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Sitting at the desk I decided to scan some old material, as I ripped apart pages, arranged neatly for the Fujitsu to do its job, I notice one page marked up so much I could hardly read it. Here then, worth sharing a few words you’ve heard in different ways before, and will likely hear again. If you find the principle difficult to accept, ask, “If this were true, what changes would I make in my life?”
“Beliefs matter…you can’t perform in opposition to your true beliefs…nor exceed whatever limits your beliefs…impose on you. I was taught the principle of ‘it’s ALL my fault, good or bad’ and I’ve embraced it despite the obvious intellectual argument for exceptions, because anything less permits excuse-making, permits belief in circumstances beyond my control, permits many other unhelpful beliefs. Better the occasional very sharp pain of this one. So, when I was rear-ended in bumper to bumper traffic…”
The article I reviewed, then describes the perpetrator – a moron driving completely out of control, then realizing that while it might have legally been the moron’s fault, in reality he could see it was his responsibility. He was late, had procrastinated running this errand, knew the traffic would be terrible because he put it off. “I can be mad at him all I want, and I was…but there’s no present or future profit in it. It’s only value is reminder not to be stupid.”
The article closes with examples of the very successful living by the code that “…all that occurs (in their life) is their personal responsibility.”
Scale of 1-10 how are you doing with this concept? Selective application or “all in”?
About the author: Mr. Parman is a frequent guest on the radio and can be seen on television talk shows explaining the importance of proper estate planning. Prosperity Productions selected Mr. Parman is a featured speaker in a nationally-recognized educational video on Living Trusts. He is the author of numerous published articles on financial and estate planning matters and the co-author of two books, Estate Planning Basics: A Crash Course in Safeguarding Your Legacy and Guiding Those Left Behind in Oklahoma: Settling the Affairs of Your Loved Ones.
Mr. Parman is a Member and Fellow of the American Academy of Estate Planning Attorneys. He is also a member of the Oklahoma and Missouri Bar Associations, the American Bar Association, and the Oklahoma City Estate Planning Council.
Academy Guest Blogger
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com
Robert Armstrong’s inspiring recent blog, “Unlimited Possibilities,” referenced the attitude of Apple’s Steve Jobs. Jobs sees death as “the most important tool I’ve ever encountered to help me make the big choices in life.” Jobs has courage. He is also a smart planner.
When Jobs announced that he was stepping down as CEO, there was no ripple in the company’s stock price, as is usually the case when a high-profile executive leaves a company. In fact, the stock fared better that day than the overall market. Why? Jobs actually planned for this move. He had a succession plan all mapped out and he nurtured his people and his company’s culture accordingly.
Estate planning attorneys deal every day with the “what-ifs” of life. So what if you were to become disabled or die? Do you have a succession plan in place that ensures that your practice has the leadership and expertise it needs to carry on successfully? Is this the case for your top people and your partners?
Succession planning is probably more important to a company the size of a typical estate planning practice than it is to a multinational such as Apple. Of course, you don’t have the talent pool that an enterprise organization has, but even if you did, it’s important to have a formal procedure for identifying, nurturing and retaining individuals at every level who could step up to the plate.
As an estate planning attorney, you know how to put in place the legal framework for succession, such as a buy-sell agreement. But, you may have overlooked the practical aspects of succession.
Here are some guidelines for creating your practical succession plan:
- Establish clear business, growth, and cultural objectives for your practice and make sure that all partners are on board.
- Identify individuals who have the capacity and willingness to step into a new role, at every level.
- Clarify career expectations of your staff and strive to meet those expectations.
- Focus on the retention of your staff. Turnover and recruitment are costly.
- Identify successors for the key people in your firm.
You’re involved in planning every day. Practice what you preach by anticipating the “what ifs.” Your business does not have to be the size of Apple to have a great succession plan. Take the time to develop a formal succession plan. If you are successful in implementing a great succession plan, your business can carryon even in the event you can no longer work in the business.
Stephen C. Hartnett, J.D., LL.M.
Associate Director of Education
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com
Every day we work hard to help people leave a lasting legacy at Legacy Safeguard. We’ve created some of the most comprehensive legacy planning and end-of-life planning services in the legacy planning industry and we’re proud to help people be remembered long after they’re gone.
