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Right on the Money with Steve Savant

End-of-Life Planning Can Empower You to Dictate from the Grave (Part 1)

Dispersing Your Assets As You See Fit and to Whom You Want
Published on May 9, 2016

Most Americans have lived a life of self-determination in their pursuit of happiness. They’ve imposed their will in everyday decisions. So it’s a cultural curiosity most Americans live without a will or the protection of their assets through the use of trusts. The fact is, without a written will or trust document, someone else will control your assets, child guardianship and health directives.

End-of-life planning is an issue of asserting your will and controlling the dispersion of your assets in the most economical way possible. Handing it over to the decision-making process of the state or the court—where the intervention of professionals, who are strangers in control the disposition of your assets, child custody of minors or health care directives if you’re incapacitated—is a frightening prospect. Watch the interview with estate planning attorney Elizabeth Westby on the importance of end-of-life planning.

Dying without a will and asset trust protection can inadvertently hurt relationships between family and friends. It can eliminate ongoing gifts and contributions to charities you desire to go into perpetuity. It can leave the state with the awesome power of heath directives in case of incapacitation.

With a well-laid plan, you can dictate from the grave your desires and secure confidence knowing you’ve anticipated the vast majority of end-of-life items and avoided most of the contested issues that plague those without a will and trust documents.

End-of-life planning sends a set of expectations to beneficiaries that asset distribution and child guardianship has been predetermined. It takes away the often-painful decision-making process of health care conversations about ending life with dignity.

The baby boomers have been called the sandwich generation as they oversee the care for their parents and the college tuition for their children, and sometimes act as guardians for their grandchildren. Many boomers have sacrificed their own retirement stability by funding the preceding and succeeding generations. Most of them do not have a retirement strategy and even more do not have an end-of-life plan that maps out the transfer of their assets to their beneficiaries.

Even financial advisors, who quarterback their clients’ finances, are now teaming up with estate planning attorneys to address the proper transfer of assets and health directives. Assembling a team of professionals is the first step in taking responsibility and control of your future as well as the future of your family, friends and charities.

Syndicated financial columnist Steve Savant interviews estate-planning attorney Elizabeth Westby on the basics of estate planning, creating a will and installing appropriate trusts. Right on the Money is a weekly financial talk show for consumers, distributed as video press releases to 280 media outlets nationwide.

Do Nothing and the State Controls Everything (Part 2)

Your Beneficiaries Go through the Meat Grinder during Probate
Published on May 9, 2016

Probate is the court process of administering a deceased person’s estate. While it has become a more simplified process since some states have adopted the Uniform Probate Code, it is still to be avoided—avoided like the plague.

Probate is a court process and a matter of public record. Public record means anyone has access to some of the most private information about your family and assets. This is how creditors find the information they need to collect from estates. When you hear about families being left with nothing but debt, that is what they mean.

Additionally, when an estate is probated, there are costs. Fees spent on the attorney who will help settle the estate and fees spent on getting things in order. All of these come as out-of-pocket expenses that often times are reimbursed out of the estate when everything is said and done, but there is no guarantee.

Lastly, the probate process takes a lot of time. Depending on the size of the estate and how much conflict is involved, a probate can take anywhere from six months to years. During this time, the family is unable to completely mourn the death of their loved one and continued family conflict is almost certain. Watch the interview with estate planning attorney Elizabeth Westby on the seriousness of going through state probate.

The person who will be handling the settling of your estate is called a personal representative. This position holds a high fiduciary standard. If you die without a will, the personal representative could be anyone who comes forward and designates himself or herself. Choosing this person carefully is important and can be done through an estate plan. You want to make sure this person knows your wishes, is trustworthy, good with money, organized, accountable and has practical business sense as well as life experience. This is the person who will take inventory of all of your personal property and all of your monetary assets. This is the person who will be responsible for making decisions that will affect the estate as a whole and your loved ones. This is also the person who will divide your estate according to your will, or if you die without a will, according to the intestate laws of the state you died in.

The good news is that probate is 100 percent avoidable. With proper planning and a little time and money spent now, you will save thousands later.

Many Life Events, But Only One Death Episode, Plan Accordingly (Part 3)

If You Have Assets, Dependents and Charitable Intent, You Need a Plan
Published on Jun 14, 2016

While it is never too early to have a plan drafted, life events can often be the impetus that trigger either drafting a plan or having the plan in place reviewed and updated. There are so many life events that can alter an existing plan that it’s recommended to have at least an annual review. Some other life events may need to be acted upon immediately.

