Episode Transcript
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Speaker 1 (00:01):
Good morning and welcome to Life Happens Radio. We're your
host Pier O'Connor and Strauss. My name is Tom Morasco.
I am joined by my colleague this morning, Brent Stack. Brent,
thanks thanks for being here.
Speaker 2 (00:11):
Good morning time, Good morning folks.
Speaker 1 (00:14):
So on this show. The purpose of what we're looking
to achieve here is to provide education to all of
our listeners, whether that's retirement, protecting income, assets, providing for
loved ones, and most importantly, protecting yourself and the event
something happens during your lifetime. So the purpose of our
program is to make sure that you're equipped with the
(00:36):
right tools so you know how to manage your affairs
both during life and making sure that they're efficiently handled
when you are no longer here. We would like to
also invite you at this moment in time if there's
going to be a free workshop again catered toward our
education on trust planning. It'll be on September thirtieth and
(00:57):
the trustmitted workshop will be at the Capital Region Chamber
of the Colony. It is a lunch program that's from
twelve to one thirty, so seats are limited and you'll
hear about legal, financial and tax strategies to manage a
trust once it's set up and running. Feel free to
sign up on our website at pure law dot com,
p I E R R Law dot com on the
events tamp or call the office during weekdays at five
(01:20):
pine eight four or five nine two one zero zero,
and we hope that you enjoy and you get a
lot of few information out of there. Now kind of
in tune with that. Today our show is going to
be premised around the proper planning that should be in
place during our lifetime to avoid complex in the future. Now,
Brent has a significant experience in litigation, so he's going
(01:43):
to be talking to you about what are the perils
and some of the effects of improper or failure to
plan altogether, because all too frequently we have clients who
come in that don't have any kind of plan in place,
and more frequently than not, they do have a plan,
but they haven't touched it in quite some time, and
so it's outdated or in itself just insufficient.
Speaker 2 (02:06):
So I think we joke a lot on here that
you don't want to end up working with Brent, which
I find slightly offensive, but to a certain extent it's
probably true.
Speaker 1 (02:18):
You're wonderful, but if you're stepping into the equation, we
know that there's an issue exactly. So how our goal
here is is how do we avoid those issues? How
do we avoid those pitfalls? And so what we wanted
to spend some time on today is certain things that
every plan should have in place, right, every of the
proper foundation to any plan. Doesn't matter where you're situated
(02:42):
in life, your age, your asset resources, it's just what
everyone should have in order to avoid conflicts such as
potential guardianship proceedings or other conflicts, which again we'll get
into a little bit more in a little bit. So
most times people think of a state planning as well
(03:02):
what happens when we die, and that's usually the primary focus, right, Well,
I want to make sure I have a will, I
want to make sure that I'm giving my assets to
sow and so. But a lot of the times people
fail to think about, well, what happens if something occurs
while I'm still alive and I'm not dead, but I
don't have my faculties or I don't have the ability
to manage my own affairs, then what So a lot
(03:26):
of the time, what people maybe have A mistaken notion
is that well, I'm married or I have a close
family member, that they would be able to just simply
step in into whatever that's needed to help me. Right,
you might have a couple who have been married for
a number of years, Well, if something happens to me
and my spouse is just can obviously step in. But
what people don't understand is that that's not necessarily true.
(03:50):
Nobody just has the ability to step in and start
taking care of your affairs, whether that's financial or legal
decision making. Yeah, there are some exceptions to help care making,
but it's just not a given. So it's one of
the things that we stress a lot. And one of
the most powerful tools that is in any estate planning arsenal.
Speaker 2 (04:11):
Is a power of attorney correct, yep.
Speaker 1 (04:13):
And the power of attorney is specifically catered for financial
and legal decision making in the event that you are
incapacitated and unable to make those decisions. And now, yeah,
it might be the spouse, but what happens if you're single,
What happens if you don't have a significant other? Now
you want to be able to name who it is
that's going to be your agent to act on your
(04:33):
behalf and it may not be a family member, it
could be a friend. So that in naming successors and brand,
why don't you just tell the listeners In the event
we don't have a power of attorney and the person
does not have the ability, what would be the next
step in order for someone to be able to step
in and help you.
Speaker 2 (04:50):
Yeah, I mean so typically the courts, I think there's
a Court of Appeals decision that states that if you
have a power of attorney in a healthcare proxy, you
do not need a guardian. But if you don't have
either or both, you're going to need to undertake the
guardianship process. And it's timely or it's time consuming, it's
(05:15):
a bit expensive, and it can lead to, you know,
awkwardness because it's essentially a proceeding against the family member.
You know, Like you said, if it's spouses and one
just always assume that you know they would take care
of the other. Now you're involved in litigation essentially against
(05:37):
your spouse. We have to have when we commence a
guardianship proceeding, we have to have one party served on
behalf of the other. And at times when dementia has
already set in that can cause obviously awkwardness, but you
know anger, and yeah, it could become It can be
(06:00):
simple and easy, it can be on consent, but it
can also become adversarial. So yeah, we highly recommend that
you take the time do the power of attorney to
the healthcare proxy. These are documents that our office can
prepare on your behalf, much more simply than we can
(06:21):
go to court and litigate for guardianship.
Speaker 1 (06:24):
Yeah. And then the other issue with the guardianship ran,
which you can attest to, is that maybe different people
have different views as to who it is that should
be your decision maker. And while we may be capable
of making that determination and we know who we would want.
Now remember, by the time this is needed, you're no
longer able to speak for yourself. And the whole idea
(06:45):
behind these documents is making sure that you have people
there that are going to act as your mouth piece. Now,
but the guardianship, someone has to petition the court and
then the court has to decide who they believe is
in your best interest to make those decisions. And now
let's just say you have let's not let's say it's
not even a spouse. If it's a partner, and then
you have other family members such as siblings, and they don't.
Speaker 2 (07:07):
Get along exactly. Yeah, yeah, and the and the law
dictates dictates who is entitled to notice of these proceedings.
And you would you would be surprised who comes out
of the woodwork so to speak to contest and say, wait,
I should be guardian. And now you've got other family
members who are pitted against each other. Everyone thinks that
(07:30):
they should be in control of the assets. And you
don't have those documents to lean back on to say
I already decided who I want to handle my affairs
that Look at my power of attorney, look at my
health care proxy. If you don't have those documents, you
don't you can't do that. You can't say that, hight.
And that's a detriment, of course.
Speaker 1 (07:51):
And the good thing about these documents is that you
are able to name successors as well, So it's not
that you're going to be dependent or relying on one
person and it's gough of it. Something should have and
to them you're left with no recourse. But you are
able to name several successors so that in the event
one is unable to well, then you know who you
would designate as the backup to step in at that
point in time. And also you can have as far
(08:13):
as the power of attorney goes, you can have even
multiple agents. So if there are two people, let's just
say you're older and you have a spouse and you
have an adult child, well you can name them both
as agents. You can even give them independent authority to
act from one another, so that if one's available and
one's not, or let's just say you don't have a spouse,
but you have two adult children and you want to
entrust them both with decision making, you are able to
(08:35):
do that. But the whole point of having a plan
is that you want to maintain a level of control
over what happens to you and with your assets, and
you are putting the people in place as to who
you would want to make those decisions in your absence.
And I have found these because in my experience I
(08:58):
handle a lot of estate plan elder care planning, medicaid planning,
that it is helpful that even if somebody who thinks, well,
I'm young and I don't I'm not really concern with
that at the moment. I've had people, thankfully who have
done the power of attorney, and we're otherwise young and healthy.
And in one particular instance that I'm thinking of, I'm
(09:18):
thinking of a specific scenario where this this gentleman suffered
from a stroke unexpected and ended up not getting to
a point where he would be able to be independent
again and actually couldn't even return home. But because we
had the power of attorney in place, we were able
to utilize the power of attorney to do additional planning
(09:40):
to get him help for long term care purposes. And
so that's why these these documents are so powerful. It's
because we do not know what's going to happen in
a way, so.
Speaker 2 (09:50):
That purpose usually does happen, like to your point, unexpectedly, right,
I think that's the point.
Speaker 1 (09:55):
And and that's and at that point it's already too late, right,
So you can't after the fact because you don't have
the ability to sign or to make those designations. So
then we're in that situation where we're now back in
court looking for a guardianship. And again it's just that
loss of control as to who it is that you
would want. So the whole purpose of a plan is
(10:17):
when that event shouldn't and when it does occur, it's
always going to be some level of chaos because it's
either unexpected or traumatic. Right, and you're dealing with a
lot already. You have a lot on your plate and
it's going to be hard no matter what. But when
you have a plan in place, it at least gives
(10:40):
a clear roadmap with instructions as to what steps are
next to take, rather than trying to figure that out
while also trying to deal with the emotional side of
being in that type of situation.
Speaker 2 (10:53):
Right, right, right, And I always preface this by saying
no offense to courts or judges, but you know, they
don't care as much about your situation and your circumstances
as you do. They don't want to be put in
this position to have to select one family member over another.
(11:13):
They have to consider statutory factors. They're separated from the
emotion of you, you know, doing the prior planning, selecting
who you want to be in control, and now they're
now they're in this situation where people are fighting over
control and they might not make the best decision. I mean,
(11:36):
we work with excellent judges, but that's you don't want
to be in that situation where everything is virtually up
in the air, and this completely unconnected, unemotional third party
is going to decide who gets what. You don't want to.
You don't want to be in that position.
Speaker 1 (11:57):
You just to your point, they don't know you on
that person. They don't exactly, so they are relying on
what is being presented to them, and them as that
independent third party, have to take it everything into consideration
and then make a determination. So again, not that it's
ever to be. It's obviously always going to be for
your best interest, but it's not always maybe going to
(12:20):
be in a ligne with maybe what you would have
selected if that were your personal choice. Well, no, you
know what, I wouldn't have really designated this person, even
though I may not have an issue per se, but
I would rather it have been X. Right. But we're
not going to have the ability to make that decision
at that.