I also travel frequently across the country speaking to groups about the importance of legacy planning and I’ve found that people always want to talk about their family when thinking about their legacy. People want to talk about their kids and grandkids, and the hope they have for the next generation of their family. Over the years, I’ve realized that legacy planning is all about your family and the generations to come. This may sound obvious to most of you, but it has really hit home for me recently.
My wife and I started trying to have a family and we have struggled with infertility issues for over two years now. At first it wasn’t that big of a deal. We kept thinking it would work the next month. However, one month turned into a year and half. The disappointment each month was really unexplainable. Then Robyn finally got pregnant and we were overjoyed! I immediately started thinking about my hopes for our children and who they would become. I even went to see my estate planning attorney, John R. Vermillion, to make sure that we had everything prepared, so that if something happened to me that my family would be protected.
That joy and excitement that we felt quickly faded when Robyn miscarried and we lost the child we had hoped and prayed for. After recovering from the grief and loss of losing the pregnancy we started trying again with the help of fertility specialists. Again, Robyn got pregnant, and again we lost the pregnancy. We were devastated. It has been the hardest thing we’ve ever had to walk through. The hope of having children, and the hope of leaving a legacy through our family has been more challenging than we ever expected, but we remain hopeful that one day we will be blessed with children of our own.
Remember as you help people plan for their legacy through proper estate planning, that it all comes back to the basic needs of family and providing for the future. Make it personal, and encourage your clients to share with you about their hope for the future of their family. Estate and legacy planning really comes down to everyone’s hope for leaving a legacy!
Bryan W. Adams is President & CEO of Premier Planning, LLC and Founder of Legacy Safeguard. Bryan is considered one of the nations’ leading experts on final expense planning, and he frequently speaks throughout the country about the importance of assisting clients to gain peace of mind through advanced funeral funding.
Bryan’s passion for helping families prepare for their final expenses came from being raised in the funeral business. His family still owns and operates several funeral homes, and he is constantly amazed at how unprepared families are when a death occurs. Bryan has worked tirelessly to help Americans plan for the inevitable and lessen the burden on their loved ones
Academy Guest Blogger
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com
We have a lot of conversations around here about what a revenue producing task is and what it isn’t.
It’s easy to get caught up in a trap doing work that “feels” productive—but in all reality, you may just be pretending to be busy.
If you “spend time with a prospect or a client” you may be able to go home feeling, “well… it was a great day, most of my time was spent with a possible client or a client. What a productive day.”
Here’s the litmus test.
Did you get a check?
Was the time you spend with those people, spent in a situation where the end of the conversation could result in a check? Or were you on the phone answering questions a paralegal could have handled while you were in an *actual* meeting?
I would advise considering a “long prospect call” or “substantial client call” any form of an “appointment.” Appointments end with a decision and 88—92% of the time, those decisions involve a payment to your law firm. You want to construct systems that put you face to face with the prospect because that’s where your solutions can be presented and that’s where the law firm’s revenue is. You solve a problem on the phone… you get a thank you, you solve one in person… you get a check. If you’re doing old-school “billing” for the time on the phone, that is a part of the system we wouldn’t recommend and you may want to think that through. Most phone work could and should be handled by a paralegal. Your systems should be set up so that you are in revenue generating meetings. There are occasions where there is a need to conduct a revenue generating meeting ON THE PHONE, but they should be rare and for special circumstances.
Jennifer Price
Director, Member Services
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com
The stock market may be shaky and that garners a lot of attention in the press. Of course, low asset values can be great for most estate planning strategies. But, let’s think beyond asset values. Your clients can capitalize on today’s low interest rate environment in their estate planning. By suggesting this (and explaining it to your clients) you can be the estate planning hero.
From January 1991 through March 2009 the Section 7520 rate averaged more than 6.3%, with a peak of 9.4%. The IRS set the rate in October 2011 at just 1.4%.
Interest rates have an impact on the effectiveness of many estate planning strategies. Whether rates are high or low, there are meaningful shifts in the effectiveness of estate planning strategies. Of course, the strategy still must meet the client’s goals and situation.
