Tag: grand rapids trusts lawyer

You Pay For What You Get

January 30, 2011 /

“You get what you pay for,” is a phrase that we’ve all heard so much it is has become almost a cliche.  What I’ve come to realize is that, although “you get what you pay for” may not be true in all cases, “you pay for what you get” seems to be true in all cases.  Whether the “cost” is money, like we typically think, or something intangible such as lost time, lost opportunity, worry, regret or pain.

You may have read my post about the Honda, the big screen and estate planning.  The idea being that we “pay” (money, time, emotions, etc.) for something based on the perceived value it has to us.  I was reminded of this when I talked recently with a nice gentleman.  At one point he said, “that’s more than I’m willing to pay.”  It doesn’t matter the context – estate planning or business planning – there’s a lot going on behind the scenes in that statement.

It could be a reflection of lack of concern, lack of understanding how things work (estate planning or business planning), not fully understanding the situation, or valuing other things higher than the estate planning or business planning being considered.  Ultimately, I think it is a combination of all of these (and more), although I see the value comparison being the deciding factor in most situations.

I’m not saying any decision is good, bad or indifferent.  I think it is good for us to understand how we make purchase decisions and to not forget all the non-monetary considerations that come into play and how they, ultimately, lead us to the decision we make.

How do you make a decision between two or more “purchases”?  Maybe it’s getting an iPad versus purchasing more life insurance, maybe it’s leasing a new car versus purchasing a new one, or getting a “discount” haircut versus going to a salon.  When you stop and think about the monetary and non-monetary considerations, how do YOU make your choices?  I would love to hear what you think of this!

Michael Lichterman is an estate planning and business planning attorney who helps families and business owners create a lasting legacy by planning for their Whole Family Wealth™.  This goes beyond merely planning for finances – it’s about who your are and what’s important to you.  He focuses on estate and asset protection planning for  the “experienced” generation, the “sandwich generation” (caring for parents and children), doctors/physicians, nurses, lawyers, dentists, professionals with minor children, family owned businesses and pet planning.  He takes the “counselor” part of attorney and counselor at law very seriously, and enjoys creating life long relationships with his clients – many of which have become great friends.

Intangible Assets and Your Burning House

January 23, 2011 /

As a Grand Rapids, Mi estate planning lawyer who focuses on helping you plan for your Whole Family Wealth™, I consider it my calling to determine what my clients truly care about and then, and only then, move forward with helping them plan to make sure their wishes are followed if something happened to them.

The tragedy of several West Michigan homes burning down (or partially down) over the past month has provided a prime example of what this Whole Family Wealth™ is.  I think most would agree that having your home burn down is a horrible tragedy, only made better if nobody is injured.  So what does a home burning down without any human injury have to do with estate planning?

Ask yourself this question: if your home was on fire, would you reach for the money you may have hidden in a drawer  or would you try to save the photo album that has the only pictures of your children as babies?  If you answered the way I expect you did, ask yourself if “traditional” estate planning is right for you or if you need something more.  Traditional estate planning focuses on money and assets . . . who you are and what is important to you is not a consideration.

Give it some serious thought because your answer (and more importantly your action or inaction) is what will shape your legacy.  Don’t make the mistake of thinking a “legacy” is something you have to wait until the end of your life to create. Call us at 616-827-7596 to schedule a Peace of Mind Planning Session to discover how you can share your values, insights, stories and experiences . . . not just your “stuff.”  Mention this blog post and we’ll waive the planning session fee (a $750 value!).

Michael Lichterman is an estate planning attorney who helps families and business owners create a lasting legacy by planning for their Whole Family Wealth™.  This goes beyond merely planning for finances – it’s about who your are and what’s important to you.  He focuses on estate and asset protection planning for  the “experienced” generation, the “sandwich generation” (caring for parents and children), doctors/physicians, nurses, lawyers, dentists, professionals with minor children, family owned businesses and pet planning.  He takes the “counselor” part of attorney and counselor at law very seriously, and enjoys creating life long relationships with his clients – many of which have become great friends.