In community property states like Arizona, remarrying can have unwanted effects on your plan. If two people are married after already having children and their own plans drafted, the community property laws assume you did not mean to disinherit your spouse. That could mean half of your estate would go to your spouse instead of to your children as planned in your will. Unless your new spouse is kind enough to forego their portion of the estate or you had a prenuptial agreement in place, he or she will take half. The only way to cure this defect is to have your plan revised after you are married. You can specifically state you intend to leave all of your assets to your children, instead of your spouse. By showing a clear intent you can protect your children and your assets. This is important as well when adult children marry. What happens when your “in laws” become “out laws”? Having a pre-nup—even a post-nup—can avoid nasty arbitration and court showdowns.

The Power of Control in Wills and Trust Documents (Part 4)

Documenting Your Wishes for Generations to Come
Published on Jun 14, 2016

One of the largest differences between a will and a trust is a trust must be funded in order to work. Funding the trust is the process of transferring your assets into the name of the trust so the trust becomes the owner. This is how all of your assets are pooled together for easy administration. Without funding, the trust cannot work effectively.

In basic terms, a will speaks upon death, meaning you have to wait until you die to benefit from the document. A trust is a living, breathing, flexible document that can help you during your lifetime and last for years after you have passed.

Everyone Dies, but Not Everyone Has a Living Will (Part 5)

The Consequences of Having No Will Can Destroy Family and Friendships
Published on Jun 14, 2016

The horror stories of unintended consequences fill the files of many county courthouses. There are testaments to indifference and sorrows of inadvertent ramifications of indecision. Here are three stories of heartbreak and family devastation due to the lack of planning. Watch the interview with estate planning attorney Elizabeth Westby, who talks about the ramifications of dying without a will for surviving beneficiaries.

A Stepchild’s Story: A client recently came to her attorney asking what she could do to protect the estate of her stepmother who had recently passed away. Her stepmother had raised her and been her mom for more than 40 years. In turn, the client had cared for her mother during the last 10 years of her life when she was very ill.

Steve Savant’s Money, the Name of the Game

The Myths About Handling Estate Assets (Part 1)

Separating Fact from Fiction Can Save You Heartache and Money
Published on Mar 5, 2017

The myths the public maintains on estate planning, the protection of assets and ownership is frequently far from reality. Most people discover these myths after the mishandling of transferred assets or a lawsuit. Then it’s too late, too costly and often quite hurtful to family members and business associates. Watch the interview with estate attorney Elizabeth Westby.

Here’s a myth: If I pass without a proper estate plan, the state will take my money. Estate attorney Elizabeth Westby says, “This is untrue, although you should have a proper estate plan, so your wishes are adhered to, if you do not the state will create one for you.” This is called dying intestate, or without a will or trust. This means the laws of the state determine who takes “per stirpes.”

As an example, in Arizona first position is your spouse, then your children. If there are no children then it goes back up to your parents, then siblings, etc. The only time your assets will escheat, or go to the state, is if there is no one in line to take them. While this is exceedingly rare, it can and has happened.

Here’s another myth: I have an LLC, so I am protected. Assuming the LLC was formed properly by filing the Articles of Organization with the corporation commission, which most times it is not when people do this themselves, having an LLC doesn’t necessarily do what it is intended to do. An LLC stands for Limited Liability Company and it is supposed to be able to limit your personal liability. But it can only operate properly if all the formalities are adhered to. Most folks think they can create an LLC online themselves, forget the meeting minutes, property articles of organization and bylaws, and just begin operating. The problem here is only if you adhere to all of the formalities under a properly formed LLC can you show or demonstrate that you have a distinct and separate entity from yourself. That is why we have clear bank accounts for the business and take proper payroll and record the right documents, have current and professionally prepared taxes.

Here’s another myth: The quitclaim deed is my friend when transferring property. It can be, but the quitclaim deed can also create huge issues for people in the future. This is such a common practice too, especially for people who want to keep a piece of property in their family for generations. The problem is the title can be clouded (liens, identity affidavits, etc.) and no one may be aware of this for decades until someone tries to get a mortgage or a loan and they cannot get the title commitment (insurance policy for the title) because there isn’t marketable title. These are just a few of the estate myths among consumers that can be costly and cause family dissension for generations. Elizabeth Westby, J.D. contributed to this press release.

