Your Lawyers 4 Life...™ Blog
I thought folks would be up for a change of pace. Here is what Steven Colbert thinks about the estate tax repeal. Pick it up at the second segment at minute 12:00. Enjoy.
Folks in the Princeton area are probably familiar with the US 1 newspaper that is handed out free to area businesses. It’s a good paper that offers a lot of insightful articles on business-related issues and items of interest in the Princeton area.
Usually, the newspaper includes an editorial, and a few months ago, one of the editors submitted a column about how difficult and frustrating it was to wind up the affairs of his mother’s estate. The thrust of his story was that he never got a chance to begin to grieve the loss of his mother, as she quickly became a set of papers and projects to be completed.
I completely sympathize with his position. As an attorney that helps families go through transitions, it’s all too familiar a situation that the person gets lost behind the process. That happens, too, by the way, when we help older folks transition from life on their own to an assisted living facility and then a nursing home.
One of the things that we focus on, especially when we get a chance to do proactive estate planning, is the transfer of wealth of the non-financial assets. The goal that we share with our clients is to make the transition as seamless as possible while at the same time allowing the client to maintain control and flexibility over their assets during their lifetime.
Ours is an atypical approach to estate planning, to be sure, but we find that this philosophy and approach resonate with almost every client and planning partner we encounter.
Also in this article was a suggestion by the writer that the use of living trusts was overrated in New Jersey because of the ease of the probate process. While I disagree with the notion that living trusts are overrated, I agree that the acceptance of a will into probate process in New Jersey is relatively painless. The Surrogate’s office makes the process of submitting a will and having Letters of Administration issued a fairly smooth one. (Especially when you have a qualified attorney to help you along the way.)
However, I was more than a little amused by the rest of the editor’s column, in which he begins to lament the obstacles and struggles that occur in the actual administration of the estate. I say amused only because most of his difficulties would have been greatly reduced by the existence of, you guessed it, a living trust.
Here is the link to the article where the editor gratefully published my response.
Posted by Victor Medina
Amber Watson-Tardiff, who posts a regular column on NJ.com about Parenting Advice for New Jersey parents asked me to comment for an article she was writing about the fallout from Balloon Boy, including anticipating court intervention with the parents.
You can read the whole article here – and I’ve pasted most of the column below (and bolded my portion for my mom’s easy reading):
It was just a week ago that the nation was captivated and horrified by the runaway weather balloon that supposedly carried away six-year-old Falcon Heene–or so we thought. But the Heenes could now be, charged with staging an elaborate hoax.
While most people seem to be focused on the criminal charges the Heenes may face, what damage was inflicted on their children? And does the state of Colorado have grounds to intervene?
Clearly the incident had a detrimental effect on balloon boy himself, as the world watched him vomit on live TV during an interview with Meredith Viera.
Today we hear accusations from a former co-worker of Mayumi Heene claiming that Richard Heene is unbalanced and worrying that a Jonestown incident could ensue if his wife and children are not taken out of the home immediately and placed in protective care (apparently Richard was trying to earn enough money from a reality show so they could build a bunker and hide from the sun exploding in 2012).
And while I hate to see any child taken out their home and placed into the hands of strangers, there may be legitimate cause for concern.
In fact, it may already be too late to avoid state involvement according to Victor Medina, managing partner of Medina, Martinez & Castroll, a Pennington, NJ law firm focused on counseling families in crisis.
According to Medina, the state agency charged with child welfare has a responsibility to make sure the Heene kids are safe.
“If this was truly a hoax, you can bet the parents will have to explain why they thought it was a good idea to involve their kids in this stunt. If it wasn’t a hoax, then Richard and Mayumi Heene will still have to say why they permitted such a potentially dangerous situation to unfold. Either way, the Heenes can expect to answer for their actions as parents,” he said.
But state intervention isn’t always the answer, Medina contends. “By all accounts, this was a loving, if misguided, family. Sometimes the court system can get over-involved in the lives of a family and create more of a mess down the road. As in all things, reactions have to be carefully measured so that the best interests of the children, both balloon boy and his siblings, are served,” he says.
So what, if anything, can the Heenes do at this point to ensure their kids don’t wind up in the care of strangers if they are incarcerated or deemed unfit as parents by the state?
According to Georgia Family Law attorney, Steve Worrell, it’s not too late to make custody arraignments should both parents get slapped with jail time.