Interest rates do not affect certain strategies such as Tenancy in Common Fractionalization and Family Limited Partnerships / FLLCs. Other strategies are simply not that interest rate sensitive, such as the Charitable Remainder Unitrust, the Charitable Lead Unitrust, and the Grantor Retained Unitrust.
However, some strategies tend to work much better in a low interest rate environment (like today):
- Grantor Retained Annuity Trust
- Sale to Intentionally Defective Grantor Trust
- Chartable Lead Annuity Trust
- Loans to Family Members
It may be a very good idea to take a closer look at your client’s estate planning goals and the possible use of these strategies, in light of today’s interest rate environment.
The key message to deliver to your clients is this: “Some strategies work better in a low interest rate environment. Today’s rates are very low; the lowest we’ve seen in generations. It can be to your advantage to shift your estate planning strategies accordingly.”
So, be the hero to your client. Suggest they take a closer look at strategies that take advantage of low interest rates, as well as low asset values.
Stephen C. Hartnett, J.D., LL.M.
Associate Director of Education
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com
Former American Idol judge and The X Factor creator Simon Cowell. Famed baseball slugger Ted Williams. Bredo Morstoel. Robert Ettinger. What do these four men have in common? And who are Morstoel and Ettinger?
They all have been, or intend to be, put into a cryogenic deep freeze after death. Their hope: when medical science comes up with a cure for whatever ailed them, they can be revived, cured, and restored to life.
Given that this might happen hundreds of years in the future, if at all, the question is – how will their estates pay for this? You think modern medicine is expensive now, wait until 2311!
Cryogenics is a wild and woolly world. It’s a challenge for the estate planning attorneys of today and could be an issue for decades to come.
Robert C.W. Ettinger conceived cryonics and popularized the idea in a 1963 book, “The Prospect of Immortality.” Ettinger died on July 23, 2011, at the age of 92. Mr. Ettinger’s body was promptly placed in a cryonic capsule and frozen at minus 371 degrees Fahrenheit, after several days of graduated cooling.
Ettinger was a physics instructor and science fiction writer. His idea of freezing the dead for future reanimation repelled most scientists. Still, he persuaded at least 105 people to pay $28,000 each to have their bodies preserved in liquid nitrogen at his Cryonics Institute in suburban Detroit. His mother, Rhea, who died in 1977 at 78, was his first patient. No word in Ettinger’s obituary on how his family will continue to pay for the service in the future.
Before Simon Cowell indicated he’d like to be frozen, baseball legend Ted Williams, whose freezing at an unrelated Arizona facility in 2002 set off a well-publicized family feud, was probably the most notable cryonics adherent.
But even before these two famous cryonics fans, there was Trygve Bauge, grandson of Bredo Morstoel from Norway. We have Grandpa Bredo and Trygve to thank for the annual Frozen Dead Guy Days festival in Nederland, Colorado.
After Grandpa’s death due to a heart condition in 1989, Trygve had him packed in dry ice and shipped to a U.S. cryonics facility. In 1993, Trygve, hoping to start his own cryonics service, moved Grandpa to his concrete bunker home in Nederland, a tiny town 17 miles west of Boulder.
The story then takes a number of interesting turns. Trygve was deported back to Norway in 1995 due to visa issues. Long story short – Grandpa Bredo has been kept in a Tuff Shed-sheltered, dry ice-fueled deep freeze in Nederland ever since. The family sends money monthly to keep the dry ice stocked.
But how long will the family keep sending money? Grandpa Bredo has been on ice for 21 years. As far as anyone can tell, there is no family trust in place to keep “The Ice Man” coming with the monthly 1,600 pounds of dry ice that keeps Grandpa at a steady (and cryogenically inadequate) minus 60 degrees Fahrenheit. (Kids, don’t try this at home!)
At this point, the money from the annual festival benefits the town, not the family. This year, the Nederland Chamber of Commerce put the festival, now going into its 11th year, up for sale to a professional festival organization.
I’m sure the family and the Chamber of Commerce would appreciate any free advice as to how to keep the cold hard cash coming.