Syndicated financial columnist Steve Savant interviews estate-planning attorney Elizabeth Westby. Steve Savant’s Money, the Name of the Game is an hour-long financial talk show for consumers distributed online in 5 ten-minute video press releases Monday through Friday to 280 media outlets, social media networks and industry portals.

Senior Financial Abuse (Part 2)

Thieves Capitalize on Friendship, Dementia and Threats
Published on Mar 5, 2017

Senior financial abuse can threaten a retiree’s golden years like no other event. Betrayal by friends and family in the realm of money can also rob a senior of their will to live. Scammers prey upon seniors with threats that cause them to empty their bank accounts to complete strangers in fear. Watch the interview with estate attorney Elizabeth Westby.

Senior financial abuse scams are a multi-billion dollar industry. This type of abuse not only effects seniors, but their families, financial institutions, taxpayers and all the services that provide relief to the victims. MetLife Mature Market Institute did a study in 2011 that estimated that the annual financial loss from senior financial abuse was 2.9 billion dollars! That number was based solely on the cases that made it to the media.

Seniors are especially susceptible to fraud. This is because we tend to be more trusting as we age, we have more wealth accumulated by that time in our lives, and our worlds become smaller. Generally, seniors do not have contact with a wide variety of people and become secluded from the outside world. While this is a natural process that comes with age, it also provides opportunity for those who mean to cause us harm. All seniors are at risk for being targeted, but women account for the majority of these types of crimes. I am not convinced this will always be the trend but for now it is. That is due to the fact that women live longer than men, leaving them alone when their spouse passes; and elderly women in 2017 are from a generation where they are used to relying upon others in their lives to help them make important decisions.

Financial abuse comes in a variety of forms, but there are certain forms that present themselves over and over again and have become very commonplace. Some of the top senior financial abuse issues include: Identity Theft and Credit Card Fraud, Power of Attorney Abuse, Reverse Mortgage Scams, Living Trust and Annuities Scams, Deed Theft and Foreclosure Rescue Scam, Undue Influence and Healthcare Scams.

The perpetrators are not so easy to spot. They come dressed as your family member, a friend or neighbor, and someone working in a professional atmosphere with ready-made deals, and ideas on how to invest money. When anyone approaches an elderly person regarding: reviewing an estate plan, reverse mortgages, annuities, or any other product that would effect the individual’s financial portfolio – beware! If something needs to be changed, either a trusted advisor who you have been working with for years will bring it to your attention during the course of a regular review or you will be the one reaching out to the professional – not the other way around. As a rule of thumb, if someone calls you, walk away. That includes your family members. If the family is urging you to do something, get at least three professional opinions before making any decisions. Unfortunately we cannot simply trust blindly anymore; but rather, ought to be cautious – especially as we age.

The only real way to help prevent this type of abuse is to have a revocable living trust created, one that is very thorough regarding your wishes. That is what is so beautiful about creating your plan; you have control throughout every stage of your life. It is critical that this process is done properly; otherwise you won’t be doing yourself any favors in the future. Elizabeth Westby, J.D. contributed to this press release.

Choosing Your Advocate Wisely (Part 3)

Vetting An Attorney As Your Advocate is No Small Matter
Published on Mar 5, 2017

The trust mills manufacture paperwork intended to bring you peace of mind, but in fact, create more headaches in the proper disbursement of your assets. Turnkey estate planning packages featuring wills and trusts are promoted on the web as a way to save money by doing it yourself, but they save you little in the long run. Watch the interview with estate attorney Elizabeth Westby.

The term professional is a non-descript adjective that is too generic to qualify as a potential advocate for the disposition of your assets, health directives, and child guardianship. Even some attorneys, who have general practices, may not qualify as an estate planner.

Vetting an attorney is more than stalking their LinkedIn bio, checking out the local community’s business accreditation and confirming good standing with the Bar. You need third party references from friends and business associates that have a track record of dependable recommendations to add to your online search. Choosing an attorney is selecting the financial steward of the family, a most trusted member of the family. In the Godfather, Tom Hagen is the “consigliere”, an adopted son with the Corleone family. He is the family counselor and confidant. His fiduciary responsibility can’t be underscored enough. He is deeply knowledgeable about personal family matters. He represents the family in the public domain both in legal matters and sometimes financial matters as well.

In today’s world the estate attorney may be evolving into this old world idea of family fiduciary, the quarterback of the family’s team. He has subordinate team members such as financial advisers, insurance professionals, real estate brokers, bank trust officers and CPAs. His role is to coordinate this team on behalf of the family’s interests while maintaining no conflicts of interest with the family.