Speaker 2 (12:36):
Point, right when you walk through those courtroom doors, you
have like to your point, you've lost control. Now it's
up to an independent person.
Speaker 1 (12:46):
Yeah, And I also stress this for parents. Right, we
have children who are going off to college and they're eighteen. Well,
I'm sorry to say, as much as you might think
that these children are still relying on you, and that
you might feel entitled to have, you know, a certain
amount of control or leverage over their affairs. You don't
once they are a legal adult. That is it. So
(13:08):
I even encourage clients. Yeah, it doesn't mean that you
have to have necessarily assets in your own name, but
in order to just you know, make a decision for somebody,
you need to have these documents in place. And that's
why we say this is a foundation that everyone should have.
If you're a legal adult over the age of eighteen,
then you should have certain planning in place. So we're
going to be taking a short break. When we come back,
(13:31):
we're going to delve right back in into some healthcare
decision making and some other considerations that you should have.
Stay tuned, and we are back once again. Tom Morasco
from Peer, O'Connor and Strauss. I'm joined here by my
colleague Brient Stack. Brent, Hello again, do them well, Bud,
and we thank you guys for taking your time to
(13:51):
be here. We do this for you because we think
it's really important to get the message out and making
sure that people have the right education and the fact
that you're here listening. It says a lot, and we
do appreciate it. We believe it's vital. This is not,
we understand, like the most glamorous topic that everybody wants
(14:12):
to talk about or even want to consider, but it
does have very serious impact on not just your life,
but your loved ones. And that's why we do our
planning right. It's because we want to set everything up,
we want to take care of our loved ones. We
want to try to make this process as easy as
possible on the people who are going to be responsible
(14:33):
to step in and take care of these affairs for
us in the event that we can't. So previously we
were discussing the power of attorney and how that enables
you to name agents to act in your behalf for
financial and legal decision making. So right now I want
to spend a little bit of time on the healthcare
aspect of things, because that document is called the healthcare proxy. Now,
(14:57):
the healthcare proxy works in a similar fashion, So you
name an agent who would be responsible for making your
health care decisions. Now, unlike the power of attorney, you
cannot have multiple people serve at one time. It must
be one person at a time. But you can also
name successors as I said, and with the power of
attorney that in the event that the person that you've
(15:19):
named is unable to make or step into that position,
you have the backup who's able to step in at
that point. Now, there are some exceptions in the law
that allow the next of kin to be able to
step in an emergency situation to make those decisions. But
again I want to stress what I mentioned earlier. Not
(15:40):
everybody's family dynamic is the same, and not everybody has
the closest relationship with their family, or they might be
estranged from some of them, or they just might, by
the nature of things, be close with someone who's a
non family member whom they would want to entrust with
this decision. That goes along also to people who are
(16:01):
lifelong partners who've made the conscious decision to not get
married for whatever that reason is, and we don't want
to hold that against them. But it doesn't matter the
type of relationship that you have with an individual or
for how long they will not be able to even
if they should be the person to make that decision,
they won't not be permitted to unless you give them
that authority. And I know I left the last segment
(16:22):
off talking about you know, parents with adult children over
the age of eighteen. But guess what parents that goes
for you as well. Once your child hits eighteen, that
doctor is not permitted to speak to or disclose their
medical information unless there's a hippo release.
Speaker 2 (16:36):
Right. It doesn't mean you're not a parent anymore. It
just means.
Speaker 1 (16:40):
But what you're allowed to have access, so you get
up complete control exactly.
Speaker 2 (16:44):
And I think to that point, Tommy, we get a
lot of phone calls from people who are caught off
guard by that and what they've been my child all
my life? Yes, of course they have, but now they're
an adult.
Speaker 1 (16:56):
What do you mean I can't You can't tell me
about my son or my daughter? What does that mean?
Speaker 2 (17:00):
Right?
Speaker 1 (17:00):
So the point being is that it's very important to
at least be aware, and that's part of the show.
That's what we're doing. We're trying to bring awareness because
there's certain things that just people take for granted and
they just do not realize. And I had a great
teacher once tell me, your eyes don't see what your
mind doesn't know. And it's not because you're ignorant, it's
not because of anything. It's just you might take certain
(17:22):
things for granted, and you just might expect them to
be a certain way because you don't know otherwise. So
that's why again we're really grateful that you're taking the
time to spend the time with us and to learn,
because I think it's only going to advantage you and
your family to making sure that everybody is in the
best position to carry out your affairs the right way. So,
(17:46):
just going back to the healthcare proxy, that the way
that you know it typically would have in their hip authorization,
which would be separate from what is typically included at
least that's how we draft them in our office. Rather
than each time you're going to a position or to
some type of institution having to grant specific hip authorization
(18:08):
to a person, this one would be uniform. So the
proxy would allow your agent to be able to step in,
to be able to speak with your healthcare providers no
matter where they were, and in the event that you're
unable to make decisions for yourself, it allows that person
the authority to be able to step in and make
those decisions for you, and our healthcare directives you know,
(18:33):
can go a step further as well, and that also
we're referring to what is known as what's called a
living will, not to be confused with the last willin Testine,
but a living will which governs end of life decision making.
Now I'm going to pass this off to you in
a second as well, because this could also be a
point of major contention, and I'm sure some of our
(18:54):
listeners can maybe you know, remember the case of Terry
Schabow and how you know how awful that situation was.
But the living will allows you to be able to
put in writing and designate your agent to be able
to make that hard choice in the event that you're
at the end of your life with no chance of
(19:15):
being able to recover to some type of sensing, cognitive
life with a to a meaningful degree. And if if
your wish is to be at that point to withdraw
or sustain from receiving any type of life prolonged procedures
or any kind of treatments, then that wish is expressed
(19:39):
also through this, and it allows your agent to make
that And Breton, I'm sure, I mean Shavo is one example,
but I'm can only imagine.
Speaker 2 (19:49):
No, You're you're absolutely correct. If you have these documents
in place, properly executed. What they do is they travel
with you and for you. If, like you said, there
are situations where, in emergency circumstances the hospital will you
(20:11):
utilize the Family health Care Decisions Act, pick someone in
the line of succession who's available, and that person becomes
your healthcare decision maker. It might not have been the
person you selected. It could even be a neighbor. It
could have been the person who found you after a
(20:33):
slip and fall. The hospital has to have someone who
has that authority. Now, if you have the documents in place,
you've already named that person. But if you don't have
the documents in place, that person could be like I said,
a neighbor. It could be a family member that you
don't necessarily get along with and who has not heard
(20:54):
wishes expressed clearly. And it also doesn't travel. I mean,
you could be in the hospital and have one decision
maker be transferred to a nursing home, and now that
that nursing home appoints someone else as your decision maker.
If you have these documents in place, then you've already
made the choice. Those documents travel with you. Now you
(21:15):
have the person who you selected and express your wishes
to is consistently making those decisions known to the facilities
providing you with care.
Speaker 1 (21:25):
Yeah, and again I am stressing the point that it's
what your wishes are, right. You're designating someone to step
into your shoes that knows what you would have wanted
in a particular situation and making decisions based on that,
not their own personal beliefs of what their own personal
wishes are. It should always be about you, And the
whole purpose of putting a plan together is making sure
(21:48):
that you're expressing what you want and you are appointing
people who you believe are going to best take care
of your needs the way that you would have taken
care of them yourself if you were able to. And
so that's one of the points that I'm not going
to be able to stress enough throughout the entirety of
(22:09):
the show and to any of my clients that come
in that I speak with.
Speaker 2 (22:13):
And I think, like you said, Tom, I mean, these
are not they're not fun discussions to have with your
loved ones. That these aren't you know, fun appointments with
your attorney to you know, planning your end of days,
planning your decisions in the event you've become incapacitated. Who's
going to make those decisions and you know essentially what
(22:34):
you want with regard to the end of your life,
but you know it is important that you do that
you take these steps.
Speaker 1 (22:44):
Yeah, it's hard, but they have to be had. And again,
the point here is to also provide guidance to your
loved ones. It's not for them to have to guess
or it's already a hard decision to have to make
no matter what, Even if you're given a clear, decisive
answer like this is exactly what they want to want,
(23:06):
it's still hard on a person. But I can guarantee
that having it expressed in writing and absolutely clear that
this was something that you wanted and you were absolutely
okay with that, it does help with that decision making.
And that's the whole purpose of having to plan, is
to provide guidance so that in the event of turmoil,
(23:27):
in the thick of the chaos, in the midst of
emotional you know, upheaval, right, we are still able to
stick to a plan because one was set there while
you were still able to make the decisions for yourself.
And next we're going to be taking a break for
the news coming up, but afterwards we're going to be
(23:49):
talking about once we passed talking about wills, talking about probate.
So stay tuned and we'll be back to Hello and
welcome back you are Life Happens Radio with Pierre O'Connor
and Strauss, myn named Tom Morosco, joined by my colleague
Brent Stack, and in our first half of our show,
we discussed certain documents that should be in place while
(24:12):
you are still alive to handle affairs in the event
that you've become unable to do so for yourself, specifically
the power of attorney and the healthcare proxy. And again,
there is no time like the president, so people will
always ask, well, when do you think I should start
thinking about this or when I should start planning? And
as I mentioned, once you are a legal adult, there
(24:33):
are certain decisions that nobody's able to make for you
after that, so it is vital that while you are
still able to and you are still aware, that you
make those decisions now. So I would certainly encourage that
you do not wait, do not put it off. And
if it's been quite some time since you last reviewed
(24:54):
your documents, it's most likely time for an update. Right.
We usually tell our clients about every three years or
so that you you should really be going over your
estate plan thoroughly to make sure that Number one, does
it still convey our wishes that I that we have
now is it the same as they were then? Are
the people that we appointed still the same people we
would want now? Did something happen to somebody? Are there
(25:14):
any other special considerations that we need to take into account?
