The Laws of your Money with Ann-Margaret Episode 1

Episode Transcript

Speaker 1 (00:00):
The following program is sponsored by New York Priority Medical Care.
Now it's time for the Laws of Your Money, a
weekly call in show with legal tips to help you
protect your money. Here's your host and Margaret Carosa.

Speaker 2 (00:18):
Hello and welcome to the Laws of your Money. This
is a show dedicated to protecting you from legal and
financial mayhem when it comes to personal finance. I think
there's nothing more important than protecting yourself legally, because what

(00:39):
does it matter how diligently I save and invest if
there's a greater than forty percent chance of losing assets
to a long term illness and expensive breakup taxes or
ordinary lawsuits.

Speaker 3 (00:57):
I believe we.

Speaker 2 (00:58):
All have legal lands in our lives. Are you concerned
about an elderly relative losing a home to a nursing home.
Are you in a second marriage thinking about the possibility
of blended family warfare? Later on, do we have a
special needs child or someone in our lives Paul who

(01:21):
spends money like a drunken sailor. Or are you estranged
from a family member and we're looking to avoid a
will war? Later on, I am asset protection attorney and
Margaret Carosa joined today again by my good friend, Paul
slatkis welcome back to the program.

Speaker 3 (01:42):
Paul.

Speaker 4 (01:43):
Thanks Sam.

Speaker 2 (01:43):
It is Paul's job to throw something at me if
I get into a legal ease, which I try not
to do. Okay, these issues literally affect everyone. I yet
to meet a person without these issues.

Speaker 3 (02:00):
In their lives. So our discussion last.

Speaker 2 (02:06):
Time was about the importance of a trust to protect
real estate. And before we go into a little recap
of that, I want to invite listeners to join our discussion.
The call in number at seven ten WOR is one

(02:26):
eight hundred three to one zero seven ten. So last
time we talked about a trust for the house. Do
you know that sixty five percent of people own their
own homes, whether that is a traditional house, a condo,

(02:49):
a co op, and we want to protect the real
estate from from several things, from ordinary liability. I think
you know we are living in a very litigious society.
You know, the theories of legal liability are are really baffling.

(03:13):
Last time, I shared the story about the guy who
swam with the killer sharks and SeaWorld and big surprise,
he died and then the family sued SeaWorld for wrongful death.

Speaker 3 (03:30):
I shared the story with you, Paul.

Speaker 2 (03:32):
A couple of weeks ago about the guy who begged
his office colleagues not to throw him a birthday party
in the office. You know, those miserable little affairs with
the stale supermarket cake and people, you know, during the

(03:53):
middle of the day, without the benefit of a few cocktails,
having to sing Happy Birthday to the per So this
guy was so adamant about not wanting this party, and of.

Speaker 3 (04:05):
Course, what did his colleagues do.

Speaker 4 (04:07):
Threw them the party.

Speaker 3 (04:08):
Hey, threw him the party.

Speaker 2 (04:09):
Okay, So instead of just suffering through it like we
all do at these miserable little office birthday parties, he
nearly had a panic attack because it turned out he
didn't like people paying attention to him.

Speaker 3 (04:24):
You know, he was a great worker.

Speaker 2 (04:27):
He liked to just be in the background, and this
little birthday party really pushed him over the edge. So
he spent the rest of the workday in his car
in the parking lot. And now his colleague started, you know,
snickering a little bit at him. And this was the
beginning of the end. He ended up parting company with

(04:50):
his employer, and he sued the company and he won
four hundred and fifty thousand dollars. Okay, So this is
what we want to protect ourselves from. And I think
real estate is the easiest thing for us to protect,
whether it's an LLP, an LLC andes corporation.

Speaker 3 (05:15):
My go to structure is a trust.

Speaker 2 (05:19):
And when I work with people on trusts and real estate,
I'm often asked questions about getting into investment real estate.
So I think it's critically important when someone asks me
how do I get into real estate? I want to

(05:41):
be a real estate investor. I would say Number one
is you need to save up a little money. You
need a little investment capital, and for most of us,
that means stop buying ridiculous stuff right and start saving
up money. And when you have a little capital to invest,

(06:04):
what's the next thing that we should do?

