Bobby’s Blog

What is Estate Planning?

What does “estate planning” mean? Why should I care? Not knowing the answer to these 2 important questions cost my family dearly. If you don’t know what it is, why would you bother doing anything about it? Many people think they know what estate planning is: “oh yeah I have a Will or a Power of Attorney or a Trust” but they have no clue what these documents do. They simply know they have some type of document. If you are looking for a document, download it off the internet and save yourself the time expense of using an attorney. However, beware of the consequences to your family. If you don’t know what your document does, how can you expect your family to have any clue? People are better consumers when buying a high definition tv as opposed to when they are trying to set up their estate plan. Your estate plan directly impacts your family and all the wealth you have created. It might be a good idea to do your due diligence here. A good first step would be to try to imagine what life would look likefor your family members if you were disabled or if you passed away. I could think of a 1000 better ways to spend my time but if you don’t take the time to think about this topic critically, then, in my experience, you will cause considerable emotional and financial damage to your family.

So where would I start? I would define what estate planning means to me. Here is my best definition of estate planning that I use on a daily basis:

I want to control my propery while I am alive and well;
A plan for me and my loved ones if I become disabled;
Then I want to give what I have, to whom I want, when I want, in the way that I want;
All while assuring my wisdom is transferred along with the rest of my wealth.

If one understand this definition and feels comfortable with how their plan works, then I believe you are going in the right direction to protect your wealth and your family. In my next post I will go into this definition of estate planning into more detail and what it means to me. . .

As always, this blog is not intended to be used as legal, tax, and or financial advice. It is simply my perceptions regarding the events that occur in my daily personal life.

Questions the Attorney Should Be Asking. . .

In my recent posts, I have been reflecting on the death of my father and how his estate planning could have been structured to avoid the disaster our family encountered when he was diagnosed with Alzheimer’s. He (and our family) lived with the disease for 12 years. If I had the opportunity to rewind the clock and if I was the attorney handling my father’s estate plan, here are some of the questions I would have asked him that were NOT asked:

Attorney: Mr. Feisee, as your attorney I need to prepare a plan that will address your needs immediately. Let’s call it “Next Month” Planning. In this regard, I would like to explore some different scenarios with you and get your thoughts.

Dad: Okay, what would you like to ask.

Attorney: If we were to do nothing as far as planning and you were to have a stroke next month, or be diagnosed with Alzheimer’s or some other catastrophic illness, can you describe how life would look like for your wife?

Dad: Well, since I own my own business, we would lose all that income. I guess my wife would have the burden of paying 2 mortgages with half the income. As far as my care, I guess she would be responsible for taking care of me as well. I guess she would be put in a very stressful position. Life would be tough, I am not sure how she would get by.

Attorney: Let’s fast forward 10 years and say that your wife managed to make ends meet for 1o years while taking care of you. Let’s say you pass away at this point. Can you describe how life would look for her at that point?

Dad: Well if she had to take care of me for 10 years, while working and paying all the bills including my medical care, I would say that she would be in a difficult financial position. She would probably have to work another 10 years at least and probably work until the day she died.
After going through 10 years of dealing with my care, I am guessing she would just want a break and take it easy since she is in her 70s. Life would look pretty bleak for her too.

Attorney: Let’s look at the other side of the coin and say that we did do some planning and that the plan included things like long term care insurance, diability insurance, and life insurance that would fill the liquidity needs of your spouse and family if these events were to occur. How might life look like then?

Dad: Well if there was money coming in to take care of me, that would lighten the load tremendously. If we could replace my income that would be a tremendous relief to my wife. As far as the life insurance, although I am not a big believer in, I see how it could be the ultimate gift I could give to my wife. I never looked at it this way.

Attorney: Maybe we should explore some options and talk to your advisors about how we can make this work with your budget.

Dad: Good idea.

This conversation could have saved our family over $600,000 in long term care expenses and hundreds of thousands of dollars in lost income and mortgage expenses. Maybe my dad would not have implemented all the ideas, but I think he may have done 1 or 2. Those 1 or 2 items could have changed our family members’ lives life tremendously. My mom currently works 8-10 hours a day and she is in her mid 70s. There is no vacation in sight. . .

As always, this blog is not intended for financial, legal, and/or tax advice. It is simply a place where I reflect on my personal life experiences. I am not selling any financial or insurance product; talk to your own professionals for any specific advice.

Make Sure You Get The Family Involved

I never spoke to my dad’s attorney about his estate plan. The plan was put in a drawer and we never bothered to look at it or talk to dad about what he had done. After dad was diagnosed with Alzheimer’s, I reviewed the documents and realized that it had nothing to do with my father and the instructions were not clear at all. I should have had the opportunity to discuss what my father wanted directly with my father while he was coherent. I believe an estate planner’s role should be to facilitate this type of family involvement. Two critical pieces of an estate plan are clear personalized instructions and family involvement. If you think you are doing your family a favor by not discussing these issues think again. If I could do it over again, I would have discussed the plan with my father and his attorney. I would have asked about the steps I should be taking to help prepare our family and to get our affairs in order beforehand. I prefer a proactive approach to a reactive approach any day. . .

