Tag: wyoming mi trusts

What is a Michigan Estate?

June 26, 2011 /

As a Grand Rapids, Michigan estate planning attorney, I field all sorts of calls and conversations about estate planning and probate. I also receive calls and questions about areas of law outside my practice area and I am happy to refer those folks to colleagues I trust explicitly to handle the matter well.  I had just such a call this past week.  Why, you may ask, would I use that story to start a post about having a Michigan estate?  Well, as we were wrapping up the call the nice lady said “I really like you and you can be sure that I will call you for estate planning if I ever have an estate.”

I have news for her and everyone else . . . we ALL have estates.  Sure, some are bigger and some are smaller . . . it is not necessarily the vision we may conjure up of rolling green hills with a stately colonial mansion set atop a hill with horses grazing in a field nearby.  Although that sounds nice!  So that begs the question – what is an “estate” for probate and estate planning purposes?

There are actually two “estates” that matter in this context – (1) your Michigan probate estate, and (2) your federal estate tax estate.  In this post I will tackle the first one.

First, make sure you understand what probate is and the context(s) in which you may find yourself (or your loved ones) dealing with it.  If you are unsure, you can read my post on it by clicking here.

So, what makes up a probate estate?  I would start by considering the value of everything you own.  Oh yeah, do not deduct any debt owed on what you own.  That’s right – no deduction.  Why is that?  Because according to Michigan law, the value of assets that must be reported to the probate court is the “fair market value.”  Yes, you can list any “encumbrance” (close to “debt,” but technically not the same), but as far as the inventory fee with the probate court, such “encumbrance” will not be deducted.

Ok, so you’ve added everything up.  Is it a bigger number than you thought?  For most people it is.  Now, you will be happy to know that several common ways of owning assets will keep them out of your probate estate.  If you have any of the following, it will not be part of your probate estate:

  • Jointly owned property (bank accounts and marital homes are the most common in this category).  Note: this only works as long as there is more than 1 joint owner . . . because if there isn’t, it is no longer jointly owned.
  • Beneficiary designated assets – IF the person designated is still alive and is at least 18 years old (retirement accounts and life insurance are the most common in this category)
  • Assets owned by a trust.  Note: just having a trust is not enough . . . it must own the property (you can read more about that in my previous posts by clicking here and here)

So there you have it.  The basics of a Michigan probate estate.  Keep in mind, this is just a basic overview.  It is more complex when you “dig down into it,” which is why I recommend meeting with an attorney who really focuses on estate planning so you can fully understand your specific situation.

Stay tuned as next time I will share what makes up your federal estate tax estate.  That one is not one you want to miss . . . I guarantee you will discover some BIG surprises in that one.  And if you’re ready to make sure that your “estate” is taken care of and that it is done in a way that is unique to who you are, then call us at 616-827-7596 to schedule your Peace of Mind Planning Session.

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.

A Creative Idea for “Supercharging” Your IRA – Part 2

June 12, 2011 /

Ok, so you read my previous post about the incredible legacy you can create by “Supercharging” your IRA.  The logical questions are: what are the drawbacks to the “traditional” approach to IRA beneficiary planning and how do I do the “supercharged” strategy?  Well, I’m glad you asked.  That is what this post is about.

So, how is IRA beneficiary planning typically done and what are the drawbacks?  Usually, a married couple will name each other as the beneficiary of their IRAs.  This is done for many reasons, two of the most common being love and the additional “rollover” options provided to a surviving spouse by the tax code.  Yet, there is a problem . . . spouses are usually near the same age.  That means when the first spouse dies, the “stretch” tax deferral period of the deceased’s spouse’s IRA will typically be rather short.  This goes against the goal of many IRA holders’ desire to maximize the “stretch” period to take full advantage of the tax-deferred growth of their IRA after their passing.

One option is to name a person from a younger generation as the beneficiary of the IRA.  There’s a problem with that too . . . the surviving spouse is left out of enjoying the “fruits of labor” from the IRA.  The “Supercharged IRA” strategy mentioned above is the way to have your cake and eat it too.

