Intro:
Welcome to Modern Family Matters, a podcast hosted by Steve Altishin, our Director of Client Partnerships here at Landerholm Family Law. We are devoted to exploring topics within the realm of family law that matter most to you. Our discussions will cover a wide range of both legal and personal issues that accompany family law matters. We strongly believe that life events such as marriages, divorces, re-marriages, births, adoptions, children, growing up, growing older, illnesses and deaths do not dissolve a family. Rather, they provide the opportunity to reconfigure and strengthened family dynamics in healthy and positive ways. With expertise from qualified attorneys and professional guests, we hope that our podcasts will help provide answers, clarity, and guidance for the better tomorrow for you and your family. Without further ado, your host, Steve Altishin.
Steve Altishin (01:11):
Good afternoon. My name is Steve Altishin. I'm the Director of Client Partnerships here at Landerholm Family Law, and I'd like to welcome everyone to our Facebook Live broadcast. Today, we're going to talk about estate planning. We're going to talk about what estate planning is, what it encompasses. We're going to talk about why estate plans are important for everyone at every stage of your life. We're going to talk about what happens if you don't have an estate plan in place. And we're going to talk about how you can move forward with your estate plan, even in today's environment. So to help us through these topics, I'm here with Triston Dallas. Hey Triston, how's it going?
Triston Dallas (01:47):
How are you doing Steve? Thanks for having me.
Steve Altishin (01:49):
Well, I'm doing well. So Triston is an Associate here at Landerholm Family law. He helps our clients with the entire estate planning process, from helping to educate and strategize with them about their estate plan needs, to creating and setting up the right documents to do the job.
So before we start, I do want to encourage anyone listening to this live broadcast, to submit any questions you have, and we'll try to get our best answers to you at the end of the broadcast. Additionally, if you're interested in learning more about family law topics, we have a podcast called Modern Family Matters. These podcasts cover a wide range of topics from divorce and custody, to adoption and estate planning. You can get updates about the new episodes on our Facebook page, Instagram and the Apple store. So now on to our topic. I want to start with a couple of statistics. Only 42% of U.S. Adults have any estate planning documents in place, even a will. Worse, 36% of parents only with children under the age of 18, have any end of life plans in place. And it gets worse with younger populations. Just 28% of millennials have wills. I'm going to give you one last statistic, 76% of people who have no estate plans at all say either "I don't have enough assets", or "I just haven't gotten around to it". Yeah, I get it. Contemplating your own death is not exactly high on anyone's to-do list, but it's important to overcome this barrier and to take control of your assets, and take control of your estate plan. And with that, Triston, let's start with the basics. Just what is an estate plan?
Triston Dallas (03:28):
Great, great question there, Steve. Actually, let's go ahead and let me back up a little, I want to throw in an extra statistic there. Most people, being us non-celebrity types, we're not alone in that, even those with high estates and those with a lot of money, also make the mistake of not having an estate plan. If I remember correctly, Prince didn't have an estate plan. Jimmy Hendrix didn't have an estate plan. And these are people with multi-million dollars, multiple properties in the States, abroad. It can get really convoluted and really messy when you don't have an estate plan with that amount of money, but it also can be as messy when you don't have that amount of money and still don't have an estate plan. But to back up a little bit. Before we say, "what is an estate plan", let's ask, "what isn't an estate?" An estate is everything you own. Everybody has an estate. You, me, neighbors, everybody. From an early age until you are elderly. An estate is your home, your cars, your personal assets, your bank account, all of it. And so what an estate plan does is it creates kind of a road-map as to how your estate is managed while you're still alive and how does it pass to your heirs and your family members or your beneficiaries when you have passed away? And that's the long and short of it.
Steve Altishin (04:54):
Well, that's kind of interesting. I'm wondering: you're talking about estate plans and you're passing stuff on. It seems that you can even sort of pass your values on. There's ways that you can do that and really kind of make what you think is important, even on a non-asset level flow down through, is that correct?
Triston Dallas (05:15):
Yeah. Yeah. Yeah. I mean, some of the most important things to people is their religion, their values. If you have a family that, or a set of parents that, have kids and something happens to both of them, but they want to make sure their kids are raised in Catholicism or Judaism or whatever it may be, you can also leave instructions on how you want your kids to be raised. And even leave instruction as to who you would want them to be raised by and step in and be a guardian. And presumably you could leave instructions saying "hey, I want my child to be raised by X, Y, and Z. And if that person can't do it, they want to be in a home that believes in Catholicism". Really, the sky's the limit for the most part with an estate plan. You can have a lot of options as to how you would want your estate to be managed, but also your family to be taken care of in the event that you're no longer here.
Steve Altishin (06:11):
So if someone's thinking about this, thinking about how they want to manage a lot of these issues, what are some of the initial questions they should sort of ask themselves about before they start to think about how to make an estate plan?
Triston Dallas (06:26):
Yeah. Most people think, "Oh, I just need to figure out where does my bank account go, and who's going to get my car", but really big questions that, you know, every person needs to think about come into play, such as "Who do I want to play what roles in my estate if something happens to me"? Not just when you pass away, but what if you become incapacitated or have a terminal illness or anything like that, who do you want to play power of attorney and make financial decisions and handle your affairs if something happens to you? Who do you want to make medical decisions if you can no longer do so? But also who do you want to play your personal representative or executor and manager of estate if something happens to you? Or who's going to be guardian or custodian, a conservator? Those questions, and those individuals are just as important in answering and understanding as figuring out who's going to get your car and who's going to get your tool set.