So there's a lot of different factors that go into
that decision making. So I think it's extremely vital that
you stay on top of it. So, like I said,
no time like the present. So we talked about during
our lifetime in the first half to show what we
need to have, what considerations there should be. But going
forward now I want to talk about, well, what about
(25:36):
end of life right and when we're no longer here,
how do we make sure that our assets are passed
on to our loved ones, that we're appointing the right
people to be in place to make sure that they
manage those affairs, and other considerations on improper or the
failure to plan and what those implications are. So most
people are familiar with a will, a last pull, intestainment,
(25:57):
and a last Bilin testament is used precisely to say
what you want done with your assets and whom it
is that you want to be in charge. So you
would appoint an executor who would be the manager of
your estate, and they would be responsible for petitioning the court,
serving notices to the requisite parties, collecting and administering your assets.
(26:18):
And that requires a process called probate, which Brent is
going to explain for us in a minute. But what
we want to stress there is that this is something
that does involve court involved and it is going to
require a sufficient amount of time and resources in order
to do Brent, why don't you tell our listeners a
(26:38):
bit more about probate and what's involved.
Speaker 2 (26:41):
Yeah, Probate is the process of I think it's a
Latin term that means to prove. It's to prove the
document is in fact your last will and testament. It
is not a quick process and it's not without its challenges.
I mean, if there is conflict within the family, you
(27:03):
might have a probate proceeding that is challenged. That means
someone else can say, wait, I have a will in
my back pocket and I think this is the real will,
or I think that when that will was executed, that
the you know, the testator lack of capacity. So now
I'm challenging that the validity of that will. And you
can be in court for for years. You can be
(27:28):
in probate for months to years, even when.
Speaker 1 (27:32):
There's no issue, I mean even when there's no here
exactly right. Yeah, you're common for it to take a year, right.
Speaker 2 (27:38):
You practice, Yeah, you practice in the city where the
volume is is much more extreme than it is up here.
And that's just sheer. You know, judicial resources managing cases
that are overwhelming for a court to manage.
Speaker 1 (27:53):
So you tell people how easy it is to contest,
because I want people to understand that, you know what
what's involved? Is it this rigorous process that somebody would
have to go through in order to contest if it
was in probate.
Speaker 2 (28:05):
No, I mean you just you if you're an interested party,
you receive a citation, you can appear on the citation
return date and just say I have a problem with this,
and you know, then you you get a certain amount
of time to formally present your issues with the will,
and then you can get yourself into the litigation process,
(28:26):
which involves discovery. It involves you know, just extensive scheduling
right now. I think I've had two cases in will
contests where you know, we're in discovery, we received the
scheduling order. I've got a couple trials scheduled for early
twenty twenty six.
Speaker 1 (28:46):
Yeah, and that's again, even whether or not the estate,
even if that party, the contesting party, provails, it will
still cause time and money that's going to be you know,
basically at the expense of the estate in order to
resis and Brent, please also describe to everyone that for
all the assets that are in the estate that are
(29:07):
subject to the probate while this is going on, do
people have access to these assets.
Speaker 2 (29:12):
Like no, no, absolutely not. I mean they you can't
touch them during the litigation process. If you do that,
you've got another issue. And then you've got turnover proceedings
because you have wrongfully disposed of or distributed assets that
that could potentially belong to other beneficiaries. And so the
assets are essentially frozen as they should be, so they're
(29:35):
preserved for who who should be properly entitled to them.
But yeah, you know, you're also you're also incurring legal
fees at the same time, which and those assets are
subject to.
Speaker 1 (29:48):
Well, that was and that was My next point is
that while this is going on, the reason why I'm
stressing this is that a lot of the people, and
I mean across the you know the America, right people,
One of the people those biggest assets are are homes
or real estate. Now, if the real estate is in
the it belongs in the estate. Well, what do you
(30:08):
think is happening with all those carrying costs? If there's
a mortgage, if there is taxes, insurance, utilities, all of
these costs are cruing throughout this entire process. So now
I tell my clients, I'm down here in the New
York City, the Boroughs and Long Island area, where probate
easily could take a year without any issue. Now, imagine
what kind of costs are being incurred for the for
(30:32):
the duration of a whole year.
Speaker 2 (30:34):
And at that time, you're paying those out of pocket,
and you're going to need permission from the court to
reimburse yourself if you're the estate administrator. So you're paying
those out of pocket and you're waiting for again a
court to make a final decision says, yet those are
legitimate and you can reimburse yourself right.
Speaker 1 (30:52):
And again, so when when this probate process. So probate
is for any asset that you die with in your
name alone that was not held was not an a
trust or did not have a beneficiary designation too. So
this is why it's also very important for you to
take inventory of what you have. I have so many
people who come in that, you know, let's say it's
(31:12):
a married couple and one person was always used to
handling the finances and the other spouse really didn't really
have an idea or a grasp of where things were.
I've had I personally, and I'm not exaggerating, I've had
clients come with garbage bags full of unopened mail because
there something happened to the person who is usually in
charge of the bills and the accounts, and they no
(31:33):
longer can communicate. They didn't have a clear system, and
they did not know genuinely did not know what they
had and where, So it was even impossible to try
to even start of trying to figure it out. Now,
imagine having to go through discovery just to figure out
where everything is. And meanwhile, you can't access any of
these things. So it's important to take inventory. Note how
(31:54):
is the title held? Are their beneficiaries? Are they up
to date? Because sometimes, let's say you open up an
account when you were younger and you might've had parents
that were alive at the time, or a sibling that
you named is beneficiary, but you've since been married, you've
got kids, and you just never thought to like, oh,
let me, I should probably check up on this, and
what if it you know, it could be completely outdated.
And or if you name the beneficiary who no longer
(32:16):
is with us and you pass, well guess what now
that ends up in your probate estate.
Speaker 2 (32:20):
Right, Survivorship accounts work as long as there's a survivor.
Speaker 1 (32:24):
Yeah, And I see that all the time too, where
it's like, well, I have the spouses who come in
that hold accounts jointly and like, well, something happens to me,
my spouse gets yeah. But what ends up happening is
that that spouse, when something does happen, doesn't follow through
and come in and say, oh, I need to update
this now, because now I'm the soul owner on this account. Right,
and now we're again going to be stuck in a
(32:46):
position where there's assets in the estate that we're going
to be required to probate. And yeah, just I want
to make clear, as Brent had mentioned earlier, that there
are specific parties that you have to notify no matter what,
and that doesn't matter whether or not you intended to
disinherit that or if you've been as strange for them
for a certain amount of years, you're still required to
provide them notice and obtain either something called a waiver
(33:06):
and consent or you have to cite them. And at
that point you've opened the door. So if they don't
agree and they want to either cause an issue or
just simply like I said, they don't agree with what
you put in there, they can cause an issue whether
or not they prevail. So it's extremely vital that you're
aware of that, and we take again inventory of what
(33:27):
we have and there are certain ways that we can
avoid probate. And that's you know, the rest of our conversation.
I want to kind of gear toward what are certain
steps that we can take in order to avoid that
kind of issue, because Brent, we love you, but I
don't want to have to call Brent. I don't want
to call him. I don't have to call him because
I don't have a problem, right, we don't want to
have problems. And again, the whole idea of the plan
(33:49):
is administering your estate or your affairs as efficiently as possible,
in a way that you would have wanted, in a
way that's going to be the least litigious and contentious.
And so a couple of other planning considerations that there
should be our trusts, which is our number one go
to And a lot of people have this notion that
(34:10):
it's like, oh, well, you have trusts when you have
a lot of money and I don't have that amount
of money, or that really probably doesn't concern me, But
that is completely incorrect. There are several different types of
trusts that could be used for multiple purposes. And let's
just say, for one example, you have a house or
an apartment, a co op, a condo. It doesn't matter
if you have a home, even if it's jointly held
(34:32):
with you and a spouse with rights of survivorship. Okay,
at some point or another, there's going to be one
of you left, and then upon the death of the
second of you, if we've done nothing with that house,
guess what we're going to be calling, Brent. We're going
to have to go through probate, and we're going to
have to wait in order to get that asset. As
I mentioned earlier, all of the carrying costs with that property.
(34:54):
You can't do anything with it. You're incurring these costs.
So it's like, did you really want to have to
spend however many thousands of dollars and wait however amount
of time before you can actually access this asset. Now
where the trust it works differently. Now, a trust looks
similar to a will, right. It designates someone who you
put in charge, which is a trustee rather than the executor.
(35:16):
It's still disposed of your assets the way that you want.
But the difference is that this is a private document.
This does not require court approval. It's its own being
and it is it administers itself right. So you have
the trustee who would step in so that even upon
your incapacity, they would be able to just step in
and continue your affairs fluidly without interruption. And if it's
(35:39):
something like upon death, then there is a piece of property.
For example, your trustee can move directly to sell if
that's the wish of the beneficiary. They don't have to
keep it. They don't have to wait for this whole process.
I don't have to notify anybody, I don't have to
wait to get approval, and I'm not subject to the
same concerns of a being can test it. Now, that's
(36:01):
not to say that it's impossible for somebody to contest
a trust, but the difference is that whereas with a
with a will, there is already a proceeding open and
if they get the invitation, they simply just need to
put in their rejection and say hey, I don't agree,
and they can put forth their case.
Speaker 2 (36:19):
I think you're right, Tommy, that's a really good point.
I mean, the a citation is essentially an invitation for
someone who wants to contest, and that gives them the
opportunity to. I think another common misconception with trust, Tommy,
and I think be important to speak to this is
people think that when they place their trusts in assets
or their assets and trust, that they lose access to them.
(36:42):
It's not mine anymore.
Speaker 1 (36:44):
Yeah, and that's that couldn't be further from the truth.
And that's regardless of the type of trust. Now, a
lot of people that there's many different types of trusts.
Categorically they can be broken down into revocable and irrevocable trusts.