The Downside to Leaving Your Estate to Heirs

November 28, 2010 /

I’m sure you’re wondering, “what are you talking about?  Isn’t it good to leave my estate to my heirs?”  Well . . . not necessarily.  As I mentioned in this earlier post, an “heir” is someone who inherits from you if you do not have a Will or a Trust.  That is, they inherit from you based on what Michigan’s “intestacy laws” say.

Before you assume that is “well and good,” consider these situations:

  • Second marriages – you may be surprised at the amount your children receive (or really what they do not receive).
  • Charitable gifts – if you want to benefit a charity, you better have a Will (or better yet, a Trust), because they are not “heirs.”
  • Special needs child – if receiving governmental assistance is important to their quality of life, too bad, because they are set to get their share outright as an “heir” when they turn 18.
  • A child (or spouse) who is a spendthrift or has substance abuse problems – in these cases one of the worst things you can do is give them a significant sum of money, yet they are entitled to it as an “heir” if you haven’t planned otherwise.

There are many more situations when being an “heir” may not be a good thing.  These are just some of the more common ones I’ve observed.

The great thing is that you can avoid these pitfalls by taking the time to setup an estate plan with a lawyer who focuses in estate planning.  These and many other undesired outcomes can be addressed through careful planning that centers on what is most important to you.  And it can help you leave the family legacy that is important to you.

If you find yourself in any of the situations listed above, call us at 616-827-7596 to schedule a Peace of Mind Planning Session to discover how you can “have your say.”  And if you mention this blog post, we’ll waive the planning session fee ($750 value!).

Michael Lichterman is an estate planning attorney who helps families and business owners create a lasting legacy by planning for their Whole Family Wealth™.  This goes beyond merely planning for finances – it’s about who your are and what’s important to you.  He focuses on planning for  the “experienced” generation, the “sandwich generation” (caring for parents and children), doctors/physicians, nurses, lawyers, dentists, professionals with minor children, and family owned business succession – and he is privileged to do so from a Christian perspective.  He takes the “counselor” part of attorney and counselor at law very seriously, and enjoys creating life long relationships with his clients – many of which have become great friends.

Estate Planning for Young Professionals … What You Don’t Know CAN Hurt You

November 21, 2010 /

I recently read this post by my colleague and friend, Steve Worrall, an estate planning attorney in Georgia.  Mr. Worrall points out several reasons why an estate plan is of critical importance for young professionals.  I’m not going to re-print the list here, you’ll have to read his post.  And I believe the items he mentions are just as important to Grand Rapids Young Professionals . . . hey, that’s catchy . . . I belong to a group by that name!  I assure you that estate planning is critically important whether you belong to the group or not.

As a young professional myself, I have a strong passion for reaching out to fellow Grand Rapids young professionals to make sure they have a plan in place for themselves and their family if something happened to them.  I’m happy to say that the idea of estate planning is typically warmly received.  I think the biggest struggle for Grand Rapids young professionals and planning is that nobody has ever explained the importance of estate planning to them.  As a matter of fact, if I were not an estate planning lawyer I probably wouldn’t have heard about the importance of estate planning either!

And that is why I try to get the word out through speaking engagements and networking with my fellow young professionals.  Being one, and knowing many, let’s me know that young professionals do recognize the importance of estate planning…as long as someone will care enough to talk with them about it.  You’ve worked hard in college, your job, and possibly post-graduate work and you surely don’t want all you’ve worked for to be lost to court proceedings, costs and potentially not benefiting those for whom you cared the most.  And you don’t have to be married or have children to benefit from estate planning.

Finally, don’t forget to work with a grand rapids estate planning lawyer who plans for life by having systems and processes in place to make sure your estate plan is kept up to date.  With all the hustle and bustle of life as a young professional, there is no doubt that your life, your assets and the law is going to change throughout your life.  You should make sure that your estate plan changes to keep up and that your estate planning attorney doesn’t leave the responsibility for the changes all on your shoulders.

