Nobel Prize winning economist Friedrich (FA) Hayek (1899 to 1992) once commented that it’s a shame that capitalism is so named. He noted that the tragedy of capitalism is that it was named by its enemies who hated it. “Capital – money,” Hayek said, “isn’t the central point of capitalism. Rather, capitalism is the never ending system of increased cooperation among strangers.”

This never ending system of cooperation is all around us. I’m always amazed by technology, so even something as simple as an Automatic Teller Machine (ATM) tends to engage my imagination. ATMs have been around a long time, as they became popular in the early 1980s, and their capabilities have been exponentially expanding ever since. When I was recently overseas, I needed some local currency and wanted to get the best exchange rate. The hotel clerk advised that the best rates are found at the ATM, and there happened to be one conveniently located around the block.

I found the ATM, inserted my bank debit card to withdraw about $200 worth of the local currency, punched a few buttons and out it came. Talk about a system of cooperation among strangers! Here I was in Europe, and within moments had local currency in hand, with an appropriate amount deducted from my checking account here in Florida at a favorable exchange rate!

So please allow me to relate Hayek’s definition of capitalism to your estate plan. Most people tend to limit their view of estate planning as handling the transfer of wealth upon their death. In other words, that pile of paper that you signed in my office is merely a means to transfer your hard earned capital to your spouse, children or other loved ones when your time on Earth is finished.

If instead you view your estate plan as the capitalistic endeavor that it truly is, you see it as a never ending system of increasing cooperation among your loved ones with strangers. It begins with the creation of your estate plan, which requires the work of your estate planning attorney. But he’s not the only one working on the creation of your documents. He has legal assistants, clerks, and a host of others (and even far off computer programmers) who are necessary to provide you this service.

Assuming that his system assists with the transfer of your assets to your trust, his team then interacts with your financial advisors, banks and trust companies to ensure that all of your assets are properly titled into your revocable trust and that the proper beneficiary designations have been named. To prove my point that your estate plan is something more than the transfer of capital wealth upon your death, if you should become disabled then you can see how more cooperation among strangers becomes beneficial.

A good estate plan will put into motion the installment of your successor trustee and perhaps your agent under a durable power of attorney document who will now interact with your financial institutions to write your checks, pay your bills and manage your assets. Your trustee may be a loved one or it may be a professional. In either event many others will be cooperating to ensure that your affairs are kept in proper order and that you are well taken care of.

I make the argument that a good estate plan is worth more to the client than it is to the client’s beneficiaries for this very reason. That’s why it’s so important to have the triumvirate of a good estate planning attorney, CPA and financial advisor because, at some point, we all decline and become vulnerable. Waiting until something tragic happens is asking for what I call a “transition in a time of crisis,” which nobody wants to have happen.

Too often clients rely simply on family members rather than developing relationships with “strangers” such as attorneys, CPAs, trust officers, bankers and financial advisors. When you engage these professionals for a mere transaction – drafting an estate plan for example rather than developing an ongoing relationship with you on a constant basis to keep your estate plan up to date – you are not using all of the true resources in our capitalistic society.

There’s an inherent problem with working with professionals on a strictly transactional basis while relying solely on family members. Your adult children and other loved ones lead busy lives and may reside hundreds, if not thousands of miles away. The better course of action is to transform strangers into confidants who will be there to support you and your family when they are most needed. This way, your team of professionals can cooperate and support you and your family.

Capitalism and the technology supporting it are only going to improve over the coming years and decades. Like a good capitalist, look at your estate plan in a different way – as a valuable tool to preserve and protect what you’ve worked so hard to earn over the course of a lifetime.

The Sheppard Law Firm has its main in Fort Myers and also in Naples by appointment.

© 2017 Craig R. Hersch. Originally published in the Sanibel Island Sun.