With revocable trusts, yes, you remain in control. You're your
own trustee. You can amend, change, and to take away
(37:05):
or revocate at any time on your own volition, unilaterally,
without anyone else's approval. Now, with an irrevocable trust, that
is where people usually get this notion where like, oh,
it's no longer mine and I'm giving up this control
and I don't know that I can justify that, or
I don't know that I'm comfortable with doing that. But
what people don't realize is that, Okay, with an irrevocable trust,
(37:26):
you cannot be your own trustee, but there are residence
provisions that are in the trust, and nobody can take
an action without your approval and without your benefit. So
you would still be able to continue to occupy your residence.
In the event that it needed to be sold, you
can give the instruction for the property to be sold
(37:47):
and the proceeds would come back into the trust. You
have the ability to change who that trustee is at
any given time. You have the ability to change who
your beneficiaries are at any given time. So there is
some relinquishment of ConTroll by design, but it doesn't mean
that it is no longer yours, that you have no
control over it at all. We're going to take one
last break and when we come back, we're going to
(38:08):
wrap up are a little bit more about trust and
some other type of preventative measures you can take with
your estate planning. So says tuned, we'll be right back again.
You're listening to Life Happens Radio with Pier O'connoran Strauss
and welcome back to Life Happens Radio once again. We're
your hosts Pier O'Connor and Strouse, Tom Morasco joined by
Brent Stack. And while we were talking trusts, I just
(38:31):
wanted to remind everyone that on September thirtieth, we will
be holding our Trust Administration Workshop at the Capital Region
Chamber and Colony. Again. It is a lunch program from
twelve to one thirty seats are limited. There you'll learn
a little bit more about legal, financial and tax strategies,
a little bit more than what I'm able to delve
into right now in the short time that we have together.
(38:51):
But please be sure to sign up on our website
pierolaw dot com in our events tab or feel free
to call our office during weekdays at five one eight
four or five nine two one zero. So going back
to what we were talking about, we were discussing strategies
on how we can try to avoid the probate process. Right,
(39:12):
we won't want to have to necessarily have to go
through having to notify people that we not necessarily want
to and perhaps opening ourselves up to particularly some potential conflict.
That's the whole purpose of today's show, right, plan today
to avoid conflict tomorrow. So with the trust, there are
certain ways that again we can account for all of
(39:34):
our assets. It's not just the house, even with bank accounts, right,
we can either we can put accounts into the trust
now that are owned by the trust, or we can
even update the beneficiary designation on those accounts to flow
through the trust. Now, there's certain assets that don't go
into trusts at all, for example retirement accounts, but again
you are able to change your beneficiary designation so that
(39:57):
we can have everything ultimately flow through the trust. And
why we also find the trust to be so helpful
is that there is several different contingency planning provisions that
are within this trust that go well beyond the what
you would be able to do in an ordinary beneficiary designation,
(40:17):
because when you name somebody as a beneficiary on an account,
you cannot take into consideration their particular circumstances at that time.
So if it is a spouse, if it is another
loved one, but if in the event they became disabled
or were applying for receiving some type of government benefits,
any kind of outright inheritance at that moment in time
(40:39):
could potentially get them disqualified from those benefits. And then
they're then required to spend down the money that you
give them to pay for benefits that they were already receiving.
And that wasn't the intent. The intend is to make
somebody's lives more comfortable, and so there are ways that
you can help them, but not necessarily wanting to again
(41:00):
to do it for their detriment, that's not the whole design.
And then there are also further safeguards that we can
implement for beneficiaries through the trust, so that when they
inherit the asset from you, they can do so in
an asset protected way. What does that mean. That means
that if I leave in trust, for example, my kids
(41:21):
and I leave it to them in further trust rather
than outright. Well, I can also protect it from their
potential future creditors, financial issues, or divorcing spouses. There are
ways that you can go further to protect your loved ones.
So this is why the planning is so unique, and
(41:44):
trusts are really such a flexible tool. So people think
of it. Like I said, they have this one way
of thinking about things. Oh, I need to have a
lot of money, or it doesn't really make sense for
me because I don't have a lot. But that's not
necessarily true. You have to look at your particular circumstances,
what it is you do have, your loved ones, what
their situations are right, and again the ability to just
(42:05):
go beyond well, if this person's not there, who would
I really want to step in and that situation and
inherit and are there any special considerations? Are they disabled,
are they receiving some type of benefit or just maybe
you know what, I love them dearly, but they're not
really financially mature. I do not know whether I could
trust them with this kind of money, but I do
want to still provide for them. Well, guess what, we
(42:28):
can still put things into that intrust for them. We
can name trustees other than themselves that could manage the
money so that they have a means of accessing the money,
but to a way that it's not going to be
detrimental to them or to be open to, you know,
any issues that they might encounter in their life. When
you have somebody that's named outright and they get a
(42:51):
direct inheritance, well at that point there is no control
and whatever issues that they could be subject to, that
money will also be for those purposes. So having even
if it's just now you don't have a plan in place,
having a beneficiary designation is ideal because that will avoid probate.
(43:12):
And the idea though, is to sit down, make an
appointment with the attorney, go over your specifics, and make
sure that you have a plan in place, right, because
what we don't want. The last thing you're gonna want
is one putting somebody in a situation that they didn't
have to be in, or that there are issues that
you can avoid. I mean, Brent, I'm sure you've you've
(43:34):
seen so many things where it's just like, well, if
only they had done this, absolutely then I would not
have had to be in the situation.
Speaker 2 (43:42):
And maybe this family wouldn't be tearing itself apart, right now.
Speaker 1 (43:46):
Yeah, of course, yeah, that's true too. Yeah, that's a
great point. I mean I personally have seen that happen too,
where people don't agree and where the relationship might have
been fine beforehand and the nd that way. Right. So again,
there are certain considerations during lifetime that we discussed the
(44:09):
power of attorney, healthcare proxy, right, those are advanced directives
are Those are directions that we're preparing in advance of
something forbid happening to us, so that in the event
that they do, we have a means of stepping in
and being able to take care of those affairs. And
then once we passed. Yes, we always would also want
(44:29):
a will in addition to a trust and the other
planning methods. And I get that question too, well, Tommy,
why would I need a will? We're doing this trust.
You're telling me the importance of this trust, and you're
telling me how I'm gonna have all the assets flow
through the trust. But why it's important to have a
will is because sometimes there are certain things that fall
(44:49):
outside of our control. There are ways that we can
still come into money or into assets after we've passed
that we do not have control over, and if that
is the case, that it is required to go through
our estate, no matter how diligent we are or how
much we've planned. Brent, I'm sure you've seen this. But
I had a case recently where I had a client
who is involved with litigation prior to passing yep, and
(45:12):
it was over a piece of real estate by chance.
And it's now three years later and finally we're reaching
a settlement. But the settlement would have been payable to him. So, Brent,
what happens that sense?
Speaker 2 (45:24):
And now it's an a state asset, it's got to
pass through brobate, right.
Speaker 1 (45:29):
And but the way that we account for that when
we prepare a will when there is a trust, is
that we make it to be a companion to the trust.
And it is known what is called as a poor overwill.
So in effect, what it says is this, it acknowledges, okay,
that there happens to be this asset that has to
(45:50):
go through the estate that falls outside of the planning
that we took very careful consideration into doing. But again
something beyond our control, so we would go through court
to probate that one particular asset, and what it instructs
the executor to do is that upon receiving the proper
permission from the court, it instructs the executor to turn
(46:14):
over that asset, to pour it over into the trust
and give it to the trustee to distribute pursuit to
the terms of the trust. So one way or another,
it still makes its way back into the trust that
again has all the different contingency planning that we placed
into it. And contingency planning, guys, is not just a
(46:35):
matter of Okay, if somebody dies, then it goes here.
But a lot of the times, you know, it might
say that I give this to my children with a
designation that says per therapy. So that just means that
if my child were to pass away, but I had
a grandchild who survived, it would pass on to that grandchild.
But then there's other considerations you have to take into account, like, well,
(46:56):
what happens if that person's a minor, now, Brett, if
I named, if a minor was named, if a minor inherited,
and there and there wasn't a specific provision that has
a let's say, a provision for a minor trust, where
are we again.
Speaker 2 (47:11):
At that point, you're probably going to get a guardian
ad litem, which again is is someone who's a skilled professional,
but that person's going to represent the minor in circuits
court in appropriate proceeding proceeding. And you know, again now
you've got another uninterested party who you're paying from these
from assets of the estate, who you know may or
(47:35):
may not have, you know, the requisite knowledge of what
did this person truly intend, because now now they're kind
of looking at it from their own objective perspective, and
you know, they've got to make an assessment based on
what they see, not essentially what was known when when
(47:58):
we put these assets in most in terms of who
we're supposed to get them, who is intended to receive them.
Speaker 1 (48:04):
Right, And so again we're back in court. We're dealing
with the guardianship. And the only other consideration there too
is that once they become a legal adult at eighteen,
then they're entitled to that money. But that may not
be what you want. And depending on the value of
the estate. We have clients that you want to spread
that out over time. You know, they want to have
(48:26):
them have a certain sum at age twenty five, then
some at thirty with a final payout at thirty five.
But the whole point is that with the trust, you
have that type of control and leverage. Without it, you don't.
Speaker 2 (48:39):
So again, yeah, it's the best thing you could pass
on to your children is to keep them out of
circus court, to keep them at approbate.
Speaker 1 (48:49):
Yeah, and that goes for everything, right, whether that's during
the lifetime after our lifetime. The whole point here, and
we've been trying to stress it throughout the entirety of
our show and the premise of our platform, is to
state that having the proper plan now will event conflict
in the future, and the conflict can take shape in
many different forms. But it's just that it's not something
(49:11):
that you're gonna want to have to deal with. And again,
you may not be dealing with it, but your loved
ones most certainly will. So we thank you again for
you spending your time with us this Saturday. We hope
that it was very insightful. We do recommend that you
you call make an appointment to discuss your specific needs
and any questions you know where to call. Again, thank
(49:34):
you for joining Life Happens Radio, where Pierre O'Connor and
Strauss have a great weekend.