Don’t let Michigan law determine what will happen to what you’ve worked so hard for.  Call us at 616-827-7596 to find out what would happen if something happened to you and how YOU can have a say in how things are handled.

Michael Lichterman is an estate planning attorney who helps families and business owners create a lasting legacy by planning for their Whole Family Wealth™.  This goes beyond merely planning for finances – it’s about who your are and what’s important to you.  He focuses on planning for  the “experienced” generation, the “sandwich generation” (caring for parents and children), doctors/physicians, nurses, lawyers, dentists, professionals with minor children, and family owned business succession – and he is privileged to do so from a Christian perspective.  He takes the “counselor” part of attorney and counselor at law very seriously, and enjoys creating life long relationships with his clients – many of which have become great friends.

A Week Dedicated to Estate Planning

October 17, 2010 /

Did you know that this week is Estate Planning Awareness week in Michigan and across the nation?  Well, it is.  And you can read the Michigan proclamation by clicking here. Interestingly enough, Governor Granholm left one important estate planning document out of her proclamation…the durable power of attorney.  Don’t forget that one!

Estate Planning is one of the most overlooked areas of personal financial management.  It is estimated that over 120 million Americans do not have up-to-date estate plans to protect their families in the event of sickness, accidents, or untimely death (yikes!).  This costs the working classes and the more affluent wasted dollars and hours of hardship each year that can be greatly minimized with action and advanced planning.

Th reasons for a week dedicated to estate planning awareness are many and varied.  Some of the reasons given in the legislation that put the week in place are:

  • Estate planning can greatly assist Americans in preserving assets built over a lifetime for the benefit of their family, heirs, or charities;
  • Estate planning encourages timely decisions about the method of holding title to certain assets, the designation of beneficiaries, and the possible transfer of assets during life;
  • Many Americans are unaware that a lack of estate planning and “financial illiteracy” may cause their assets to be disposed of to unintended people by default through the complex process of probate;
  • Careful planning can prevent family members or other beneficiaries from being subjected to complex legal and administrative processes requiring significant expenditure of time, and greatly reduce confusion or even animosity among family members or other heirs upon the death of a loved one

And parents with minor children must not forget that estate planning is the way to make sure you’ve legally documented who you want to care for your children if you pass away or are incapacitated, so that they don’t end up in the arms of strangers or Child Protective Services!

If you haven’t put an plan in place for your family (young, older or in between), why not?  I encourage you to show your family how much your care about them by putting a plan in place before it’s too late.  If you don’t, the State of Michigan has a “one size fits all” plan for you.

And if you have put an estate plan in place for your family, when was it last updated?  Your life, the law and what you have are constantly changing . . . your plan needs to change along with it.  What happens if you don’t?  It’s difficult to say until something happens.  However, there is a good chance it will fail to accomplish what you wanted if it isn’t kept updated, and once something happens, it’s too late!

Consider talking with your family, friends and others you care about to share with them the importance of planning and keeping your plan updated.  National Estate Planning Week is a great way to start talking about the subject.  If you, your family or friends have any questions, call us at 616-827-7596 or contact us here.

Michael Lichterman is an estate planning attorney who helps families and business owners create a lasting legacy by planning for their Whole Family Wealth™.  This goes beyond merely planning for finances – it’s about who your are and what’s important to you.  He focuses on planning for  the “experienced” generation, the “sandwich generation” (caring for parents and children), doctors/physicians, nurses, lawyers, dentists, professionals with minor children, and family owned business succession – and he is privileged to do so from a Christian perspective.  He takes the “counselor” part of attorney and counselor at law very seriously, and enjoys creating life long relationships with his clients – many of which have become great friends.

The Shocking Truth About Michigan Living Wills

October 13, 2010 /

The first shocking truth is this: a Living Will is not a Will at all.  A Will is a document that, when approved by the probate court, determines how and to whom your “stuff” is distributed to when you pass away.  A Living Will is a document that instructs physicians and others to withhold or withdraw life-sustaining treatment when the patient’s death is certain.  It is called a “living” will simply because the declaration is made by a person when he or she is still alive and able to make medical decisions.