Speaker 3 (06:06):
What do you think we need?

Speaker 4 (06:07):
Research what you're doing.

Speaker 2 (06:09):
Do some research and enlist the help of experts. And
I hope that I would be considered a resource when
we talk about how to protect this new investment from liabilities.
But we want a real estate attorney in the mix,

(06:31):
we want a real estate broker in the mix, and
we've invited onto the program an expert in both of
those areas. He is a thirty year plus real estate
transaction expert who is also a real estate broker, and

(06:57):
he is super familiar with the real estate landscape. He
is a wealth of information and I am thrilled to
welcome to the program my colleague, someone that I trust
to refer clients to. Lewis Riggio. Lewis, welcome to the program.

(07:18):
Thanks so much for being with us.

Speaker 5 (07:21):
Thank you man, Margaret. That was such a nice insu
you appreciate it.

Speaker 3 (07:25):
No, it is totally true, you know.

Speaker 2 (07:28):
Listen, I happen to know I would say more about
real estate than the average person. I do a little
investment real estate in my own life, but it would
never cross my mind to get involved with transactions before
consulting someone like you, So I make sure that I

(07:52):
am totally protected. So I'm going to, if it's okay
with you, Lewis, pose a couple of questions that I'm
hearing a lot lately from my clients, from friends, from
family members.

Speaker 3 (08:07):
Does that work?

Speaker 5 (08:08):
Sure?

Speaker 3 (08:09):
Okay?

Speaker 5 (08:09):
Absolutely? Ready?

Speaker 3 (08:11):
All right?

Speaker 2 (08:11):
So what do you tell people who are kind of
sitting on the sidelines. They they want to buy something,
but they don't know what's going on with investment with
interest rates.

Speaker 3 (08:25):
Rather, what is the FED.

Speaker 2 (08:27):
Going to do? When is the optimal time to jump in?
What's going on with commercial real estate?

Speaker 3 (08:34):
Now?

Speaker 2 (08:35):
You know, what do you tell your clients who are
sitting on the sidelines waiting to jump in?

Speaker 5 (08:43):
Right? Well, first, you know, look, we can all make
an educated guest about all of these variables, right, but
no one has a crystal wall, and that's the That's
the important thing to remember. Predicting such things is very difficult.
My recommendation, and I think would be, for example, people
who are waiting for more Mortgan's rates to drop, I

(09:06):
think it would be better to find a home or
an apartment that fits exactly what you're looking for and
move ahead with that transaction, rather than waiting for all
of these variables to fit your exact situation. I think
you know, people who wait for the rates to drop,

(09:26):
they often wind up in either some kind of bidding
war over that have an unnaturally inflated price because of
this this new demand because of the rates dropped. So
my recommendation and those kinds of situations, look, now, find

(09:47):
the home or apartment that's that's right for you, make
the transaction. You can always refinance at a lower rate
down the road, and I think, great, guys, that's probably
a better of folks.

Speaker 2 (10:01):
Absolutely, that makes a ton of sense. So I would
imagine that in your work as a broker you sometimes
have to be a little bit of a diplomat. And
what I mean by that, I'm thinking of all of
the folks, myself included. I love these cable shows, you know,
the DIY and they can really make magic happen in

(10:26):
what looks like the span of a half hour. And
people are really biting off do it yourself projects before
putting a home on the market. And you know, I'm thinking,
for example, about something like a hot tub that maybe

(10:47):
fifteen years ago that was going to help your sale price,
but these days, I think people look at a hot
tub and it's just this ick factor.

Speaker 3 (10:58):
Right.

Speaker 2 (10:58):
I don't want to go into a high where you know,
the last people who owned the house were spending a
lot of time in without their clothes, just totally gross.
You know, are there any DIY projects that you think
people can do on their own and are there some

(11:19):
things that you would just tell them, you know, leave
it to a professional.