Good morning and welcome to Life Happens Radio. We're your
host Pier O'Connor and Strauss. My name is Tom Morasco.
I am joined by my colleague this morning, Brent Stack. Brent,
thanks thanks for being here.
Speaker 2 (00:11):
Good morning time, Good morning folks.
Speaker 1 (00:14):
So on this show. The purpose of what we're looking
to achieve here is to provide education to all of
our listeners, whether that's retirement, protecting income, assets, providing for
loved ones, and most importantly, protecting yourself and the event
something happens during your lifetime. So the purpose of our
program is to make sure that you're equipped with the
(00:36):
right tools so you know how to manage your affairs
both during life and making sure that they're efficiently handled
when you are no longer here. We would like to
also invite you at this moment in time if there's
going to be a free workshop again catered toward our
education on trust planning. It'll be on September thirtieth and
(00:57):
the trustmitted workshop will be at the Capital Region Chamber
of the Colony. It is a lunch program that's from
twelve to one thirty, so seats are limited and you'll
hear about legal, financial and tax strategies to manage a
trust once it's set up and running. Feel free to
sign up on our website at pure law dot com,
p I E R R Law dot com on the
events tamp or call the office during weekdays at five
(01:20):
pine eight four or five nine two one zero zero,
and we hope that you enjoy and you get a
lot of few information out of there. Now kind of
in tune with that. Today our show is going to
be premised around the proper planning that should be in
place during our lifetime to avoid complex in the future. Now,
Brent has a significant experience in litigation, so he's going
(01:43):
to be talking to you about what are the perils
and some of the effects of improper or failure to
plan altogether, because all too frequently we have clients who
come in that don't have any kind of plan in place,
and more frequently than not, they do have a plan,
but they haven't touched it in quite some time, and
so it's outdated or in itself just insufficient.
Speaker 2 (02:06):
So I think we joke a lot on here that
you don't want to end up working with Brent, which
I find slightly offensive, but to a certain extent it's
probably true.
Speaker 1 (02:18):
You're wonderful, but if you're stepping into the equation, we
know that there's an issue exactly. So how our goal
here is is how do we avoid those issues? How
do we avoid those pitfalls? And so what we wanted
to spend some time on today is certain things that
every plan should have in place, right, every of the
proper foundation to any plan. Doesn't matter where you're situated
(02:42):
in life, your age, your asset resources, it's just what
everyone should have in order to avoid conflicts such as
potential guardianship proceedings or other conflicts, which again we'll get
into a little bit more in a little bit. So
most times people think of a state planning as well
(03:02):
what happens when we die, and that's usually the primary focus, right, Well,
I want to make sure I have a will, I
want to make sure that I'm giving my assets to
sow and so. But a lot of the times people
fail to think about, well, what happens if something occurs
while I'm still alive and I'm not dead, but I
don't have my faculties or I don't have the ability
to manage my own affairs, then what So a lot
(03:26):
of the time, what people maybe have A mistaken notion
is that well, I'm married or I have a close
family member, that they would be able to just simply
step in into whatever that's needed to help me. Right,
you might have a couple who have been married for
a number of years, Well, if something happens to me
and my spouse is just can obviously step in. But
what people don't understand is that that's not necessarily true.
(03:50):
Nobody just has the ability to step in and start
taking care of your affairs, whether that's financial or legal
decision making. Yeah, there are some exceptions to help care making,
but it's just not a given. So it's one of
the things that we stress a lot. And one of
the most powerful tools that is in any estate planning arsenal.
Speaker 2 (04:11):
Is a power of attorney correct, yep.
Speaker 1 (04:13):
And the power of attorney is specifically catered for financial
and legal decision making in the event that you are
incapacitated and unable to make those decisions. And now, yeah,
it might be the spouse, but what happens if you're single,
What happens if you don't have a significant other? Now
you want to be able to name who it is
that's going to be your agent to act on your
(04:33):
behalf and it may not be a family member, it
could be a friend. So that in naming successors and brand,
why don't you just tell the listeners In the event
we don't have a power of attorney and the person
does not have the ability, what would be the next
step in order for someone to be able to step
in and help you.
Speaker 2 (04:50):
Yeah, I mean so typically the courts, I think there's
a Court of Appeals decision that states that if you
have a power of attorney in a healthcare proxy, you
do not need a guardian. But if you don't have
either or both, you're going to need to undertake the
guardianship process. And it's timely or it's time consuming, it's
(05:15):
a bit expensive, and it can lead to, you know,
awkwardness because it's essentially a proceeding against the family member.
You know, Like you said, if it's spouses and one
just always assume that you know they would take care
of the other. Now you're involved in litigation essentially against
(05:37):
your spouse. We have to have when we commence a
guardianship proceeding, we have to have one party served on
behalf of the other. And at times when dementia has
already set in that can cause obviously awkwardness, but you
know anger, and yeah, it could become It can be
(06:00):
simple and easy, it can be on consent, but it
can also become adversarial. So yeah, we highly recommend that
you take the time do the power of attorney to
the healthcare proxy. These are documents that our office can
prepare on your behalf, much more simply than we can
(06:21):
go to court and litigate for guardianship.
Speaker 1 (06:24):
Yeah. And then the other issue with the guardianship ran,
which you can attest to, is that maybe different people
have different views as to who it is that should
be your decision maker. And while we may be capable
of making that determination and we know who we would want.
Now remember, by the time this is needed, you're no
longer able to speak for yourself. And the whole idea
(06:45):
behind these documents is making sure that you have people
there that are going to act as your mouth piece. Now,
but the guardianship, someone has to petition the court and
then the court has to decide who they believe is
in your best interest to make those decisions. And now
let's just say you have let's not let's say it's
not even a spouse. If it's a partner, and then
you have other family members such as siblings, and they don't.
Speaker 2 (07:07):
Get along exactly. Yeah, yeah, and the and the law
dictates dictates who is entitled to notice of these proceedings.
And you would you would be surprised who comes out
of the woodwork so to speak to contest and say, wait,
I should be guardian. And now you've got other family
members who are pitted against each other. Everyone thinks that
(07:30):
they should be in control of the assets. And you
don't have those documents to lean back on to say
I already decided who I want to handle my affairs
that Look at my power of attorney, look at my
health care proxy. If you don't have those documents, you
don't you can't do that. You can't say that, hight.
And that's a detriment, of course.
Speaker 1 (07:51):
And the good thing about these documents is that you
are able to name successors as well, So it's not
that you're going to be dependent or relying on one
person and it's gough of it. Something should have and
to them you're left with no recourse. But you are
able to name several successors so that in the event
one is unable to well, then you know who you
would designate as the backup to step in at that
point in time. And also you can have as far
(08:13):
as the power of attorney goes, you can have even
multiple agents. So if there are two people, let's just
say you're older and you have a spouse and you
have an adult child, well you can name them both
as agents. You can even give them independent authority to
act from one another, so that if one's available and
one's not, or let's just say you don't have a spouse,
but you have two adult children and you want to
entrust them both with decision making, you are able to
(08:35):
do that. But the whole point of having a plan
is that you want to maintain a level of control
over what happens to you and with your assets, and
you are putting the people in place as to who
you would want to make those decisions in your absence.
And I have found these because in my experience I
(08:58):
handle a lot of estate plan elder care planning, medicaid planning,
that it is helpful that even if somebody who thinks, well,
I'm young and I don't I'm not really concern with
that at the moment. I've had people, thankfully who have
done the power of attorney, and we're otherwise young and healthy.
And in one particular instance that I'm thinking of, I'm
(09:18):
thinking of a specific scenario where this this gentleman suffered
from a stroke unexpected and ended up not getting to
a point where he would be able to be independent
again and actually couldn't even return home. But because we
had the power of attorney in place, we were able
to utilize the power of attorney to do additional planning
(09:40):
to get him help for long term care purposes. And
so that's why these these documents are so powerful. It's
because we do not know what's going to happen in
a way, so.
Speaker 2 (09:50):
That purpose usually does happen, like to your point, unexpectedly, right,
I think that's the point.
Speaker 1 (09:55):
And and that's and at that point it's already too late, right,
So you can't after the fact because you don't have
the ability to sign or to make those designations. So
then we're in that situation where we're now back in
court looking for a guardianship. And again it's just that
loss of control as to who it is that you
would want. So the whole purpose of a plan is
(10:17):
when that event shouldn't and when it does occur, it's
always going to be some level of chaos because it's
either unexpected or traumatic. Right, and you're dealing with a
lot already. You have a lot on your plate and
it's going to be hard no matter what. But when
you have a plan in place, it at least gives
(10:40):
a clear roadmap with instructions as to what steps are
next to take, rather than trying to figure that out
while also trying to deal with the emotional side of
being in that type of situation.
Speaker 2 (10:53):
Right, right, right, And I always preface this by saying
no offense to courts or judges, but you know, they
don't care as much about your situation and your circumstances
as you do. They don't want to be put in
this position to have to select one family member over another.
(11:13):
They have to consider statutory factors. They're separated from the
emotion of you, you know, doing the prior planning, selecting
who you want to be in control, and now they're
now they're in this situation where people are fighting over
control and they might not make the best decision. I mean,
(11:36):
we work with excellent judges, but that's you don't want
to be in that situation where everything is virtually up
in the air, and this completely unconnected, unemotional third party
is going to decide who gets what. You don't want to.
You don't want to be in that position.
Speaker 1 (11:57):
You just to your point, they don't know you on
that person. They don't exactly, so they are relying on
what is being presented to them, and them as that
independent third party, have to take it everything into consideration
and then make a determination. So again, not that it's
ever to be. It's obviously always going to be for
your best interest, but it's not always maybe going to
(12:20):
be in a ligne with maybe what you would have
selected if that were your personal choice. Well, no, you
know what, I wouldn't have really designated this person, even
though I may not have an issue per se, but
I would rather it have been X. Right. But we're
not going to have the ability to make that decision
at that.