Gail Rubin, Certified Celebrant, is author of A Good Goodbye: Funeral Planning for Those Who Don’t Plan to Die and The Family Plot Blog (http://TheFamilyPlot.wordpress.com). She debuted The Newly-Dead Gameä at the 2011 Frozen Dead Guy Days festival in Nederland. The game is a fun, upbeat way to get the funeral planning conversation started: http://agoodgoodbye.com/newly-dead-game.
Academy Guest Blogger
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com
Given the retirement of Steve Jobs as CEO of Apple, I was reminded of his attitude about his health risks and how it empowered rather than limited him:
“Remembering that I’ll be dead soon is the most important tool I’ve ever encountered to help me make the big choices in life. Because almost everything; all external expectations, pride, fear of embarrassment or failure; these things just fall away in the face of death, leaving only what is truly important. Remembering that you are going to die is the best way I know to avoid the trap of thinking you have something to lose. You are already naked. There is no reason not to follow your heart.” (Steve Jobs, 2005 Commencement speech).
This got me to thinking about the hundreds of other examples of those who suffered severe setbacks in life, only to recognize later that these events opened the door for accomplishments that transformed them.
I immediately think of Lance Armstrong and the cancer that almost took his life, yet he has often said it was the defining moment of his spectacular career.
Rachel Ray, who was mugged twice coming home to her apartment in New York City and fearing for her life went back home to upstate New York and the safety of her family. To make ends meet, she started a little cooking class in a local market where she was working and wrote a little book on 30 minutes dishes. Al Roker from NBC was from Syracuse and was handed the book. This led to a last minute spot on the Today show, and of course, the rest is culinary history.
Jim Braddock, the “Cinderella Man” and heavyweight champ of the world was known in his early career as a fighter without an effective left hand. During the depression he broke his right hand and thought his career was over. He was forced to work on the docks only using his left hand. By the time he got his shot at Max Baer for the title fight, his left hand was as lethal as his right and helped him win the fight in 15 rounds.
There are far too many examples to recite here, but the lesson for me is that you never know in life what’s good and what’s bad. Looking back on my own life, there were times that felt desperate and unsalvageable, but reflecting back I can see who I was able to become in those moments opened up a life of new possibilities.
How about you? In your life, are you able to see past setbacks in a new positive light?
Robert Armstrong
President & Co-Founder
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com
As estate planning attorneys know, parents usually leave their assets equally to their children. However, we also know, both personally and professionally, that sometimes an equal division is definitely not fair. Sometimes children have different needs and abilities. For example, one child might be a successful physician, while another might be an award winning teacher. Both professions are valuable and have merit. However, society values those contributions disproportionately.
Another situation warranting an unequal division of assets might be where one child worked for decades on the family farm, which represented the majority of the value of the assets.
A recent article in The Wall Street Journal examined various reasons and may be found here.
There are still more reasons parents might choose to treat their children unequally. For example, one child might have cared for the parents in their declining years. Another child might have special needs. Whatever the reason, the estate planning attorney’s job is to ensure that their clients’ wishes are carried out. It is important to remember that an unequal distribution might trigger a challenge to the estate plan.
There are various ways to discourage such a challenge. First, an in terrorem, or no contest clause may be included in the Will and / or Trust. With such a clause, a challenger will take nothing. This is an especially potent device when the would-be challengers are given something, even if a smaller share. Another way to encourage children to honor the parents’ wishes is by having the parents write a side letter as to their reasons for the unequal treatment. It is better to have this as a side letter so that it is more difficult for would-be challengers to use external evidence to show that those reasons do not exist and, therefore, the distribution should be equal after all.
Facilitating a fair division of assets may be one of the most important things that we as estate planning attorneys do. What do you do to encourage the children or other beneficiaries to honor the wishes of the decedent? Do you include an in terrorem clause? Do you use a side letter? Do you use additional measures?
Stephen C. Hartnett, J.D., LL.M.