The second, and bigger, shocking truth is this: Living Wills have no explicit legal support in Michigan.  That’s right, a Living Will is not a “legal document” in Michigan and is not required to be followed.  Unlike many states, Michigan has no legislation and there are no cases (that I can find) specifically authorizing living wills or requiring that they be followed.  Surprised?  Quite honestly, I was too when I first found out.

So what can you do if you want to express your wishes as to end-of-life decisions?  Michigan does have a Durable Power of Attorney and Patient Advocate Statute that allows you to designate who you want making healthcare decisions if you are unable to participate in your healthcare decisions.  I suggest including living will-like provisions in your patient advocate designation as the surest way to have them recognized.  If you absolutely want a document titled “living will,” then make sure to have a patient advocate designation as well and explicitly incorporate the living will by reference in your patient advocate designation.

Choosing someone to make medical decisions on your behalf when you are unable is one of the most important decisions you can make.  Because of how important this decision is, why wouldn’t you discuss your wishes and options with an attorney who specializes in estate planning?  Take the step of turning your wishes into directives by calling us at 616-827-7596 or contacting us here.

Michael Lichterman is an estate planning attorney who helps families and business owners create a lasting legacy by planning for their Whole Family Wealth™.  This goes beyond merely planning for finances – it’s about who your are and what’s important to you.  He focuses on planning for  the “experienced” generation, the “sandwich generation” (caring for parents and children), doctors/physicians, nurses, lawyers, dentists, professionals with minor children, and family owned business succession – and he is privileged to do so from a Christian perspective.  He takes the “counselor” part of attorney and counselor at law very seriously, and enjoys creating life long relationships with his clients – many of which have become great friends.

“Oh, We Didn’t Use an Attorney…We Bought It Online”

July 28, 2010 /

Because I regular comment about the risks and dangers of online estate planning documents, I’ll keep this post short.  The words above were heard by a banker friend of mine.  The context of the statement is just to good to not write a post about it.

The customers have a very elderly aunt (in her 90s) for whom they have power of attorney.  They brought the document into the bank because aunt needed to them to get into her safe deposit box.  So the banker sends the power of attorney to the bank’s legal department.  The answer back – “no.”  Why?  Because the power of attorney made a very general statement about financial powers and did not include the ability to access a safe deposit box.  The banker’s suggestion to them was to go back to the attorney who drafted it and have it changed.  They’re response was, “oh, we didn’t use an attorney . . . we bought it online.”  So, they had to go get elderly aunt who lives almost an hour away, bring her into the bank on a different day, and have her authorize drilling the safe deposit box (she had lost the keys).  Were they upset?  You bet they were!  But it was of their own doing.

And they were lucky!  How?  Because if aunt hadn’t been competent, they would have had to go to court to get the authorization.

Almost every attorney I know who specializes in estate planning includes a provision in the power of attorney to cover the above example.  Why?  Because it’s what we do.  We deal with it on a daily basis.  Although not having the one provision is not the point, we know that more and more financial institutions are requiring specific authority for different transactions such as accessing a safe deposit box.

Do you have a similar story?  Email me or share it in the comments below.  I always enjoy hearing from my blog readers.

Michael Lichterman is an attorney specializing in estate planning and helping provide peace of mind to families and businesses throughout Grand Rapids and West Michigan.  He specializes in Whole Family Wealth™ planning for professionals with minor children, doctors/physicians, nurses, lawyers, and the “sandwich generation” (caring for parents and children) – and does so from a Christian perspective.  He takes the “counselor” part of attorney and counselor at law very seriously, and enjoys creating life long relationships with his clients – many of which have become great friends.