Speaker 2 (12:36):
Point, right when you walk through those courtroom doors, you
have like to your point, you've lost control. Now it's
up to an independent person.
Speaker 1 (12:46):
Yeah, And I also stress this for parents. Right, we
have children who are going off to college and they're eighteen. Well,
I'm sorry to say, as much as you might think
that these children are still relying on you, and that
you might feel entitled to have, you know, a certain
amount of control or leverage over their affairs. You don't
once they are a legal adult. That is it. So
(13:08):
I even encourage clients. Yeah, it doesn't mean that you
have to have necessarily assets in your own name, but
in order to just you know, make a decision for somebody,
you need to have these documents in place. And that's
why we say this is a foundation that everyone should have.
If you're a legal adult over the age of eighteen,
then you should have certain planning in place. So we're
going to be taking a short break. When we come back,
(13:31):
we're going to delve right back in into some healthcare
decision making and some other considerations that you should have.
Stay tuned, and we are back once again. Tom Morasco
from Peer, O'Connor and Strauss. I'm joined here by my
colleague Brient Stack. Brent, Hello again, do them well, Bud,
and we thank you guys for taking your time to
(13:51):
be here. We do this for you because we think
it's really important to get the message out and making
sure that people have the right education and the fact
that you're here listening. It says a lot, and we
do appreciate it. We believe it's vital. This is not,
we understand, like the most glamorous topic that everybody wants
(14:12):
to talk about or even want to consider, but it
does have very serious impact on not just your life,
but your loved ones. And that's why we do our
planning right. It's because we want to set everything up,
we want to take care of our loved ones. We
want to try to make this process as easy as
possible on the people who are going to be responsible
(14:33):
to step in and take care of these affairs for
us in the event that we can't. So previously we
were discussing the power of attorney and how that enables
you to name agents to act in your behalf for
financial and legal decision making. So right now I want
to spend a little bit of time on the healthcare
aspect of things, because that document is called the healthcare proxy. Now,
(14:57):
the healthcare proxy works in a similar fashion, So you
name an agent who would be responsible for making your
health care decisions. Now, unlike the power of attorney, you
cannot have multiple people serve at one time. It must
be one person at a time. But you can also
name successors as I said, and with the power of
attorney that in the event that the person that you've
(15:19):
named is unable to make or step into that position,
you have the backup who's able to step in at
that point. Now, there are some exceptions in the law
that allow the next of kin to be able to
step in an emergency situation to make those decisions. But
again I want to stress what I mentioned earlier. Not
(15:40):
everybody's family dynamic is the same, and not everybody has
the closest relationship with their family, or they might be
estranged from some of them, or they just might, by
the nature of things, be close with someone who's a
non family member whom they would want to entrust with
this decision. That goes along also to people who are
(16:01):
lifelong partners who've made the conscious decision to not get
married for whatever that reason is, and we don't want
to hold that against them. But it doesn't matter the
type of relationship that you have with an individual or
for how long they will not be able to even
if they should be the person to make that decision,
they won't not be permitted to unless you give them
that authority. And I know I left the last segment
(16:22):
off talking about you know, parents with adult children over
the age of eighteen. But guess what parents that goes
for you as well. Once your child hits eighteen, that
doctor is not permitted to speak to or disclose their
medical information unless there's a hippo release.
Speaker 2 (16:36):
Right. It doesn't mean you're not a parent anymore. It
just means.
Speaker 1 (16:40):
But what you're allowed to have access, so you get
up complete control exactly.
Speaker 2 (16:44):
And I think to that point, Tommy, we get a
lot of phone calls from people who are caught off
guard by that and what they've been my child all
my life? Yes, of course they have, but now they're
an adult.
Speaker 1 (16:56):
What do you mean I can't You can't tell me
about my son or my daughter? What does that mean?
Speaker 2 (17:00):
Right?
Speaker 1 (17:00):
So the point being is that it's very important to
at least be aware, and that's part of the show.
That's what we're doing. We're trying to bring awareness because
there's certain things that just people take for granted and
they just do not realize. And I had a great
teacher once tell me, your eyes don't see what your
mind doesn't know. And it's not because you're ignorant, it's
not because of anything. It's just you might take certain
(17:22):
things for granted, and you just might expect them to
be a certain way because you don't know otherwise. So
that's why again we're really grateful that you're taking the
time to spend the time with us and to learn,
because I think it's only going to advantage you and
your family to making sure that everybody is in the
best position to carry out your affairs the right way. So,
(17:46):
just going back to the healthcare proxy, that the way
that you know it typically would have in their hip authorization,
which would be separate from what is typically included at
least that's how we draft them in our office. Rather
than each time you're going to a position or to
some type of institution having to grant specific hip authorization
(18:08):
to a person, this one would be uniform. So the
proxy would allow your agent to be able to step in,
to be able to speak with your healthcare providers no
matter where they were, and in the event that you're
unable to make decisions for yourself, it allows that person
the authority to be able to step in and make
those decisions for you, and our healthcare directives you know,
(18:33):
can go a step further as well, and that also
we're referring to what is known as what's called a
living will, not to be confused with the last willin Testine,
but a living will which governs end of life decision making.
Now I'm going to pass this off to you in
a second as well, because this could also be a
point of major contention, and I'm sure some of our
(18:54):
listeners can maybe you know, remember the case of Terry
Schabow and how you know how awful that situation was.
But the living will allows you to be able to
put in writing and designate your agent to be able
to make that hard choice in the event that you're
at the end of your life with no chance of
(19:15):
being able to recover to some type of sensing, cognitive
life with a to a meaningful degree. And if if
your wish is to be at that point to withdraw
or sustain from receiving any type of life prolonged procedures
or any kind of treatments, then that wish is expressed
(19:39):
also through this, and it allows your agent to make
that And Breton, I'm sure, I mean Shavo is one example,
but I'm can only imagine.
Speaker 2 (19:49):
No, You're you're absolutely correct. If you have these documents
in place, properly executed. What they do is they travel
with you and for you. If, like you said, there
are situations where, in emergency circumstances the hospital will you
(20:11):
utilize the Family health Care Decisions Act, pick someone in
the line of succession who's available, and that person becomes
your healthcare decision maker. It might not have been the
person you selected. It could even be a neighbor. It
could have been the person who found you after a
(20:33):
slip and fall. The hospital has to have someone who
has that authority. Now, if you have the documents in place,
you've already named that person. But if you don't have
the documents in place, that person could be like I said,
a neighbor. It could be a family member that you
don't necessarily get along with and who has not heard
(20:54):
wishes expressed clearly. And it also doesn't travel. I mean,
you could be in the hospital and have one decision
maker be transferred to a nursing home, and now that
that nursing home appoints someone else as your decision maker.
If you have these documents in place, then you've already
made the choice. Those documents travel with you. Now you
(21:15):
have the person who you selected and express your wishes
to is consistently making those decisions known to the facilities
providing you with care.
Speaker 1 (21:25):
Yeah, and again I am stressing the point that it's
what your wishes are, right. You're designating someone to step
into your shoes that knows what you would have wanted
in a particular situation and making decisions based on that,
not their own personal beliefs of what their own personal
wishes are. It should always be about you, And the
whole purpose of putting a plan together is making sure
(21:48):
that you're expressing what you want and you are appointing
people who you believe are going to best take care
of your needs the way that you would have taken
care of them yourself if you were able to. And
so that's one of the points that I'm not going
to be able to stress enough throughout the entirety of
(22:09):
the show and to any of my clients that come
in that I speak with.
Speaker 2 (22:13):
And I think, like you said, Tom, I mean, these
are not they're not fun discussions to have with your
loved ones. That these aren't you know, fun appointments with
your attorney to you know, planning your end of days,
planning your decisions in the event you've become incapacitated. Who's
going to make those decisions and you know essentially what
(22:34):
you want with regard to the end of your life,
but you know it is important that you do that
you take these steps.
Speaker 1 (22:44):
Yeah, it's hard, but they have to be had. And again,
the point here is to also provide guidance to your
loved ones. It's not for them to have to guess
or it's already a hard decision to have to make
no matter what, Even if you're given a clear, decisive
answer like this is exactly what they want to want,
(23:06):
it's still hard on a person. But I can guarantee
that having it expressed in writing and absolutely clear that
this was something that you wanted and you were absolutely
okay with that, it does help with that decision making.
And that's the whole purpose of having to plan, is
to provide guidance so that in the event of turmoil,
(23:27):
in the thick of the chaos, in the midst of
emotional you know, upheaval, right, we are still able to
stick to a plan because one was set there while
you were still able to make the decisions for yourself.
And next we're going to be taking a break for
the news coming up, but afterwards we're going to be
(23:49):
talking about once we passed talking about wills, talking about probate.
So stay tuned and we'll be back to Hello and
welcome back you are Life Happens Radio with Pierre O'Connor
and Strauss, myn named Tom Morosco, joined by my colleague
Brent Stack, and in our first half of our show,
we discussed certain documents that should be in place while
(24:12):
you are still alive to handle affairs in the event
that you've become unable to do so for yourself, specifically
the power of attorney and the healthcare proxy. And again,
there is no time like the president, so people will
always ask, well, when do you think I should start
thinking about this or when I should start planning? And
as I mentioned, once you are a legal adult, there
(24:33):
are certain decisions that nobody's able to make for you
after that, so it is vital that while you are
still able to and you are still aware, that you
make those decisions now. So I would certainly encourage that
you do not wait, do not put it off. And
if it's been quite some time since you last reviewed
(24:54):
your documents, it's most likely time for an update. Right.
We usually tell our clients about every three years or
so that you you should really be going over your
estate plan thoroughly to make sure that Number one, does
it still convey our wishes that I that we have
now is it the same as they were then? Are
the people that we appointed still the same people we
would want now? Did something happen to somebody? Are there
(25:14):
any other special considerations that we need to take into account?