Speaker 5 (11:24):
Right, So this is a little bit of a tricky
question because the d YI projects are are very personal,
so I think you'd want a professional in looking at
the space, taking a look, giving advice on what may
or may not add value, because a lot of times

(11:46):
what happens is people do this before and listening a boker.
They do something that they think is going to enhance
the value of the property, but in retrospect it might
not be so appealing to a new buyer or buyers
that are coming into looks. So I think a better
way to approach it might be to have a broker
come in discuss the project ahead of time, get an

(12:07):
independent opinion on that, because the worst case scenario is
you go ahead with a doing yourself project and really
you're not adding any value to the property and you've
just lost whatever All of the time, effort and expense
you input into that is pretty much out the window.

Speaker 2 (12:27):
And that's something that you would be able to do
for someone correct.

Speaker 5 (12:34):
I joined the team at Cork at the Courtroom Group.
It's the Lawrence Shire team. These people are experts, they're
they're the number one team in the office that that
we joined. The professional their farm and more important, they're
very experienced. They have have many answers to these questions,

(12:55):
they give good advice and again that that knowledge is
based on years and years of experience and in real time.

Speaker 3 (13:04):
Yeah.

Speaker 2 (13:04):
So, I mean, let's say I'm interested in selling, you know,
my triplex co op in Midtown, and I invite you
in to kind of walk through it and give me
your opinion as to what the listing price should be.
What do you say to me, Lewis, If you enter

(13:27):
the apartment and there is like char Truth's green shag
carpeting and stucco ceilings, you know, which was the cat's
meow in nineteen seventy four, what do you tell me?
Do you say, let's get someone in?

Speaker 3 (13:44):
What do you say?

Speaker 5 (13:46):
Yeah, I say, these things are very personal, Okay, And
by the way, being a broper, you know, it's so
much more than just like opening doors and walking people
through space. Well it should be right, right exactly, and
for a stellar you know, it can be a very stressful,

(14:08):
emotional roller coaster. Look, let's face it, these things that
you just mentioned, they might be very personal to the
to these people. So to your point, you have to
be careful how you address this. I think that as
a broker, it's part of your job too, you know,
give current opinions on what you think may or may

(14:29):
not be appealing to others. We have companies that pay
the photograph market discuss price, it's it's it's a service
that's again based in experience. It's current. We know what
what the current fire market wants and say it in

(14:54):
a way that may not be offensive to the person
with the shad.

Speaker 3 (14:57):
Carpet right right.

Speaker 2 (14:58):
Listen, you know you you have the connections, you have
the professional resources, the contact so it's a little bit
of a one stop shopping when folks are working with you.

Speaker 5 (15:12):
How that's exactly right?

Speaker 2 (15:14):
Yeah, not cousin Fred. You want to call Lewis Raggio.
Where can they reach you Lewis.

Speaker 5 (15:21):
So they can reach me at Lewis dot Raggio at
the Corcorandgroup dot com. That would be the best way
to contact me by email. Our team is ready to work.
You will get a prompt response in every scenario and

(15:41):
that's the best way to do it.

Speaker 2 (15:42):
Awesome, Lewis, thank you so much for your time today,
and I hope that you will come back on the
program again.

Speaker 3 (15:51):
We have a lot more questions.

Speaker 5 (15:53):
I really appreciate this, and Margaret, thank you so much.

Speaker 3 (15:56):
Take care bybye.

Speaker 2 (15:59):
Okay, So let's go back to our discussion from last week.
We talked about putting one's primary residents vacation property shares
of an s corporation that owns a multifamily property. Whatever

(16:22):
your real estate is, you want to protect it from liabilities,
and under current federal law, the real estate must be
out of your name for a minimum period of five

(16:42):
years before it's totally invisible to healthcare claims. Now, some
people who are familiar with this area of the law
recall that this so called look back period used to
be three years. Now it's fine years. There's a bill
in Congress that would make it seven years, but thankfully

(17:05):
that hasn't passed yet, and people who do their planning
under the current law will be grandfathered into this so
called five year lookback period. So we do a properly
drafted trust. We put the real estate into the trust,

(17:27):
we continue to live there, we can continue to collect
any rental income, and at the end of the five years,
the party continues for my lifetime benefit. But I have
the comfort of knowing that that underlying asset is invisible
in the event that I require long term care. So

(17:51):
people sixty five and over have Medicare, and you have
a Medicare supplement that you're being in a dated right
now with commercials to change your Medicare supper before December seventh,
they were programmed and Medicare and the supplement do a

(18:12):
terrific job when we're hospitalized. But when we leave a hospital,
where do we go today?