As always this blog does not constitue legal, financial, and/or tax advice. It is simply my perspective on the events that have occurred in my daily life.

Doctor J. Feisee

My father passed away this weekend after a 12 year battle with Alzheimer’s disease. For those of you who are lucky enough not to have encountered the disease I will give you some of my reflections and insights to give you the benefit of my experience. Over the past 10 years our family has spent over $600,000 out of pocket to take care of my father at home. We are a very close family and come from a tradition of taking very good care of our elders. Unfortunately, like most close families we never discussed what life would like if dad became disabled. This is considered to be a “taboo” or unspoken subject. Well I am here to tell you, if you don’t talk about it now with your family then you place the burden on them to talk about it at the worst possible time. You also give the family very few options and are mostly left with heartache.

My father never told me about the level of care he desired and how long he wanted this care to continue. We never discussed where the money would be coming from to pay for his care. However, we did have a legal document called an Advance Medical Directive that designated my mom and then myself as his health care agents. This document, in one form or another, is used in virtually all estate plans. The problem is that it is just that, a form. It does nothing but put the legal burden of making health care decisions on your agent. It does not provide any guidance to your agent as to what type of care and level of care you want. It does not tell you where you would like to be treated and for how long. It does not pay for the care. I think most importantly it does not tell your family how much you love them nor does it provide any of your wisdom. It is just a form document.

What things should a family be considering when dealing with disability and death planning? Well, one thing I regret every day is that I did not ever sit down with my dad before his illness to record some of his great stories and experiences that he use to tell us about. My dad came from very humble beginnings and beat significant odds to marry my mom and to become a doctor. He would tell us these stories with a smile on his face that could light up a room. Those precious stories of how he rose through the ranks will never be told by him again. Although, I will do my best to capture and put those stories in my own words, I wish I could listen to him again. I also wish I had a chance to ask him certain questions about major life choices (his thoughts on how to run a business, his experiences and lessons about money, major influences in his life, the values he tried to instill in me and why they were important. When this illness struck, I had recently graduated law school and was getting to a point in our relationship where father-son was becoming father-friend. I dearly wish that I had an opportunity to talk to him again to record his thoughts. When estate planners talk about transferring assets from point A to B, most seem to focus on the material wealth. My father’s material wealth was very small compared to the wealth of knowledge and wisdom that he kept inside of him. There is a quote I have heard that states “when an individual passes away, it is like a library burning down.” That quote makes a lot of sense to me now.

I also wish I did a lot of other things to prepare our family for my father’s disability. As an estate planning an attorney, I believe it is my duty to help families and change people’s lives for the better. I will discuss what other actions I would have taken in my next blog. . .

As always, this blog is not intended to give legal advice, tax advice or financial advice. It is simply my reflections on my own personal life events. Any other use of this information is strictly prohibited.

Grief Counselling

Last week I went to an estate planning conference where one of the keynote speakers specialized in grief management counselling. I think it is a brilliant idea to have this type of speaker talk to estate planning attorneys. Most attorneys do not understand how to relate to a grieving widow who is the going through the most difficult time in her life. These type of counselling issues are not addressed in law schools. However, you will find many courses on probate and tax adminstration of estates.
Do most attorneys have any idea what a widow is going through emotionally during and after the funeral? I believe an attorney must ask himself/herself how they can truly provide support to the family during traumatic events such as disablilty and/death. I think these are the real issues that attorneys should be focusing on in addition to the “default” estate administration issues. I put the word “default” in quotes because I feel that estate settlement issues are poorly addressed with most clients; and families have no idea what steps are involved when a loved one becomes disabled or passes away. I will speak more of this issue in my next post.

Grief Counselling

Last week I went to an estate planning conference where one of the keynote speakers specialized in grief management counselling. I think it is a brilliant idea to have this type of speaker talk to estate planning attorneys. Most attorneys do not understand how to relate to a grieving widow who is the going through the most difficult time in her life. These type of counselling issues are not addressed in law schools. However, you will find many courses on probate and tax adminstration of estates.
Do most attorneys have any idea what a widow is going through emotionally during and after the funeral? I believe an attorney must ask himself/herself how they can truly provide support to the family during traumatic events such as disablilty and/death. I think these are the real issues that attorneys should be focusing on in addition to the “default” estate administration issues. I put the word “default” in quotes because I feel that estate settlement issues are poorly addressed with most clients; and families have no idea what steps are involved when a loved one becomes disabled or passes away. I will speak more of this issue in my next post.