So there's a lot of different factors that go into
that decision making. So I think it's extremely vital that
you stay on top of it. So, like I said,
no time like the present. So we talked about during
our lifetime in the first half to show what we
need to have, what considerations there should be. But going
forward now I want to talk about, well, what about
(25:36):
end of life right and when we're no longer here,
how do we make sure that our assets are passed
on to our loved ones, that we're appointing the right
people to be in place to make sure that they
manage those affairs, and other considerations on improper or the
failure to plan and what those implications are. So most
people are familiar with a will, a last pull, intestainment,
(25:57):
and a last Bilin testament is used precisely to say
what you want done with your assets and whom it
is that you want to be in charge. So you
would appoint an executor who would be the manager of
your estate, and they would be responsible for petitioning the court,
serving notices to the requisite parties, collecting and administering your assets.
(26:18):
And that requires a process called probate, which Brent is
going to explain for us in a minute. But what
we want to stress there is that this is something
that does involve court involved and it is going to
require a sufficient amount of time and resources in order
to do Brent, why don't you tell our listeners a
(26:38):
bit more about probate and what's involved.
Speaker 2 (26:41):
Yeah, Probate is the process of I think it's a
Latin term that means to prove. It's to prove the
document is in fact your last will and testament. It
is not a quick process and it's not without its challenges.
I mean, if there is conflict within the family, you
(27:03):
might have a probate proceeding that is challenged. That means
someone else can say, wait, I have a will in
my back pocket and I think this is the real will,
or I think that when that will was executed, that
the you know, the testator lack of capacity. So now
I'm challenging that the validity of that will. And you
can be in court for for years. You can be
(27:28):
in probate for months to years, even when.
Speaker 1 (27:32):
There's no issue, I mean even when there's no here
exactly right. Yeah, you're common for it to take a year, right.
Speaker 2 (27:38):
You practice, Yeah, you practice in the city where the
volume is is much more extreme than it is up here.
And that's just sheer. You know, judicial resources managing cases
that are overwhelming for a court to manage.
Speaker 1 (27:53):
So you tell people how easy it is to contest,
because I want people to understand that, you know what
what's involved? Is it this rigorous process that somebody would
have to go through in order to contest if it
was in probate.
Speaker 2 (28:05):
No, I mean you just you if you're an interested party,
you receive a citation, you can appear on the citation
return date and just say I have a problem with this,
and you know, then you you get a certain amount
of time to formally present your issues with the will,
and then you can get yourself into the litigation process,
(28:26):
which involves discovery. It involves you know, just extensive scheduling
right now. I think I've had two cases in will
contests where you know, we're in discovery, we received the
scheduling order. I've got a couple trials scheduled for early
twenty twenty six.
Speaker 1 (28:46):
Yeah, and that's again, even whether or not the estate,
even if that party, the contesting party, provails, it will
still cause time and money that's going to be you know,
basically at the expense of the estate in order to
resis and Brent, please also describe to everyone that for
all the assets that are in the estate that are
(29:07):
subject to the probate while this is going on, do
people have access to these assets.
Speaker 2 (29:12):
Like no, no, absolutely not. I mean they you can't
touch them during the litigation process. If you do that,
you've got another issue. And then you've got turnover proceedings
because you have wrongfully disposed of or distributed assets that
that could potentially belong to other beneficiaries. And so the
assets are essentially frozen as they should be, so they're
(29:35):
preserved for who who should be properly entitled to them.
But yeah, you know, you're also you're also incurring legal
fees at the same time, which and those assets are
subject to.
Speaker 1 (29:48):
Well, that was and that was My next point is
that while this is going on, the reason why I'm
stressing this is that a lot of the people, and
I mean across the you know the America, right people,
One of the people those biggest assets are are homes
or real estate. Now, if the real estate is in
the it belongs in the estate. Well, what do you
(30:08):
think is happening with all those carrying costs? If there's
a mortgage, if there is taxes, insurance, utilities, all of
these costs are cruing throughout this entire process. So now
I tell my clients, I'm down here in the New
York City, the Boroughs and Long Island area, where probate
easily could take a year without any issue. Now, imagine
what kind of costs are being incurred for the for
(30:32):
the duration of a whole year.
Speaker 2 (30:34):
And at that time, you're paying those out of pocket,
and you're going to need permission from the court to
reimburse yourself if you're the estate administrator. So you're paying
those out of pocket and you're waiting for again a
court to make a final decision says, yet those are
legitimate and you can reimburse yourself right.
Speaker 1 (30:52):
And again, so when when this probate process. So probate
is for any asset that you die with in your
name alone that was not held was not an a
trust or did not have a beneficiary designation too. So
this is why it's also very important for you to
take inventory of what you have. I have so many
people who come in that, you know, let's say it's
(31:12):
a married couple and one person was always used to
handling the finances and the other spouse really didn't really
have an idea or a grasp of where things were.
I've had I personally, and I'm not exaggerating, I've had
clients come with garbage bags full of unopened mail because
there something happened to the person who is usually in
charge of the bills and the accounts, and they no
(31:33):
longer can communicate. They didn't have a clear system, and
they did not know genuinely did not know what they
had and where, So it was even impossible to try
to even start of trying to figure it out. Now,
imagine having to go through discovery just to figure out
where everything is. And meanwhile, you can't access any of
these things. So it's important to take inventory. Note how
(31:54):
is the title held? Are their beneficiaries? Are they up
to date? Because sometimes, let's say you open up an
account when you were younger and you might've had parents
that were alive at the time, or a sibling that
you named is beneficiary, but you've since been married, you've
got kids, and you just never thought to like, oh,
let me, I should probably check up on this, and
what if it you know, it could be completely outdated.
And or if you name the beneficiary who no longer
(32:16):
is with us and you pass, well guess what now
that ends up in your probate estate.
Speaker 2 (32:20):
Right, Survivorship accounts work as long as there's a survivor.
Speaker 1 (32:24):
Yeah, And I see that all the time too, where
it's like, well, I have the spouses who come in
that hold accounts jointly and like, well, something happens to me,
my spouse gets yeah. But what ends up happening is
that that spouse, when something does happen, doesn't follow through
and come in and say, oh, I need to update
this now, because now I'm the soul owner on this account. Right,
and now we're again going to be stuck in a
(32:46):
position where there's assets in the estate that we're going
to be required to probate. And yeah, just I want
to make clear, as Brent had mentioned earlier, that there
are specific parties that you have to notify no matter what,
and that doesn't matter whether or not you intended to
disinherit that or if you've been as strange for them
for a certain amount of years, you're still required to
provide them notice and obtain either something called a waiver
(33:06):
and consent or you have to cite them. And at
that point you've opened the door. So if they don't
agree and they want to either cause an issue or
just simply like I said, they don't agree with what
you put in there, they can cause an issue whether
or not they prevail. So it's extremely vital that you're
aware of that, and we take again inventory of what
(33:27):
we have and there are certain ways that we can
avoid probate. And that's you know, the rest of our conversation.
I want to kind of gear toward what are certain
steps that we can take in order to avoid that
kind of issue, because Brent, we love you, but I
don't want to have to call Brent. I don't want
to call him. I don't have to call him because
I don't have a problem, right, we don't want to
have problems. And again, the whole idea of the plan
(33:49):
is administering your estate or your affairs as efficiently as possible,
in a way that you would have wanted, in a
way that's going to be the least litigious and contentious.
And so a couple of other planning considerations that there
should be our trusts, which is our number one go
to And a lot of people have this notion that
(34:10):
it's like, oh, well, you have trusts when you have
a lot of money and I don't have that amount
of money, or that really probably doesn't concern me, But
that is completely incorrect. There are several different types of
trusts that could be used for multiple purposes. And let's
just say, for one example, you have a house or
an apartment, a co op, a condo. It doesn't matter
if you have a home, even if it's jointly held
(34:32):
with you and a spouse with rights of survivorship. Okay,
at some point or another, there's going to be one
of you left, and then upon the death of the
second of you, if we've done nothing with that house,
guess what we're going to be calling, Brent. We're going
to have to go through probate, and we're going to
have to wait in order to get that asset. As
I mentioned earlier, all of the carrying costs with that property.
(34:54):
You can't do anything with it. You're incurring these costs.
So it's like, did you really want to have to
spend however many thousands of dollars and wait however amount
of time before you can actually access this asset. Now
where the trust it works differently. Now, a trust looks
similar to a will, right. It designates someone who you
put in charge, which is a trustee rather than the executor.
(35:16):
It's still disposed of your assets the way that you want.
But the difference is that this is a private document.
This does not require court approval. It's its own being
and it is it administers itself right. So you have
the trustee who would step in so that even upon
your incapacity, they would be able to just step in
and continue your affairs fluidly without interruption. And if it's
(35:39):
something like upon death, then there is a piece of property.
For example, your trustee can move directly to sell if
that's the wish of the beneficiary. They don't have to
keep it. They don't have to wait for this whole process.
I don't have to notify anybody, I don't have to
wait to get approval, and I'm not subject to the
same concerns of a being can test it. Now, that's
(36:01):
not to say that it's impossible for somebody to contest
a trust, but the difference is that whereas with a
with a will, there is already a proceeding open and
if they get the invitation, they simply just need to
put in their rejection and say hey, I don't agree,
and they can put forth their case.
Speaker 2 (36:19):
I think you're right, Tommy, that's a really good point.
I mean, the a citation is essentially an invitation for
someone who wants to contest, and that gives them the
opportunity to. I think another common misconception with trust, Tommy,
and I think be important to speak to this is
people think that when they place their trusts in assets
or their assets and trust, that they lose access to them.
(36:42):
It's not mine anymore.
Speaker 1 (36:44):
Yeah, and that's that couldn't be further from the truth.
And that's regardless of the type of trust. Now, a
lot of people that there's many different types of trusts.
Categorically they can be broken down into revocable and irrevocable trusts.