You need to perform a due diligence vetting process that narrows the field down to three attorneys. Usually by this time in the process, you’ve established their professional resumes with quality references. Going forward with the vetting process may have more to do with the relationship than scholarship. In one instance, a personal friend was performing an interview with an attorney when during the conversation specific information about a well-known family in the community was introduced as an example. But my friend interpreted this information as a violation of trust and eliminated the attorney from their consideration. He said to me, “loose lips sink ships,” an old Navy saying on talking about military movements in public. Choosing an advocate wisely is like adopting someone into the family. Elizabeth Westby, J.D. contributed to this press release.

Don’t Rely on Someone’s Opinion (Part 4)

Family, Friends and the Internet are not Substantial Legal Authority
Published on Mar 5, 2017

Caveat emptor is Latin legalese for “let the buyer beware”. Sometimes the Internet is viewed as the fount of all knowledge. Consumers troll online for entertainment and education, but let the reader beware. The World Wide Web is full of misleading information, critical omissions and the content of artful wordsmiths penning fables and fiction that are held out as truth. Watch the interview with estate attorney Elizabeth Westby.

First rule of thumb: Business is business. Verbal agreements that can’t be substantiated are worthless. It seems to always disintegrate into he said, she said. Documenting transactions, identifying expectations of both parties and using paper trail exchanges can save you from arbitration, going to court and destroying relationships, especially among family and friends.

Consider this real life horror story regarding not paying attention to the docs you’re signing. Enter into the story: a woman in her early 60’s is working two jobs, supporting her disabled daughter and another daughter who has a child with her boyfriend. The boyfriend’s sister was living there, but had moved out. All of them lived together in a home that the woman had been paying the mortgage on for years.

The boyfriend decided to get a new girlfriend and move out. Then, out of nowhere, the boyfriend’s sister decided she wanted the house. The woman and her daughters believed she had signed a lease agreement with an option to purchase. The woman thought she recalled three names on the deed, one of them being her own.

A title company search revealed that there was only one name on the deed. And it wasn’t hers; it was, in fact, the ex-boyfriend’s sister’s name.

All these years she was the one working and paying for the home, doing so because she believed that she was buying the home and now it appeared she was just renting the home and would be evicted. This could have been avoided if she had taken the documents to an attorney and had them reviewed before signing. But because she relied on what the boyfriend and his sister were telling her, she lost everything. Elizabeth Westby, J.D. contributed to this press release.

Sole & Separate Property (Part 5)

Protect Your Assets with Prenuptials and Sole & Separate Property
Published on Mar 5, 2017

A seismic societal shift has occurred in the American Family where Millennials delay marriage, accumulate assets and experience divorce. Prenuptials and owning sole and separate property is a new trend mimicking the culture changes. Watch the interview with estate attorney Elizabeth Westby.

The average age of the person divorcing in the US right now is age 50. Surprisingly, estate attorney Elizabeth Westby says, “I cannot tell you how many dissolutions I have right now where the parties have been married 30 to 40 years.”

There are many community property states. If you live in a community property state, you need to reconsider how assets are held. “Community property” is a term that refers to how the property during a marriage is viewed in the eyes of the courts. In community property states, all property accumulated by a husband and wife during their marriage becomes joint property. In plain terms, this means that all property belongs to both husband and wife equally if it was acquired during the marriage. This is even true if it was originally acquired in the name of only one partner. Conversely, all property acquired before marriage, or through a gift or inheritance during marriage, is presumed to be the sole and separate property of the spouse who has acquired the property. As with anything in law, there are exceptions, but this is the general rule.

The character of property as community or sole & separate can be important. For example, if spouses divorce, each will retain his or her sole and separate property just as if they had never been married. Any community property will be divided equitably. Equitably does not always mean equally. However, an “equitable” division of assets means a fair division. So you need to protect yourself with the right titling if your in-laws become out-laws.

To help preserve the distinction between sole & separate and community property, spouses will often enter into Ante-nuptial (after the marriage) or Pre-nuptial (before the marriage) contracts so that they have the option of opting out of the community property laws their state adheres to. That way, in the event of a divorce, each spouse will keep the property he or she either brought to the marriage, or acquired under his or her sole & separate designation during the marriage, as provided by the nuptial agreement.

An agreement of this type is helpful and enables the individual to hold property separately from their spouse. But care must still be taken during the course of a marriage to preserve the distinction between community property and sole & separate property. Elizabeth Westby, J.D. contributed to this press release.