Motley Fool Tries to Explain a Trust

July 25, 2010 /

You know me.  I’m not a fan of folks giving advice in an area about which they’re not qualified.  And as long as people would take it for what it’s worth and seek out the advice of professionals in the area, I’m ok with it.  But many do not.  Many folks hear or read advice from a big name (e.g., Dave Ramsey) and take it as the best advice to follow, rather than just the opinion of someone who is not a professional in the area.

So, what does that have to do with the Motley Fool?  It is exactly what they did in their “Ask the Fool” section in the Sunday, July 25, 2010 business section of the Grand Rapids Press.  First, I want to say that I’m a big fan of the Motley Fool for financial advice.  Much like I’m a fan of Dave Ramsey’s advice for getting out of debt.  However, when they decide to go “off the farm” and delve into an area that is not their expertise, my enthusiasm for their advice quickly wanes.

The question asked in the “Ask the Fool” section was: What’s a trust?  Brevity of the response aside, it mis-stated part of the concept and gave some advice that is far short of ideal.  They stated that a trust is a legal tool whereby someone gives control of property to a person or an institution.  Ok, close enough in my book.  I would say it is a contract/agreement between the creator of the trust and the trustee agreeing that the trustee will hold title/ownership of the assets for the benefit of the beneficiary(ies).  Then they go on to say that the beneficiary owns the property but the trustee controls it.  I beg to differ.  Who the “owner” is depends on the terms of the trust.  Maybe the beneficiaries are the owner, maybe not.  Yet they just make the blanket statement and leave it at that.

Some will say, “Mike, you’re really splitting hairs here.”  Maybe I am, maybe I’m not.  So surely they must have advised the person asking the question to talk to an estate planning attorney, right?  Nope!  Their response was to “learn more from a financial adviser!”  Yep, that’s right.  A financial adviser.  I guess that shouldn’t be a surprise since Motley Fool is known for giving sound financial advice.  Yet here they are (incorrectly) answering a question about a “legal tool” (their words) and then directing folks to a financial adviser rather than an estate planning attorney.  Would they suggest a reader talk to an estate planning attorney about the best long-term investment to get the reader to retirement?  Of course not!

So there you have it.  Again, a well respected person/group highly qualified in one area can’t help but give advice on a topic about which they are not professionals.  And then they direct readers to someone who, although qualified in the financial arena, is also not qualified to give proper advice.

What do you think?  Am I blowing these issues out of proportion?  Should these individuals and institutions be held accountable for the “off the farm” advice they give and the way it could harm the legacy of families?  I would love to hear your thoughts . . . even if it is to tell me I’m “off the farm.”

Michael Lichterman is an attorney specializing in estate planning and helping provide peace of mind to families and businesses throughout Grand Rapids and West Michigan.  He specializes in Whole Family Wealth™ planning for professionals with minor children, doctors/physicians, nurses, lawyers, and the “sandwich generation” (caring for parents and children) – and does so from a Christian perspective.  He takes the “counselor” part of attorney and counselor at law very seriously, and enjoys creating life long relationships with his clients – many of which have become great friends.

Legacy Planning for Your Whole Family Wealth™

July 22, 2010 /

When meeting people for the first time, I’m regularly asked “what do you do?”  I help families create a lasting legacy through Whole Family Wealth™ Planning.  Of course that prompts the question, “what is Whole Family Wealth™?”  I thought I would share the answer here so everyone can benefit.

Whole Family Wealth™ is about planning to pass on more than just what you have – it’s about who you are and what is important to you.  Your values, insights, stories and experiences.  Because it is those values, insights, stories and experiences that are going to matter most to your children/grandchildren when you are no longer around.

For instance, the Allianz American Legacies Study found that non-financial items that parents leave behind, like ethics, morals, faith and religion, are ten times more important to people than the financial aspects of inheritance.  And that makes sense.  If you think about it, by having your values, insights, stories and experiences shared with them, your family will be able to build their own financial wealth.  Sadly, it doesn’t work in reverse.  Once you are gone, so are any values, insights, stories and experiences you haven’t passed on.  Experience has shown me that even though we think we do a great job of sharing those “intangible assets,” in fact we have so much more that we could have shared that would have added a lot to the Whole Family Wealth™ of our loved ones.