Worrell says, “The Heenes can name guardians now for their kids in the event the state deems it necessary to intervene. Then if they are found to be unfit, their choice of guardians will likely be honored by a court unless the selected parties are also found to be unfit.”
Only time will tell what’s going to happen with these poor children, but I’d like to know what you think? Should the state intervene to protect the welfare of these kids? Or is this just a case of poor judgment from otherwise loving parents that can be easily fixed with counseling?
Article written by Amber Watson-Tardiff and featured at NJ.com Parenting Guidance Section posted here on October 22, 2009.
Most people think of “doing estate planning” as the act of creating and signing a will. While in some cases, a will is the best instrument, you can’t get to that answer without engaging in a comprehensive process where the lawyer gets to learn about you and your family, your goals and desires, your values and expectations. Only then can an effective estate planning attorney recommend the best document or set of documents to create an estate plan that “works” for you.
While it is a near certainty that some day you will die (notice how a good attorney never lets himself get painted into a corner), the truth is that you will more likely experience a long-term disability than a catastrophic death. If all you have is a will, you’ve done nothing to plan for that disability. A comprehensive approach will include planning for your disability as well as your passing.
In the end, estate planning should be about giving you the control and flexibility to live your life with peace of mind, knowing that there are safeguards in place that will help you provide for your loved ones if you are disabled. An effective estate plan will let you give what you want, to whom you want, when you want them to have it, and in the way you want them to have it. All the while providing a way to allow you to pass along your wisdom with you wealth.
Posted by Victor Medina
Medina, Martinez & Castroll, LLC
In my first post, I talked a little about those attorneys who offer to do it all for you (real estate, commercial litigation, business representation), including your estate planning. Just as not all estate planning attorneys are the same, Myth #2 is that not all estate plans are the same.
Despite what Suze Orman will tell you (and sell you), you should not get your estate plan out of a box. If the attorney (or financial professional) you’re interviewing is bragging about how easy it is create a will or a trust, you should run, not walk, in the other direction. The term “boilerplate” as it pertains to your entire document, should not be a source of comfort, but a source of concern.
The truth is that not all estate plans are, or should be, the same. While the word processing elements of an estate planning document is not altogether difficult (did you know that attorneys own computers?), a will or a trust is not something that should be created by the attorney without input from you.
A good estate planning attorney will want to spend time with you to figure out your hopes, your dreams and goals. Once you teach us the family, we will help you learn the law, and together we will create an estate plan that works.
Posted by Victor Medina
Medina, Martinez & Castroll, LLC
The websites of general practice lawyers, as well as those of large, mega law firms, almost always include “Wills & Trusts” or “Wills & Estates” as practice areas. If you went by the sheer number of lawyers with this listing, you would probably conclude two things: First, almost everyone in a community has, or is looking for, an estate plan. Second, estate planning is something that does not require a lawyer who dedicates his practice just to that area. Of course, you’d be wrong on both accounts.
Contributing to this problem are two conclusions driven by changes in society. One, folks have discounted the value of counseling and advice from a professional. Out of a sense of ego or skepticism of people trying to “sell” them something, people have started replace the advice and counsel of a professional with knowledge gained by their own research, usually on the Internet.
Second, people now view professional services as the commodity of what is produced at the end of the service. If it has to do with life insurance, people focus on the price of the premium, without understanding the intricacies of the policies themselves and without understanding the quality of the underwriting. In the estate planning world, the focus is on the “it” of the documents – whatever “it” turns out to be for that client – a will, a trust, a living will, a power of attorney.
The unenlightened have already concluded from their own research what they need and they call around shopping that commodity on price.
While I take a long time to settle on a professional to help me in different areas (usually I trust my gut), once I chose that person, I rely on their expertise in helping me with my problems. The cost of the service is only relevant to whether the advice and service does what it’s supposed to do.
The truth is that to maximize the chance that your estate plan works when you need it to – you need an attorney who makes doing this work the focus of their practice. Your estate plan is no different than dealing with a medical condition – in most cases, you need a specialist who has seen your situation lots of other times and can apply their additional expertise and knowledge to help your specific problem. When it becomes appropriate, you begin to interview and select a cardiologist to treat you. Not only that, but you might go with the cardiologist who specializes in diabetes – adult onset diabetes.
Not all estate planning professionals are the same – you deserve the specialist.