In this strategy, a younger person is named as the beneficiary of the IRA.  Or better yet, an IRA Legacy Trust for the benefit of younger people is named so that you can not only maximize the “stretch” tax-deferral period but also make sure the IRA proceeds are asset protected for future generations (from creditors, predators, divorce and poor spending habits).  As mentioned in my previous post, the required minimum distributions from the IRA are used to purchase a permanent life insurance policy on the life of the IRA holder with the spouse named as the primary beneficiary (or better yet, an Irrevocable Life Insurance Trust purchases and holds the policy so that it is asset protected from the insured’s creditors, predators and potential divorce).

What is accomplished?  The IRA tax-deferral stretch is much greater because a younger person is beneficiary and the surviving spouse doesn’t miss the IRA benefits because he or she receives the insurance proceeds, which can be much greater than the IRA due to leveraging the life insurance premium.  An additional benefit of this strategy is that it can be used for non-traditional couples and single individuals.

Make sure to discuss this strategy with a financial adviser, life insurance agent and estate planning attorney who are familiar with it and accustom to the mechanics of implementing it in your situation.

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.

The Biggest Misconception About Trusts

April 24, 2011 /

Last week I wrote a post about the biggest misconception about wills.  The same recent conversation that I mentioned in that post also reminded me of what I believe is THE biggest misconception about Trusts.  Remember what my friend said?  “So I have my will or trust, so I don’t have to worry about going through probate…”

The Myth: having a trust means that you don’t go through probate.  And the buzzer says “bzzzzt,” wrong.  You may be thinking, “what?!  Mike, you are off your rocker.  That’s why I have a trust . . . to avoid probate!”  Just *having* a trust does not bypass the probate process.  To bypass probate, the trust must be “fully funded.”  “Funding” a trust is the process of changing ownership or beneficiaries of an asset to the trust.  I still have not had a trust come through my office for a review that was fully funded.  Yes, you read that right.  I know they’re out there, but I have yet to have one come in for review!  Not exactly what you thought when you started creating your legacy, huh?  If you’re curious to know more, you can read my blog post on the topic by clicking here.

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.

5 Priceless Presents You Should Give Your Family

December 22, 2010 /

A recently read a great blog post by my colleague and Oregon estate planning lawyer, Candice Aiston. I am re-posting it hear for my readers, with Ms. Aiston’s permission.   Please take the time to read it, as it could make a HUGE difference in your families future.  Make it a point to give these important gifts in 2011.  You never know what could happen to you, and delaying these gifts could be disaster.

The end of the year is a time when I think a lot about the state of my life, family, and career.  I like to reflect on how the year went, whether goals were accomplished, what my goals are for the coming year, and how those goals match up with my values.  I try to think about what my overall purpose is and realign with that.  It is so easy to get caught up in the small details in life, that sometimes the big picture is lost.  I like to reassess each year and make sure I am always keeping my eye on what is important.

This year as I reflect, I find that my life, family, and career goals are really very interwined.  My family goal is to be a loving and responsible parent, and it turns out that my career goal is to help loving and responsible parents as well.  My life’s work happens to be helping loving parents to create estate plans that protect their families if something tragic happens.  Estate Planning is part of being a loving and responsible parent, but it is just one piece of that bigger goal.

If you are reading this, you probably feel similarly to the way that I do about parenting.  It is serious business, and it is our responsibility to provide the best care possible for our kids and to make sure they are protected and that they have every opportunity to succeed in life.  If we can toast to that, I want to share with you 5 Priceless Presents that you should give to your family.  If you have not given these to your family yet, there is no time like the New Year to get started.  Make it a resolution, a Responsible Parent’s Manifesto, if you want to call it that.

1. A Comprehensive Estate Plan
A Comprehensive Estate Plan is the first thing that any parent needs to get in place.  Why is this first?  Because you can have all of the things listed below, but put your family through hell trying to access it and pay all of the fees and taxes associated with your death or incapacity if something happens to you.  Without meeting with an attorney and discussing your particular situation, you have no idea what type of situation your family faces if something happens.  You need a plan that dictates the care of your kids (both short and long-term) and the handling of your assets in a way that saves your family the most time, money, and heartbreak. So, if you are a parent without an estate plan, this is your first step.  Call an estate planning attorney today.