So, how do we plan for your Whole Family Wealth™?  We do several things:

  • First, we take a significant amount of time to really learn about who you are as a person – your goals, wishes, hopes, and dreams for yourself and for your loved ones.  We want to know who you are as a person and what is important to you.  One of our clients commented that “Mike was very easy to talk to and I was able to convey my thoughts and feeling about my plan.  He listened to me very patiently and gave me his full attention.”
  • Second, we work with you to determine how we can use planning as a way to pass on these goals, wishes, hopes and dreams.  The idea being that your plan is uniquely representative of who you are and what is important to you.
  • Third, we include ongoing reviews of your planning at least every 3 years in all of our planning levels to make sure your plan is still in line with your legacy goals.
  • Fourth, we include a Priceless Conversation in all our planning levels.  This is a conversation we have with you on various subjects that enables you to share your legacy from your heart, not your head.  We record the conversation to a CD which is then placed in a presentation box with a summary of the conversation and the questions – this becomes the first part of your “legacy library.” There are numerous topics about which we can have a Priceless Conversation.
  • Finally, we are constantly seeking out new ways to help you convey more of your Whole Family Wealth™ based on our own efforts and your feedback

Have questions?  Curious to know more?  Wonder how your specific family situation can benefit from Whole Family Wealth™ Planning?  Give us a call or send us an email.  And if you reference this blog post your Peace of Mind Planning Session will be FREE ($750 value).

Michael Lichterman is an attorney specializing in estate planning and helping provide peace of mind to families and businesses throughout Grand Rapids and West Michigan.  He specializes in Whole Family Wealth™ planning for professionals with minor children, doctors/physicians, nurses, lawyers, and the “sandwich generation” (caring for parents and children) – and does so from a Christian perspective.  He takes the “counselor” part of attorney and counselor at law very seriously, and enjoys creating life long relationships with his clients – many of which have become great friends.

A Family Mission Statement Can Help Any Family

June 30, 2010 /

This is a guest post from Ron VanSurksum, CFP originally posted on his blog here and reproduced here with his express permission.

A Family Mission Statement Can Help Any Family Manage Assets, Philanthropy and Direction

A family doesn’t need a surname like Vanderbilt to benefit from a family mission statement.  A mission statement is a collaborative document created by one or more generations of family so standards and goals can be set for the handling of all family assets, including businesses and philanthropy in particular.

While mission statements aren’t legal documents – in fact, many are done both in written form and on videotape as a companion to legal wills and directives –  their purpose is to make a record of the family’s values, goals and aspirations and how those sentiments should drive future decisions about family wealth management, business succession plans and charitable pursuits.  Multi-national companies have mission statements. Non-profit corporations have mission statements.  A mission statement for your family, helps identify and clarify specific values and goals, facilitates group decisions, instills confidence and encourages unity.

It should also identify family leadership who will work with other relatives in implementing those goals.

While the end product should produce a document built from discussion, argument and consensus, it’s not so much about the piece of paper as the process. Many families start the process as a way to build consensus about long-term financial, business, estate and philanthropic goals, but the conversation can take twists and turns that don’t directly involve the family money. In this process, a family can identify the strengths, weaknesses and unearthed priorities of all family members and might reveal leadership few had expected.

Trained financial advisors including financial planners, tax experts and estate attorneys, can help explain the process and set an agenda for families to follow in creating the mission statement. While some extended families may elect to bring in a facilitator to guide their process, there are generally four components to a family mission statement – estate issues, philanthropy, business planning and family dynamics in general.

It also helps to start with some questions that can guide the discussion.  Many experts start with questions that first get family members talking about their relationships and how their dynamics work, and then move into business and money matters.