Posted by Victor Medina
Medina, Martinez & Castroll, LLC
*By the way, if you’re one of the ones shopping on price, let me save you a phone call to my office. I’ll give you here the same response I give anyone who calls asking what the price for “it” (the will, the trust, etc.) is: It’s FREE. All of my wills are FREE. The trust is FREE and so is the living will. Never have and never will.
On the other hand, I charge for the counseling. Whether I’m worth my fee for that counseling is up to you to decide and I invite you make a free, no-obligation appointment to learn more. Reference this blog post and I will waive my normal $750 evaluation fee.*
President Barack Obama has been making the rounds across the country to promote his health care initiatives.
One of the places where President Obama showed up was an online forum sponsored by the AARP. In his response to a question about a proposed health care bill, President Obama said that he and First Lady Michelle Obama each have living wills (but hoped it would be a long time before either one has to put them to use).
Like any diligent parent, the President and First Lady have thought about what might happen in the future and have taken steps to make sure that their decisions and directives will be followed in case the unthinkable happened.
I would add that, as parents of young children, everyone should have a kids protection plan in place to take care of their children if something happened to them.
Finally, I’m giving away FREE living wills for the month of August. I chose to do this because of the work I had to on behalf of a local fireman who was injured on the job. I was shocked how 3 attorneys needed to get involved just so decisions could be made. I want to help fix that problem. So, make an appointment in August for a Family Wealth Planning Session (free, valued at $750) and receive a FREE living will and advance health care directive for you and a spouse.
Posted by Victor J. Medina
Medina, Martinez & Castroll, LLC
Recently, I posted about the need to pass on your “on line” information as part of a comprehensive estate plan. My article examined the various companies that offered to guard that information for you. It seems like the Wall Street Journal reads my blog because they just published an article of their own on Sunday regarding the same topic. I’m not angry, just happy that they’re giving the topic or wider audience than I can provide.
In all seriousness, people are slowly coming to grips with how different this world is than one just 10 years ago. One of the professional associations to which I belong spent a few days debating back and forth the merits of planning for this type of “wealth” transfer in estate planning. I’m not sure there was a consensus, but I remain committed to helping him my clients with this problem by saving that information for them. From my perspective, estate planning is about transferring ALL of your wealth, not just your finances – such as your Spiritual, Emotional and Intellectual assets that you’ve acquired over your lifetime. For many people, information that is on the Internet, passwords, etc. is also included in that list.
It is often forgotten how much of a confidant attorneys were for their clients in the past. It’s our job to keep secrets, our client’s secrets, and the best of us do that very well. It stands to reason then that attorneys should be a natural repository for the type of secure information that needs to remain secure during a client’s lifetime and be transferred safely to the next generation when necessary. We need to get back to the idea that your lawyer is your counselor, not just during crisis moments, but during your lifetime.
My biggest problem with these companies and the services that they offer is that none of them has any professional license on the line if they mess up. There are also no barriers to entry to do this work. (Whereas an attorney needs a degree (most of the time), pass a bar exam, and has their license subject to review and revocation if they screw up.) Therefore, for these businesses, there is no incentive (beyond a business incentive) to act correctly in a situation. As we have seen in the past, online information is less than secure and there is no guarantee that even the best companies won’t have information taken from them, or be somewhat “negligent” in securing that information in-house. It has happened to the largest credit card companies; why should we think that small startups claiming to be able to hold your information secret should be any different?
What I liked about the Wall Street Journal article was the way it highlighted how being in the 21st century means that there may be assets which have no physical presence in the world. Follow me on this one for a moment, nowadays people are very accustomed to doing their banking online, creating an investment account online, and choosing to go paperless when it comes to statements. It is very easy to imagine a rather significant investment account that no one knows about or can discover after the person dies.
Just to show that I don’t hold grudges, here is the link to the Wall Street Journal article-http://is.gd/1FHFY
Posted by Victor Medina,
Medina, Martinez & Castroll, LLC
We’ve become all too used to folks in media twisting a story to suit a certain purpose. When Michael Jackson’s will was revealed, the media was reporting that he left everything to his Family Trust and then speculating as to what that meant.
Of course, no one doing the reporting is an estate planning attorney, so they didn’t mention the likelihood that there were likely ZERO assets owned in his individual name. The Family Trust referenced in his Will was likely created before he died and, if he did the right thing, his assets were funded into that trust. (The Family Trust was probably a living trust. Living trusts are like buckets. Funding is the process of taking your assets and putting them in the bucket.).