2. Life Insurance
Life insurance is an essential part of most parents’ estate plans.  Most parents do not have enough in savings or assets to allow their families to live a similar lifestyle if a parent died.  Life insurance replaces lost income and it can be used to pay for childcare.  If you do not have life insurance, make it a priority in 2011 to get insured.  The longer you wait, the more difficult and expensive getting life insurance will be.  Keep in mind that life insurance makes your estate worth more, so you should consult your estate planning attorney before buying it.

3. An Emergency Savings Account
Every parent should have an emergency savings account.  This economy has taught us that little is certain in life.  It is not certain that you will have your job next month.  It is not certain that your business will be around next month.  It is not certain that your health will be good next month.  It is extremely important to plan for a situation where you may not have income for 6-12 months.  Otherwise, you could lose everything you have worked so hard to gain.  People who lose their jobs and do not have emergency savings often have to cash in retirement accounts with severe penalties and have their homes foreclosed upon.  It really can pay to sacrifice in the short-term to have that security long-term.

4. A Plan for Retirement
Retirement takes decades to plan for, and many parents do not know what they are doing when it comes to saving for it.  Seeing an experienced financial advisor is such a good idea when it comes to retirement.  Retirement is the biggest event for which you will ever plan.  An advisor can project what you should be putting aside based on your income, expenses, projected age of retirement, and rate of inflation.  They can also describe to you the various types of accounts and how each type can benefit you.  They all involve different tax rules and have different rules for distribution.  Your company’s retirement plan or pension may not be enough to support you during retirement.

5. A Plan for College
You would think that planning for college would be at the top of this list if you are a loving parent, right?  Wrong.  You first take the steps to protect your family from the worst situations, then you plan for the time when you can no longer work, and then you plan for college.  The reason for this is that if there is no college fund, your child can apply for loans and grants and get a job during college.  It is not ideal, but it is a heck of a lot more ideal than your grown child having to support you in your old age because you do not have the means to support yourself.  It is a lot more ideal than your child flunking out of high school because when dad died without life insurance, mom had to get two jobs to make ends meet and there was no one to make sure the child was doing what he was supposed to be doing.  But once you have taken care of the other things, providing a college education for your child can help your family for generations.  Without having to pay back student loans, your child can start saving, planning, and living prosperously a lot earlier on than you were able to do so.

Candice N. Aiston is an Estate Planning Attorney for families in the Portland, Oregon area.  She helps loving parents to prepare their families for a lifetime of security, prosperity, and guidance.  If you would like to receive her free report, “The 9 Common Planning Mistakes Parents Make,” please visit http://candiceaistonlaw.com/.

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.

“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.

Asset Protection Planning for Physicians

July 18, 2010 /

Growing up with a mom who has worked in the medical field for over 35 years, I know of the sacrifice and struggle that Michigan physicians face on a constant basis.  They are constantly targets of malpractice lawsuits as well as other legal actions such as employee lawsuits for sexual harassment, unfair termination and discrimination; and business and practice-related litigation.  And it seems that Physicians are targeted for every ill-conceived investment idea.  Yet they sacrifice their time and expertise to help care for others.  It is truly a noble profession.

Do they deserve to be in these cross hairs?  I sure don’t think so.  That’s why I’ve been working on better serving physicians and their families.  Contrary to what many believe, asset protection planning is not all about offshore trusts and Swiss bank accounts.  It is about adopting advanced planning strategies that legally place assets beyond the reach of creditors, discouraging lawsuits by lowering a physician’s financial profile so that they become a far less attractive target, and enhancing leverage in negotiations if a lawsuit is filed.

Know that although asset protection planning is confidential, it is NOT based on secrecy or fraudulent transfers, does NOT involved hiding assets and is NOT a tax dodge.  Professional and personal convictions don’t allow such unethical (and potentially illegal) methods.

It is important for Michigan physicians to work with an estate planning attorney who is both well versed in these advanced planning strategies AND can understand the threats Michigan Physicians face and the constantly changing environment in which they work.  Are you a Phyisican or do you know a Physician?  Please share your thoughts.

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.

Why You Should Care About Estate Planning: Professionals

June 13, 2010 /

Moving along in my Intro to Estate Planning series, we will continue to look at why planning is important for  family of different types and at different life stages.  I started by uncovering the many benefits estate planning holds for parents with children under 18.  If you are a parent with children under 18 years old and still have questions, contact me to have your questions answered.

