The "ethical will" | Strategic Inheritance

The “ethical will”

I’ve touched on it before. I have no question I will be writing about it again. This, perhaps more than anything else, is what distinguishes legacy planning from estate planning: the content of what some call the “ethical will,” and others refer to as a person’s “testament” or “legacy letter” or what our second legacy planner called the “family wealth letter of intent.” It’s the device–or collection of devices: written, audio, video, or other–that conveys to members of future generations the special messages the estate plan donor wants them to know and remember, the stories of the people and events that shaped their lives, the special life lessons, the heart of the donor.

Kevin Simpson of The Denver Post wrote a wonderful article on the subject in late February. I’m sorry I haven’t blogged about it before now.

While most ethical wills carry no legal force, people have used their keyboards, or even video cameras, to transfer a wealth of experience and values from one generation to the next. . . .

Count John Angus Eifler, 83, among those who have created a portfolio of life’s invaluable intangibles.

He lost his wife six years ago to cancer after nearly a half-century of marriage. While attending a Boulder support group for people who had lost their spouse, he learned about ethical wills.

Eifler immediately sat down at his computer and began writing. He included poems he’d written, and when he found some his wife had composed, he included those too. Favorite recipes found a spot, as did photos and accounts of his trip to South Dakota.

At 76 pages and counting, Eifler’s ethical will assumed elements of a personal history as he hammered out anecdotes to be passed on to his three children — and anyone else who cares to read it.

But he also got philosophical.

“It can be quite surprising, this process of revealing yourself to yourself,” he says. “Sometimes the inner functions of your mind come out, and you think, ‘Did I really want this, or do this, or feel this way?’ When you write, you’ll bring some things out of your unconscious.” . . .

John Warnick, a partner at Denver law firm Holme, Roberts and Owen, was introduced to the ethical-will concept five years ago. Since then, he’s become a proponent of stating values in estate-planning documents for both personal and practical reasons.

For instance, he says, a grandchild wishes to use trust money to travel, knowing that his grandfather often talked of how seeing the world gave him a valuable real-life education and inspiration to amass his fortune.

Operating under legal boilerplate, a trust officer might reject that request because it’s not an educational expense at an accredited university. But an ethical will, carefully integrated, could clarify Grandpa’s intent.

“That is what’s sometimes missing in the pure transmission of property and wealth,” Warnick says. “We fail to connect the recipient with the enduring values of the person who possessed these objects.”

Warnick acknowledges that many lawyers still fear that the potentially squishy language of values and vision can run afoul of legal exactitude and invite lawsuits. Still, he sees some moving in this direction.

“It’s the most satisfying part of my job,” he says of his values-based work. “Most law firms’ signs say, ‘Attorneys and counselors at law.’ This is, in my view, at the heart of the counseling function.”