With revocable trusts, yes, you remain in control. You're your
own trustee. You can amend, change, and to take away
(37:05):
or revocate at any time on your own volition, unilaterally,
without anyone else's approval. Now, with an irrevocable trust, that
is where people usually get this notion where like, oh,
it's no longer mine and I'm giving up this control
and I don't know that I can justify that, or
I don't know that I'm comfortable with doing that. But
what people don't realize is that, Okay, with an irrevocable trust,
(37:26):
you cannot be your own trustee, but there are residence
provisions that are in the trust, and nobody can take
an action without your approval and without your benefit. So
you would still be able to continue to occupy your residence.
In the event that it needed to be sold, you
can give the instruction for the property to be sold
(37:47):
and the proceeds would come back into the trust. You
have the ability to change who that trustee is at
any given time. You have the ability to change who
your beneficiaries are at any given time. So there is
some relinquishment of ConTroll by design, but it doesn't mean
that it is no longer yours, that you have no
control over it at all. We're going to take one
last break and when we come back, we're going to
(38:08):
wrap up are a little bit more about trust and
some other type of preventative measures you can take with
your estate planning. So says tuned, we'll be right back again.
You're listening to Life Happens Radio with Pier O'connoran Strauss
and welcome back to Life Happens Radio once again. We're
your hosts Pier O'Connor and Strouse, Tom Morasco joined by
Brent Stack. And while we were talking trusts, I just
(38:31):
wanted to remind everyone that on September thirtieth, we will
be holding our Trust Administration Workshop at the Capital Region
Chamber and Colony. Again. It is a lunch program from
twelve to one thirty seats are limited. There you'll learn
a little bit more about legal, financial and tax strategies,
a little bit more than what I'm able to delve
into right now in the short time that we have together.
(38:51):
But please be sure to sign up on our website
pierolaw dot com in our events tab or feel free
to call our office during weekdays at five one eight
four or five nine two one zero. So going back
to what we were talking about, we were discussing strategies
on how we can try to avoid the probate process. Right,
(39:12):
we won't want to have to necessarily have to go
through having to notify people that we not necessarily want
to and perhaps opening ourselves up to particularly some potential conflict.
That's the whole purpose of today's show, right, plan today
to avoid conflict tomorrow. So with the trust, there are
certain ways that again we can account for all of
(39:34):
our assets. It's not just the house, even with bank accounts, right,
we can either we can put accounts into the trust
now that are owned by the trust, or we can
even update the beneficiary designation on those accounts to flow
through the trust. Now, there's certain assets that don't go
into trusts at all, for example retirement accounts, but again
you are able to change your beneficiary designation so that
(39:57):
we can have everything ultimately flow through the trust. And
why we also find the trust to be so helpful
is that there is several different contingency planning provisions that
are within this trust that go well beyond the what
you would be able to do in an ordinary beneficiary designation,
(40:17):
because when you name somebody as a beneficiary on an account,
you cannot take into consideration their particular circumstances at that time.
So if it is a spouse, if it is another
loved one, but if in the event they became disabled
or were applying for receiving some type of government benefits,
any kind of outright inheritance at that moment in time
(40:39):
could potentially get them disqualified from those benefits. And then
they're then required to spend down the money that you
give them to pay for benefits that they were already receiving.
And that wasn't the intent. The intend is to make
somebody's lives more comfortable, and so there are ways that
you can help them, but not necessarily wanting to again
(41:00):
to do it for their detriment, that's not the whole design.
And then there are also further safeguards that we can
implement for beneficiaries through the trust, so that when they
inherit the asset from you, they can do so in
an asset protected way. What does that mean. That means
that if I leave in trust, for example, my kids
(41:21):
and I leave it to them in further trust rather
than outright. Well, I can also protect it from their
potential future creditors, financial issues, or divorcing spouses. There are
ways that you can go further to protect your loved ones.
So this is why the planning is so unique, and
(41:44):
trusts are really such a flexible tool. So people think
of it. Like I said, they have this one way
of thinking about things. Oh, I need to have a
lot of money, or it doesn't really make sense for
me because I don't have a lot. But that's not
necessarily true. You have to look at your particular circumstances,
what it is you do have, your loved ones, what
their situations are right, and again the ability to just
(42:05):
go beyond well, if this person's not there, who would
I really want to step in and that situation and
inherit and are there any special considerations? Are they disabled,
are they receiving some type of benefit or just maybe
you know what, I love them dearly, but they're not
really financially mature. I do not know whether I could
trust them with this kind of money, but I do
want to still provide for them. Well, guess what, we
(42:28):
can still put things into that intrust for them. We
can name trustees other than themselves that could manage the
money so that they have a means of accessing the money,
but to a way that it's not going to be
detrimental to them or to be open to, you know,
any issues that they might encounter in their life. When
you have somebody that's named outright and they get a
(42:51):
direct inheritance, well at that point there is no control
and whatever issues that they could be subject to, that
money will also be for those purposes. So having even
if it's just now you don't have a plan in place,
having a beneficiary designation is ideal because that will avoid probate.
(43:12):
And the idea though, is to sit down, make an
appointment with the attorney, go over your specifics, and make
sure that you have a plan in place, right, because
what we don't want. The last thing you're gonna want
is one putting somebody in a situation that they didn't
have to be in, or that there are issues that
you can avoid. I mean, Brent, I'm sure you've you've
(43:34):
seen so many things where it's just like, well, if
only they had done this, absolutely then I would not
have had to be in the situation.
Speaker 2 (43:42):
And maybe this family wouldn't be tearing itself apart, right now.
Speaker 1 (43:46):
Yeah, of course, yeah, that's true too. Yeah, that's a
great point. I mean I personally have seen that happen too,
where people don't agree and where the relationship might have
been fine beforehand and the nd that way. Right. So again,
there are certain considerations during lifetime that we discussed the
(44:09):
power of attorney, healthcare proxy, right, those are advanced directives
are Those are directions that we're preparing in advance of
something forbid happening to us, so that in the event
that they do, we have a means of stepping in
and being able to take care of those affairs. And
then once we passed. Yes, we always would also want
(44:29):
a will in addition to a trust and the other
planning methods. And I get that question too, well, Tommy,
why would I need a will? We're doing this trust.
You're telling me the importance of this trust, and you're
telling me how I'm gonna have all the assets flow
through the trust. But why it's important to have a
will is because sometimes there are certain things that fall
(44:49):
outside of our control. There are ways that we can
still come into money or into assets after we've passed
that we do not have control over, and if that
is the case, that it is required to go through
our estate, no matter how diligent we are or how
much we've planned. Brent, I'm sure you've seen this. But
I had a case recently where I had a client
who is involved with litigation prior to passing yep, and
(45:12):
it was over a piece of real estate by chance.
And it's now three years later and finally we're reaching
a settlement. But the settlement would have been payable to him. So, Brent,
what happens that sense?
Speaker 2 (45:24):
And now it's an a state asset, it's got to
pass through brobate, right.
Speaker 1 (45:29):
And but the way that we account for that when
we prepare a will when there is a trust, is
that we make it to be a companion to the trust.
And it is known what is called as a poor overwill.
So in effect, what it says is this, it acknowledges, okay,
that there happens to be this asset that has to
(45:50):
go through the estate that falls outside of the planning
that we took very careful consideration into doing. But again
something beyond our control, so we would go through court
to probate that one particular asset, and what it instructs
the executor to do is that upon receiving the proper
permission from the court, it instructs the executor to turn
(46:14):
over that asset, to pour it over into the trust
and give it to the trustee to distribute pursuit to
the terms of the trust. So one way or another,
it still makes its way back into the trust that
again has all the different contingency planning that we placed
into it. And contingency planning, guys, is not just a
(46:35):
matter of Okay, if somebody dies, then it goes here.
But a lot of the times, you know, it might
say that I give this to my children with a
designation that says per therapy. So that just means that
if my child were to pass away, but I had
a grandchild who survived, it would pass on to that grandchild.
But then there's other considerations you have to take into account, like, well,
(46:56):
what happens if that person's a minor, now, Brett, if
I named, if a minor was named, if a minor inherited,
and there and there wasn't a specific provision that has
a let's say, a provision for a minor trust, where
are we again.
Speaker 2 (47:11):
At that point, you're probably going to get a guardian
ad litem, which again is is someone who's a skilled professional,
but that person's going to represent the minor in circuits
court in appropriate proceeding proceeding. And you know, again now
you've got another uninterested party who you're paying from these
from assets of the estate, who you know may or
(47:35):
may not have, you know, the requisite knowledge of what
did this person truly intend, because now now they're kind
of looking at it from their own objective perspective, and
you know, they've got to make an assessment based on
what they see, not essentially what was known when when
(47:58):
we put these assets in most in terms of who
we're supposed to get them, who is intended to receive them.
Speaker 1 (48:04):
Right, And so again we're back in court. We're dealing
with the guardianship. And the only other consideration there too
is that once they become a legal adult at eighteen,
then they're entitled to that money. But that may not
be what you want. And depending on the value of
the estate. We have clients that you want to spread
that out over time. You know, they want to have
(48:26):
them have a certain sum at age twenty five, then
some at thirty with a final payout at thirty five.
But the whole point is that with the trust, you
have that type of control and leverage. Without it, you don't.
Speaker 2 (48:39):
So again, yeah, it's the best thing you could pass
on to your children is to keep them out of
circus court, to keep them at approbate.
Speaker 1 (48:49):
Yeah, and that goes for everything, right, whether that's during
the lifetime after our lifetime. The whole point here, and
we've been trying to stress it throughout the entirety of
our show and the premise of our platform, is to
state that having the proper plan now will event conflict
in the future, and the conflict can take shape in
many different forms. But it's just that it's not something
(49:11):
that you're gonna want to have to deal with. And again,
you may not be dealing with it, but your loved
ones most certainly will. So we thank you again for
you spending your time with us this Saturday. We hope
that it was very insightful. We do recommend that you
you call make an appointment to discuss your specific needs
and any questions you know where to call. Again, thank
(49:34):
you for joining Life Happens Radio, where Pierre O'Connor and
Strauss have a great weekend.
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