How to talk to my mom about estate planning

Recently, one of my friends emailed me the following:

Clark, can you help me. As you know my dad died several years ago. My mom is 80 and doing well but she is afraid to discuss estate planning. I know she has a simple will which leaves all to my brother and sister and me. Her house is worth about $800,000 (though she and my dad bought it for $16,000 way back when - not even a down payment today!) and she has some investment and savings accounts. I know she needs a revocable living trust so we won't have to go through probate, but I don't know how to broach the subject with her. Could you send me some basic information I can give her and my brother and sister to help them see the need for planning?

This is not the first time I've received this request. Below is a draft of a letter I sent my friend to give to his mom. I think it lays out the issues in a gentle and informative way.

Dear Mom:

Does Your Living Trust Protect Your Children from Divorce and Lawsuits?

Many of my new clients ask me to review their existing living trusts. Some are good, some are bad. Almost all of them do not protect the inheritance from lawsuits and divorce. Most estate planners  - assuming they are skilled and experienced - can help you avoid probate and estate taxes. That's where the work usually ends. We believe that is incomplete planning.

Why not draft the living trust to protect your children's inheritance from lawsuits and divorces?

If you go through the time and expense to design and implement your living trust plan, why not do it right and protect the inheritance? Most trusts I review are written to distribute the inheritance to the children at a certain age or in a staggered distribution - such as at age 25, 28 and 30.

We like to ask our clients why would you design your living trust so your children are given an inheritance that at a certain age is unprotected from lawsuits and divorce claims? The better approach is to design the living trust so each child's inheritance remains in a separate protected trust that at a certain age or benchmark event (a certain income level, graduation from college or grad school, age or ?) the child can take over as his own trustee. The assets, however, will remain protected in that child's trust.