Associate Director of Education
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com
According to a recent study by the Mind Perception and Morality Lab at the University of Maryland, people view patients in a persistent vegetative state (PVS) as worse off than patients who have died. Published online in Cognition (http://www.sciencedirect.com/science/article/pii/S0010027711001752), the study consisted of three experiments. Here is the Abstract:
“Patients in persistent vegetative state (PVS) may be biologically alive, but these experiments indicate that people see PVS as a state curiously more dead than dead. Experiment 1 found that PVS patients were perceived to have less mental capacity than the dead. Experiment 2 explained this effect as an outgrowth of afterlife beliefs, and the tendency to focus on the bodies of PVS patients at the expense of their minds. Experiment 3 found that PVS is also perceived as “worse” than death: people deem early death better than being in PVS. These studies suggest that people perceive the minds of PVS patients as less valuable than those of the dead – ironically, this effect is especially robust for those high in religiosity.”
The complex views of PVS illuminated in this study further illustrate the importance for clients to be clear in advance about their medical wishes and to not assume that others will be able to infer what they would want. It also speaks to the possibility that people may hold simultaneously conflicting views about PVS when making decisions on behalf of a loved one in a persistent vegetative state.
Randi J. Siegel, MBA, is the President of DocuBank, the largest advance directives registry in the U.S., which ensures that the healthcare directives of its 190,000 enrollees are immediately available 24/7/365. Working with estate planning professionals since 1997, Randi frequently speaks at national estate planning conferences and has appeared on radio and television as an authority on registries. She is active in health policy pertaining to advance directives and serves as a Senior Fellow at the Jefferson School of Population Health in Philadelphia. Randi is an ongoing contributor to the Academy blog.
Academy Guest Blogger
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, CA 92123
Phone: (858) 453-2128
www.aaepa.com
In my mind and the minds my leadership team there has always been an underlying question:
“Why, despite a consistent response rate hovering around the 1-2 percent mark year-over-year, does there always seemed to be a number of mail recipients who would not respond to a seminar invitation?”
Several years ago, we engaged the services of Waypoint Data Systems to conduct a comprehensive review of past seminar responders. The goal: Identify key demographic markers that would indicate the likeliness of a prospect to attend a dinner seminar. In the process of that modeling exercise, Waypoint reported that less than 2-in-10 Americans had attended more than three (3) dinner seminars. This meant that the 2 percent average response rate was not due in any measurable fashion to chronic seminar attendees – commonly called “plate lickers.”
It also identified a segment of the population that was NOT going to respond to traditional seminar marketing efforts – despite their overwhelming need for financial and estate planning advice.
What are these people looking for instead?
The answer presented itself in the application of the product development strategies identified in the best-selling book, ¹Blue Ocean. The basic idea behind the Blue Ocean Strategy is that an organization may experience higher growth and increased profits by creating new demand in an uncontested market space instead of trying to compete in a market space that is already overcrowded with competitors. For us, that means developing new ways to market to consistent audiences, like Concierge Consultation.
What do you do to overcome these challenges?
We have our own processes, but we also like hearing what everyone is doing or would like to do in the future to handle this issue.
Jorge Villar is President of Response Mail Express (RME), with more than 26 years of direct marketing experience, he is known in several industries for his ability to create mail packages that garner the highest response rates. He is responsible for the Seminar Success program that, for the last 17 years has accounted for more than 65% of the events being held in the nation with over 14 million individuals making reservations. Mr. Villar has also been very successful marketing to physicians and business owners regarding Success Planning and Asset Protection. Response Mail Express, and parent company DME, is a $100+ million marketing powerhouse, housing over 600 employees in their 2 state-of-the-art facilities in Florida. Their marketing ideas are presently being utilized by over 10,000 clients, including: top producing advisors, estate planning attorneys, large financial organizations, health care organizations, universities and many other industries. Mr. Villar is a frequent key note speaker at national financial symposium and training conferences.
Note: This blog entry is a shortened version of a comprehensive White Paper on this subject. To receive a copy of the full document, please contact Josh Danielson at jdanielson@responsemail.com.
Bibliography
¹Blue Ocean Strategy, (Boston: Harvard Business School Press 2005), ISBN 1591396190
Academy Guest Blogger
American Academy of Estate Planning Attorneys, Inc.
9444 Balboa Avenue, Suite 300
San Diego, California 92123
Phone: (858) 453-2128
www.aaepa.com
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