Speaker 4 (18:19):
Long term care?

Speaker 3 (18:20):
We go to rehab.

Speaker 2 (18:22):
Because they say the hospitals today get us out quicker
and sicker, and we're in no shape to come home.

Speaker 3 (18:29):
So we go staggering.

Speaker 2 (18:30):
Into a rehab where your Medicare and your Medicare supplement
will cover up to So those are magic words because
you're not even guaranteed that you're going to get one
hundred days, but you're guaranteed that you're not going to
get more than one hundred days of coverage. So it's
important for us to say that the house is invisible

(18:55):
so that they can't put a lean on the property
if we need help. That costs in our area. If
you're listening to this broadcast in the Tri State area,
we have some of the best rehab facilities in the
United States, but they're also the most expensive.

Speaker 3 (19:15):
There. It's like sixteen thousand dollars a month.

Speaker 2 (19:18):
So if we want to avoid anyone putting a lean
on the property, we wanted to go into a trust,
why not just put the real.

Speaker 3 (19:29):
Estate in the names of the kids.

Speaker 2 (19:32):
That would be a huge mistake. My kids might be
the nicest people in the United States and they would never,
you know, turn me out of the house. But if
I bought the property for fifty thousand dollars in nineteen
seventy eight and it's now worth eight hundred and fifty
thousand dollars, which are not uncommon numbers in our area,

(19:57):
I would be giving the kids a huge, huge capital
gains problem. They would take my property with what we
call a cost basis equal to Mom's original purchase price
way back in nineteen seventy eight. When if it goes

(20:17):
to the kids at my death from a trust, they
get all of the taxes eliminated. They get zero capital
gains taxes. So it's super important for taxes. It's important
for my property taxes. If I put my house into
the kids' names, what happens to my star property tax exemption?

Speaker 3 (20:42):
Lose it?

Speaker 2 (20:42):
My husband's partial veterans exemption out the window. And now
if the house is in my son's name and he's.

Speaker 3 (20:52):
About to go through a divorce. This is a nightmare.

Speaker 2 (20:55):
My soon to be ex daughter in law would have
an interest in the property. Not to mention, if I
have grandchildren applying for college financial aid, my son would
have to disclose his ownership interest in the house as
an asset. And I am literally, you know, depriving a

(21:18):
grandchild of college financial aid. So you know, you want
to be very careful. You want to think about this,
and sometimes I hear people say we want to keep
things simple. We don't want to get involved in, you know,
thinking about a trust and educating ourselves about a trust.

(21:38):
But often keeping things simple on the front end can
result in a big catastrophe later on. You know, we
said that it's a very litigious society. What people don't
realize is that you are more likely to be involved
in a court battle with a four loved one then

(22:01):
with a stranger. You know, we're coming up to Thanksgiving
and you know where sometimes we have some arguments around
the Thanksgiving table, especially given its proximity to election day,
and we want to protect ourselves from liabilities which could

(22:22):
be again former loved one.

Speaker 4 (22:24):
I have quite a bunch of questions. Actually, I've been
asked from me to ask you. One of them is
one of my children needs more financial help. How can
I plan for this?

Speaker 2 (22:35):
Ye listen, If you have three kids and you tell
me that they're all perfectly situated and equally situated financially.

Speaker 3 (22:48):
I would be very skeptical.

Speaker 2 (22:49):
Right, you have three people, you have three very very
different situations.

Speaker 3 (22:55):
So you know, my job.

Speaker 2 (22:57):
Is just to give people things to think about. If
I have three children, even if let's say I have
a son who's a neurosurgeon and he's wildly successful, and
he tells me, Mom, I don't need anything, give everything,
you know to my two sisters who could use the money.

Speaker 3 (23:18):
At the end of the day.

Speaker 2 (23:21):
These documents are our last form of communication to our children,
and we want to, I think, avoid a situation where
it looks like I'm giving someone less. So I would say,
if I want to give more money to my daughter

(23:43):
because she needs help, maybe I go to the bank
and open up a CD, and that daughter is the
named beneficiary on that CD. But my trust and my
will say everything is split one third, one third.

