Editor’s note: From Curt Ferguson’s monthly estate planning column, Estate Plan Edge.

It’s raining today. Again. Many of my farming friends and clients are nervous. Is it going to stop raining long enough for them to finish planting? Clients further north are nervous because they aren’t getting enough rain. Everything is planted, but will they get the rain they need?

My father had great eternal perspective. He used to say he had more faith in the One who controls the weather than in the ones who control the markets. But he was human too, and felt the stress of rainy days, when we needed to be working the ground, or planting, or making hay.

“Make hay while the sun shines, because you never know when you might hit a stretch of estate planning rain,” says estate planning attorney Curt Ferguson.

Much of estate planning is about rainy days. Consider some examples.

Save for a rainy day. It was not easy to get where you are. You did it by prioritizing the needs of tomorrow above desires of today. During prosperous earning years, you disciplined your standard of living. The tax code encouraged you to buy equipment, but there’s only so much of that you could justify. So you built your estate and security for the future by investing in assets that can provide for you and your heirs when the rainy days come.

Rained out. You have been saving, working hard, getting the mortgages all paid off. You got the will or living trust prepared. Everything is in order to “win” this game of life. You are in a position to pass the beloved family farm to the next generation. Then, the whole game is rained out…by catastrophic health care expenses. The farm must be sold to pay your nursing home bill because you didn’t take the right steps to “rain proof” your estate.

Weather rules

“Times aren’t always good. We have to take advantage of opportunities when they exist, because they may pass by and never return,” says Curt Ferguson.

Money rains down on someone. Think of the news you hear about lottery winners. Very often, within a couple of years the two million dollars that rained down on their head is not only gone, but the winner is worse off than before: bankrupt, alcoholic, broken marriage…sometimes even worse. Could the estate you built have a similar effect on your heirs? You might recoil at the question, but don’t overlook this potential as you plan. Is each of your children prepared to be a good steward of what they stand to inherit? Do they understand how hard it is to create the estate? Will they appreciate all you did? Will they gratefully accept it as something to provide them security, or will it merely elevate their standard of living—temporarily—to an unsustainable level? “Well, I sure hope they will appreciate it more than that!” you say? A prudent estate plan will address this with more than hopes or wishes.

Storms will come. If I could tell my parents exactly how I want to receive my inheritance the choice is obvious. I want them to plan so that I would receive it in a beneficiary-controlled, asset protection trust. As I educate farm families about this concept, they overwhelmingly like it. Details vary from one family to another and from one beneficiary to another. The level of control given to some beneficiaries should be less (think of “Money rains down”) while other beneficiaries get very broad control. The asset protection planning can include dramatic tax benefits or no tax benefits. It’s not tax driven. The consistent theme is protecting the inherited assets from each beneficiary’s storms of life: divorce, lawsuits and catastrophic illness.

In the end

Times aren’t always good. We have to take advantage of opportunities when they exist, because they may pass by and never return. A carefully crafted estate plan can address all of the planning issues described above. Don’t focus too much on one and forget the others. Any number of things can make the opportunity disappear, such as your unexpected disability or death, or changes in the laws.

So what is my point? Make hay while the sun shines, because you never know when you might hit a stretch of estate planning rain.

Curt Ferguson owns The Estate Planning Center in Salem. Learn more at thefarmersestateplanningattorneys.com.