we reach a turning point where all parties have had their say, and we shift towards finding solutions. This involves both sides collaboratively drafting agreements that everyone feels comfortable with. Throughout the process, I find visual aids like flip charts helpful for clarity. We work through options together, such as assigning the heirloom to one cousin while giving another the opportunity to contribute in a different way, like delivering a eulogy. The goal is to create a written agreement that all parties voluntarily accept. Admittedly, not every mediation achieves resolution, but ultimately, it’s the parties involved who decide. My role is to facilitate dialogue, create a supportive environment, and ensure each perspective is understood.
Are there any “red flags” families should watch out for during the estate planning process that might indicate potential conflicts in the future? In the same way that you have a list on the mediation side, do you have one for the planning side?
I don’t rely on a specific checklist, but I have a sort of mental checklist. Firstly, ensure you have an inventory of assets. Secondly, have these assets assessed beforehand. Whether it’s art collections or properties, getting them evaluated in advance can streamline the estate management process after the loved one’s passing. This proactive approach eliminates the need to wait for real estate agents or assessors, expediting matters significantly.
And how granular do you go in terms of assessing things, right? Obviously there’s big things like a house and maybe jewelry or stuff like that, but do you go all the way down to everything that they own?
I wouldn’t go that far. The ring you’ve been wearing sterling silver that you bought for five bucks but has more sentimental value. You’re not going to get an appraiser in for that kind of thing. So this then comes into, well, Sally, do you want that? Or Henrietta, do you want that? So we’re back into that communication piece as well. The big ticket items are the ones you want those assessors to come in on, and the high emotional pieces are the ones you want to have those conversations with about either directly one-on-one, if your relationship is good enough potentially with a therapist if you need to go that direction, or a mediator, which are two different things, or a mediator if you need someone to facilitate that conversation.
Related: 6 Must-Have Estate Planning Elements
What if someone is hesitant to think about planning for the future, avoiding discussions about passing away? How can we encourage them to address these important matters? Should it be the children, or perhaps an advisor they trust? Who should take the lead in gently guiding them through estate planning?
Approaching the Topic of Estate Planning With Loved Ones
From a coaching perspective, reluctance to face these issues often stems from deep emotions. It’s crucial to empathize and understand their fears, anxieties, and even anger. Supporting them through this process involves exploring their concerns and fears, rather than simply insisting they address their will. Instead, ask how you can help and understand their worries.
For those who haven’t planned their estate yet, it’s important to emphasize that estate planning is an act of love. It ensures that your family won’t have to worry during their time of grieving. Acting from a place of love rather than fear or anger can shift the conversation. Reassure your loved ones that you’re taking care of these matters out of love, making their journey through loss a bit easier.
Related: How Using a Professional Executor Can Improve Your Estate Planning
Yeah, that makes sense. Alright, Kat, that’s all of the questions I have for you today. Thank you for joining me for an episode of The Agent of Wealth, it was great hearing from you on this topic. Not only have our listeners gotten a lot out of it, but so have I. I can use much of this advice with my clients as they embark on the estate planning process. Thank you. Before we go, how best can our listeners learn more about you, and what you do?
The best way to get a hold of me is through my website, smartconflictbook.com. There, you’ll also find all of my articles.
Great, we’ll link to those in the resources section of the show notes. Thanks again, Kat. And thank you to everyone who tuned into today’s episode. Don’t forget to follow The Agent of Wealth on the platform you listen from and leave us a review of the show. We are currently accepting new clients, if you’d like to schedule a 1-on-1 consultation with our advisors, please do so below.