Speaker 3 (23:59):
One third.

Speaker 2 (24:01):
That would be a graceful way of giving some more
to my daughter without anyone, you know, reading into the
unequal treatment within the last document. But the bigger question
is why does she need more help? Has she simply

(24:21):
had a lot of bad luck picking a few of
the wrong husbands and she's in a financial quandary that
you say, you know what she can get out of this,
And she's on the right track right now financially and
in terms of decision making. But if she is really

(24:42):
a financial black hole, if whatever you give her is
not enough, and I'm reminded of a doctor phil quote
that money alone does not solve money problems. So if
someone is a financial trend wreck, giving them a bunch

(25:02):
of money is only going to relieve that situation for.

Speaker 3 (25:07):
A little while.

Speaker 2 (25:08):
Direct larger Yeah, well, listen, they're going to be broke
again in no time flat. So maybe I say that
Susie gets one third of the estate, but she gets
it over the course of say twenty years, right, she
gets five percent a year for twenty years. And now

(25:31):
I know that I've given her a little bit of
a safety net if I know in my heart that
she has not saved one cent toward her own retirement.
So you know, we want to be creative when we
have a little bit, I'm gonna euphemistically say complexity within

(25:53):
our families. You know, read that to mean dysfunction. Who
amongst us, Paul doesn't have some dysfunction in our families?
I every family I know, I certainly do moving right along.
So we want to, you know, really be a little sensitive.

(26:13):
What are the potential fault lines later on? Now, what
if Susie is living in my home and the estate
leaves everything three ways and her brother and sister say, hey,
you need to make other arrangements pronto.

Speaker 3 (26:30):
We want to sell the house. So if you have
a child.

Speaker 2 (26:35):
Living in your home, it is very important to deal
with that within the estate plan. I don't have to
let them stay there for their entire lives, but that
is certainly one possibility. So I might say that the
property goes to marry Susie and Johnny, subject to Susie's

(27:00):
continued right to occupy the property for a period of
x fill in the blank. That might be six months,
it might be a year, it might be three years.
Let's say Susie's kids are in high school and I
don't want them disrupted, and we say in three years,

(27:21):
the youngest will have graduated from high school, so I
say that she can live there for a period of
not to exceed three years. So you want to build
in protections to keep our loved ones from doing battle
with each other later. You know, it's often when we
leave something unclear within the estate plan that folks are

(27:47):
doing battle later.

Speaker 4 (27:48):
What app you don't here's another question. What app you
don't have a family and you're a single person. Does
a single person make a trust?

Speaker 3 (27:55):
Yeah?

Speaker 2 (27:55):
I would encourage anyone who is single, and you know,
to my women friends out there, I think, regardless of
our current marital status, we have an eighty percent chance
of being the surviving spouse. So I tell women that

(28:16):
we need to plan for ourselves as if we will
be single, because statistically speaking, one day we will be single.
I have children. I think there's a one hundred percent
chance that they're going to be.

Speaker 3 (28:33):
Too busy with their own lives.

Speaker 2 (28:35):
You know, to really be involved in my long term
care planning.

Speaker 3 (28:41):
So I would encourage folks.

Speaker 2 (28:42):
Go on to my website and that's my asset protection
attorney dot com. There's an article there that I thought
was so cleverly titled when I wrote it, as state
planning and the single Girl and really talks about what
we want to put in place to ensure that our

(29:06):
future is the way we want it to look. And
in terms of planning for the future, I think you know,
as an interfaith minister, one of the greatest human fears
is the fear of aging. And if we can do
some things on our own inform ourselves, then it's going

(29:29):
to be a lot less scary looking to the future. Okay,
So with that we are wrapping up. Reach out to
me during the week on Instagram, at my lawyer and
or through the website my Asset Protection Attorney dot com
and I hope you'll join us again on seven ten
wor next Sunday at ten thirty.

Speaker 3 (29:51):
Thanks for being with us, Paul.

Speaker 4 (29:53):
Okay, thank you Anne, and thank everybody for welcome. Listen,
Mama

Speaker 1 (30:02):
Senior cap