  • What’s most important about our family?
  • What do you think our goals should be?
  • When do you feel most connected to the rest of us?
  • How should we relate to one another?
  • What are our strengths as a family?
  • Where do you think we’ll be as individuals in 5, 10 and 15 years?
  • In order, what are the five things you value most in life?
  • How should we behave toward each other?
  • How should we take care of relatives who are or become sick or disabled?
  • How should we resolve our disputes?
  • How important is the family business to you?
  • What should we be doing differently with our family money as well as our assets inside the business?
  • What professionals or structures should we bring in to help us manage our wealth?
  • What’s the best way for us to be building our wealth?
  • What do you think the role of our family should be in helping the community?
  • What should we be doing individually and as a family with regard to philanthropy?

Structurally, the written mission statement can be whatever you agree it should be – most experts say it should be no more than a paragraph long, but that’s a guideline, not a rule. It is also very important to focus on the positive, meaning what you want to accomplish and achieve as a family, as opposed to want you want to avoid. And it needn’t be set in stone – a family should have a meeting every year or two to revise or approve its mission.  The family mission statement helps a family establish its identity and the variety of voices within, and those voices may be subject to change over time. The family mission statement is a living, breathing document that can evolve over time. In today’s fast paced world, it is easy to get caught up in the here and now, a family mission statement can help you stay true to your family’s values. As a result, families may not feel the pressure to keep up with the Joneses because their mission  statement helps achieve balance. It is also very important to focus on the positive, meaning what we want to accomplish and achieve as a family, as opposed to want we want to avoid.

The right mission statement can help reset goals and diffuse tensions later. It can also be used to moderate discussions that inevitably happen after major changes within the family – death, divorce or happily, an increase in the number of heirs and participants.

As for the age of the participants, it can start in very basic form with younger children and the process can mature as they age. It’s actually a good idea to bring young members into a customized version of the process for youngsters so they can comfortably adjust to working as adults with the older members of the family.

For additional resources on how to create a family mission statement, please consider utilizing any of these websites

http://www.nightingale.com/mission_select.aspx?from=homepage&element=missiontitle

http://www.ehow.com/how_2043790_write-family-mission-statement.html

http://www.franklincovey.com/msb/

June 2010 — This column is produced by the Financial Planning Association, the membership organization for the financial planning community, and is provided by Ronald J. VanSurksum, a local member of FPA.

Why Should I Care About Estate Planning?

June 3, 2010 /

Having figured out what estate planning “is” in my previous post, let’s move on to why estate planning is important.  Because the topic is so broad, I’m going to break it down and address it based on common life stages.  If you are curious how it applies to YOU, contact me and let’s talk about it.

Let’s start by looking at how critically important estate planning is for parents with kids under 18 years old.  It really doesn’t matter if all or some of your children are under 18.  These important issues apply if any of them is under 18:

  • Establish guardianship for your children under 18 – not doing so will leave their care up to a court to decide.  Someone who doesn’t know you and what’s important to you, your family dynamics, and your desires for your children’s future, will be the one making the decision who will raise them.
  • Establish temporary guardianship for your children – not doing so could leave them in the hands of child protective services or temporary/permanent foster care.
  • Make sure you have a comprehensive protection plan for your children so your babysitter, family, friends and guardians/temporary guardians know what to do if something happens to you and have the legal documentation to prove it.  We include instructions for these important people and even include a family emergency ID card for your wallet/purse.
  • Have your estate structured so your kids don’t succumb to “lottery winner syndrome” when they receive all of their inheritance outright at 18 years old.  Think about that for a second.  Let’s take an example: 2 children and an estate valued at $500,000 (and remember life insurance is included in the amount they receive).   Each child will receive whatever amount of their $250,000 share is not used up by the time they are 18.  Can you imagine?  Let’s say that ends up being $100,000.  How would you have handled $100,000 when you were 18?  I know how I would have handled it and it’s not pretty.  I read one study that said over half of outright inheritances are spent within 3 years of receiving them – no matter how much was received.
  • If you are a professional and subject to potential liability, make sure you structure your plan in a way that ensures your assets are there to benefit your kids and not lost to lawsuits, creditors and other liabilities.
  • Make sure you pass on your “whole family wealth,” not just your money.  This includes your values, insights, stories and experiences – who you are and what is important to you.  In my experience this is THE most overlooked part of estate planning.  It happens to be one of the most fulfilling privileges I have when working with families.
  • Have a health care directive (patient advocate designation) in place for yourself and your children to minimize conflict about your medical care.