The next group we’ll look at is more of a “type” of family rather than a stage of life: professionals.  My definition of a “professional” is broad, including doctors, lawyers, certified public accountants (CPAs), accountants, bankers, financial advisers, nurses, teachers, middle- to high-level company managers, CEOs, company Presidents, and other similar positions.  I view this group so broadly because they all share similar concerns, at varying degrees.

Some important reasons proper estate planning is critical for professionals (and their families) include:

  • Guardianship remains one of the most important reasons to estate plan if you have children under 18 years old.  Without designating who you want to raise your children in your absence, a court will decide who will care for them. If you haven’t named guardians for your children, you should run, not walk to an attorney specializing in estate planning (and focusing on guardianship decision).  If you have named guardians, you most likely made at least 1 of 6 common mistakes.  Contact me to learn more!
  • Asset Protection. As a professional with a special skill, you face a greater threat of liability.  You have worked hard to accomplish great things and are building a secure financial future for your family.  Don’t leave it exposed to future divorce, lawsuits and creditors.  And this pertains as much to you as it does to your children and grandchildren (and on down the line).  You can pass your financial wealth on to them protected from divorce, lawsuit and creditors as well.
  • Planning for your incapacity to avoid bitter conflict about your finances and your health care. You need to give people you trust the legal authority, guidance and direction on how to handle your finances and your health care.  Enhanced Powers of Attorney, EnhancedPatient Advocate Designations, and Living Trusts are key components to making sure your wishes are recognized and followed.
  • Avoiding probate.  Without a proper plan in place, your hard earned wealth will go through a time consuming and often costly court process. Wouldn’t you rather your family be able to benefit right away and receive more of what you worked so hard to accomplish?
  • Passing 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.  The professionals I’ve worked with have accomplished a lot and continue to reach new levels of accomplishment.  Yet in most circumstances they have not taken the time to explain their struggles, how they overcame, and what they learned – these are far more important than money to their kids, grandkids, and future generations.

These are just a few of the reasons professionals 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 the “sandwich generation” – people who have concerns about their parents and their children.

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.

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.

Online Wills and Trusts Company Gets Slapped With Class Action Lawsuit

June 7, 2010 /

Pardon the interruption of our regularly scheduled “introduction to estate planning” programming for this breaking news.  I figured it was bound to happen sooner or later and now we know . . . sooner.  According to this article, Legal Zoom recently became the subject of a class action lawsuit.  The suit accuses Legal Zoom of “unfair and deceptive” business practices.  The suit alleges the deception is in Legal Zoom’s claim that “‘. . . virtually anyone'” can create a valid legal document through the site and that the ‘customized’ documents made by nonlawyers would be reviewed for ‘accuracy and reliability,’ [giving] customers a false sense of security.”  What happened in the specific situation that brought about the lawsuit?  They bought a revocable living trust, a will and a durable power of attorney that later had to be fixed by an attorney.  My colleague Candice Aiston wrote about it here.  And to be fair, you can read Legal Zoom’s response to Candice’s post here.  It’s always best to hear both sides of the story so you can form your own opinion.

I’m not making any comment about the validity of the lawsuit, or lack thereof.  However, if you’ve been reading my posts for any period of time you know that I believe online- and software-based will-making software leaves many people with a false sense of security.  The sad part is that most people don’t find out that the security is false until they die, and then it is too late! Their family is left cleaning up the mess.  Think about a child’s toy.  They come with specific pieces that are designed to fit together a certain way and their are directions telling you how to construct it.  Yet somehow, I still find a way to put it together wrong (causing untold frustration) or never getting it put together at all!  What about you?  Think about how unique each individual is . . . and each family.

An estate plan is not a cookie cutter situation and you should run (not walk) away from anyone (lawyers included) who tell you it is.  Each person, each family, is like a snowflake – unique in who they are and in the legacy they want to create and pass along to their family after they’re gone.  And that is just one of the reasons working with an attorney who specializes in estate planning is key to making sure you pass along your “whole family wealth,” and not just a set of documents that distributes your “stuff.”  Call me if you’re interested in learning more about sharing who you are and what’s important to you – making sure your values, insights, stories and experiences will benefit your family for generations to come.  It’s about far more than money.

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 the needs of professionals with minor children, doctors, lawyers,  CPAs, 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.