Instead of tearing apart the Will, dissecting the provisions of the guardianship nomination, I want to spend a few paragraphs discussing all of the right moves that Michael Jackson made in planning his estate. (I’m more of a “glass-half-full” kinda guy.)
First, he created a living trust and funded his assets into the trust. Back in the days where you could eat 6 days a week on a lawyer’s dime listening to a living trust seminar (the same rubber chicken meal, for sure), people were flocking to lawyers to have these magic books created.
What happened then, and what still happens often in estate planning, is that the lawyers left the job of funding the trust to clients, without any guidance (or at least, guidance that wasn’t billed hourly) from the lawyer. Personally, I think that’s a terrible way to practice and so we’re very diligent about making sure that our client’s trusts are funded.
If you visit a traditional estate planning attorney, clients are sent home with a nice, leather-bound book and a letter saying, “Now go move your assets into the trust.” This is hardly the best way to serve a client. Regardless, I’m hoping that Michael went with a great estate planning attorney that made sure that the assets were funded into the Family Trust.
We’ll soon learn whether the trust was fully funded because if Michael Jackson owned any assets in his individual name, they’ll have to go through probate to be put into the Family Trust – and we’ll see just how good his estate planning was.
Second, as a parent of young children, Michael likely separated the responsibility of caring for the kids from the caring of the money. (Again, we don’t know for sure because the Family Trust is a private document.) When I counsel clients with minor kids, I tell them that the only way to make sure that they money they leave for their children (through term life insurance or otherwise) is to keep the guardian’s hands off the spigot. That means having one person serve as guardian and a totally different person serve as trustee of the Trust created for the kids’ benefit.
As you can see, if you have the same person serving both roles, there is chance that the funds will be depleted before the kids are done being raised. Just as important, you will have lost control over the assets that you left for your children’s benefit. This issue is not so much about trust, but about control and taking every step that the assets you took time to plan to leave for your loved ones are there when they need them.
While we don’t know exactly who is named as a trustee, Michael likely kept those roles separate and therefore made it much more likely that the money will be used correctly for his children’s benefit and will last throughout their lifetime.
Third, his Family Trust afforded him the opportunity to keep his affairs private. We already know how fiercely private Michael Jackson was. If he died early, there would like be a frenzy of publicity digging into his life, his finances, etc. By creating a living trust, he’s been able to minimize the effect of his death as to access of his affairs. And you can see the fruits of this in the way that no one has been able to report what is in the Trust, who the trustees are, and who gets what, etc.
Now, it may be that one day the document is leaked, but the difference is that the Will was required to be filed as a public document, whereas the Trust is a completely private document. Unless you are a mega celebrity, the people that you trust with your assets (like your lawyer and your trustees) will be able to keep that secret and your affairs private. Even when predators come in to see if they can get some of those hard-earned financial assets that you left for your children.
Finally, Michael planned before it was too late. It’s unfortunate that it takes a tragedy for us to act – and it’s even worse that people will say “I need to so something” now and forget about it in a few weeks.
Unfortunately, tragedy knows no economy. The time is now for you to plan. As an estate planning attorney, father and husband, I’m thrilled to see that Michael Jackson did some good planning before he died.
I’m hosting a workshop on July 12th at 4pm at The Little Gym-West Windsor. If you are thinking about taking action and planning your estate, you owe it to yourself to attend. Here is the link for more information – Kids Protection Planning Workshop
Posted by Victor J. Medina
Personal Family Lawyer
My friend, and fellow Personal Family Lawyer, Candice Aiston has posted a great article regarding the guardianship issues raised by Michael Jackson’s early death.
Here are the first two paragraphs and I urge you to visit her site and read the rest. Well-written and very informative:
Like many people my age, I am a HUGE fan of “early” Michael Jackson. Loved him pre-surgery, during the disco and Thriller eras. It was sad to watch such a talented individual become a self-hating recluse. It was sad to see him on trial for sexual molestation of a young boy, and I can only hope that he didn’t really do it. He was acquitted, in any event. It kind of made me sad to see how oddly it seemed he was behaving with regard to his kids – contracts with the birth mother, veiled faces, a baby dangled over a balcony…remember the weirdness?
Now everyone is talking about how much money he left behind and how complicated his estate will be, what with all of his credit and debt issues and split ownership of certain rights to music. There’s a lot of talk about how it could take years to settle his estate. I guess that mostly depends on the type of estate planning he’s done, and we’ll find out all about it soon enough.
But what about the kids?