These are just a few of the reasons families with kids under 18 need an estate plan.  Can you think of more?  Please share your thoughts and experiences.

With my next post in the series, I will look at why planning is vital for “professionals” – and you may be surprised how many families are in that group.

Michael Lichterman is an attorney specializing in estate planning and helping provide peace of mind to families and businesses in Grand Rapids, Grandville, Cascade, Forest Hills, Ada, Byron Center, Caledonia, and the surrounding areas.  He specializes in “whole family wealth” planning for professionals with minor children, doctors, nurses, lawyers, and the “sandwich generation” (caring for parents and children) – and does so from a Christian perspective.  He takes the “counselor” part of attorney and counselor at law very seriously, and enjoys creating life long relationships with his clients – many of which have become great friends.

Michael Lichterman is an attorney specializing in estate planning and helping provide peace of mind to families and businesses in Grand Rapids, Grandville, Cascade, Forest Hills, Ada, Byron Center, Caledonia, and the surrounding areas.  He specializes in “whole family wealth” planning for professionals with minor children, doctors, nurses, lawyers, and the “sandwich generation” (caring for parents and children) – and does so from a Christian perspective.  He takes the “counselor” part of attorney and counselor at law very seriously, and enjoys creating life long relationships with his clients – many of which have become great friends.

What Is Estate Planning?

May 31, 2010 /

Based on some recent conversations, it has become clear to me that there is much confusion about estate planning.  What is it?  What does it mean?  Why do it?  How to do it?  Why work with an attorney?  And many more questions I hear on a regular basis.  So, I’ll be doing a series of blog posts introducing estate planning and its various components.  I don’t know how many posts it will be.   I’m pulling many of the topics from my day-to-day conversations, so I’ll keep the series going as long as there are questions.  If you have questions, please ask! I’ll make sure to work your questions into this series.

So, the first question – what is estate planning?  Wikipedia defines estate planning as “the process of anticipating and arranging for the disposal of an estate.”  I believe a much better definition is one I heard from a colleague of mine from Wealth Counsel:

“I want to control my property while I’m alive, take care of me and my loved ones if I become disabled, and give what I have, to whom I want, the way I want, and when I want.  Furthermore, if I can, I want to save every last tax dollar, professional fee, and court cost legally possible.”

The one item I always add to that definition is: “to make sure that my children are cared for by who I want, in the way I want.”  Of course, this applies only to parents who have minor and/or disabled children.

So here we have the definition, the starting point.  Within the definition are many more considerations.  To accomplish these goals of estate planning, the following documents are commonly used: wills, trusts, general durable power of attorney, and health care powers of attorney/patient advocate designation.  And if you work with a comprehensive Grand Rapids estate planning attorney, there are additional considerations and documents meant to help you pass on your “whole family wealth” – not just what you own, but who you are and what’s important to you!  Because if you think about it, the money and the “stuff” will still be around when you pass away, but it is who you are as a person that will be lost – your values, insights, stories and experiences.  Check back for the next installment in this series to discover some additional considerations that are vital to having a great estate plan for your family.

Michael Lichterman is a dedicated estate planning attorney helping provide peace of mind to families and businesses in Grand Rapids, Grandville, Cascade, Forest Hills, Ada, Byron Center, Caledonia, and the surrounding areas.  He specializes in the needs of professionals with minor children, doctors, nurses, and those in the “sandwich generation” (caring for parents and children), and does so from a Christian perspective.  He takes the “counselor” part of attorney and counselor at law very seriously, and enjoys creating life long relationships with his clients – many of which have become great friends.