Steve Altishin (07:19):
That made me think of a question. You mentioned, you name your guardian, your suggest who you want your conservator or your trustee to be. Those seem like two really different skill sets. But I see where a lot of people just name the same person but it seems like those are different kinds of jobs.
Triston Dallas (07:41):
Yeah. I mean, one person can fill all those roles and will be a very busy individual for sure but so are parents and the parents are essentially filling all those roles while they're here, especially when there's children.
But yeah, I mean, somebody that's going to act as your healthcare representative may not necessarily be the person you want to act as your power of attorney for your affairs, or for them to be conservator for assets for your children. One is going to be a lot more detailed. Somebody acting as the trustee and somebody acting as the custodian may be very different because there's a lot more involved with being a trustee than being a custodian. And so it's possible for an individual to play all the roles. But when you're working with an attorney and trying to get an estate plan put up and put together, I mean, it's important to discuss the differences between each role and really think about who in your circle in your family and your friends would be able to manage and handle that role if something was to happen to you.
Steve Altishin (08:41):
Well, that makes total sense. It even feels kind of like if you've got a couple of different people, let's say the conservator and the guardian, there's a little bit of a system of checks and balances going on in there.
Triston Dallas (08:53):
Yeah, absolutely. It makes the process...I won't say difficult, but a little bit more arduous, if you will, having so many different people, but you're right. It does create some checks and balances because it makes sure everybody's dotting their eyes and doing everything that's necessary. When it's all one person, and again, it's very possible for one person to handle all of that, but when it is one person they may overlook something or miss something because they're handling so much. Essentially that person is trying to manage their own life and the state of affairs and the life of another. It's very possible to miss something. When you have kind of a committee of people that are going to help with the estate or affairs, it makes things a little bit easier and not so much weight is on one person's shoulders.
Steve Altishin (09:43):
So just listening to you, it becomes obvious to me that an estate plan is more than just a will.
Triston Dallas (09:49):
Absolutely.
Steve Altishin (09:50):
We've talked about trusts and all of that stuff. So, you know, what makes up a complete will package?
Triston Dallas (09:57):
Yeah. Well, let me let me touch on your first comment there. It's absolutely more than just a will and it's absolutely more than just the four corners of any document. Again, you're talking about the people who are going to be managing your estate or acting in whatever roles in your estate plan, but also you have to consider: "what are things that are going to be connected to my will or my trust that I need to make sure are taken care of"? Your insurances, your life insurance, those types of things. You want to make sure that they are congruent with your estate plan, your bank accounts, any of that stuff. So it's going to be a little bit more than just, you know, having a document written and you're good to go. That's a step and it's a big step, but it's not everything. And a lot of things can be missed, especially when we start getting into tax planning and estate tax planning, it's going to be more than just having the document. The document is going to play a big role, but there's going to be a lot of analysis that needs to go into beyond just what's written on four corners.
Steve Altishin (10:57):
That makes such complete sense. In my former life, I used to deal a lot with insurance folks. One of the things that we would run up against all the time was having to talk to people who had, let's say a benefit life insurance through their work. Well, they would work on their estate plan. Then maybe we would make a will and name the beneficiaries, but they would never bother to change there insurance benefits. And I had a case where an insurance agent for the business himself forgot to do that. He died. And his wife was very surprised to find out at that point that his ex wife was on his policy. So you're right. There are so many different things you have to go through rather than just the four corners of the document.
And then with HIPPA, and you've run into into this, as you get to the end of life those kinds of things become really important.
Triston Dallas (12:00):
Yeah, absolutely. And to answer the second part of your previous question, what makes up a full estate plan? It really just depends. Every family is going to be a little different, you know, if you're married or if you have children or if you've remarried and have children from a former spouse and your current spouse, every family is going to be a little bit different. But the typical documents that you would see in an estate plan is power of attorney and an advanced directive discussing end of life care and who would make decisions for you in the event of your incapacitation, so medical decisions. A will, a trust, maybe even multiple trusts. You can have a trust within a will if necessary that won't necessarily become live, so to speak, until you pass away. There's a lot of ways to kind of go about it, and so most people may think, "Oh, it's just a will or just a trust", but also it can contain disposition of remains. Who do you want to leave the decision making as far as like, do you want to be entombed or cremated or anything like that? Sometimes that's really important to people. And that goes back to your question about value. For some people it's very important for them and their remains to be disposed of in a very separate way. So there's a lot of small documents that can fit into an estate plan. That's going to be more than just a will or a trust.
Steve Altishin (13:23):
Oh my gosh. So understanding what everyone needs, I mean, that really makes sense. Because it sounds like once you do your estate plan, it starts when you sign and it keeps going until after you die. This is a long-term document. This isn't a thing just for something in the future.
Triston Dallas (13:42):
Yeah, yeah, absolutely. When you're young and let's say, you know, you just got married and you have an estate plan. I would recommend any individual who creates an estate plan to look at it every time that there is a big event in their life. So if they're having children, a significant increase in wages, divorced, remarry, any big event like that, retirement, anything like that, you should take a look at your estate plan and see what's changed. But also I would always recommend every five years or so, look at your estate plan. Again, laws change, taxes. You know, sometimes the tax administration changes based on the administration and who's in the white house. And so you may have created something four years ago, but today it's very, very different. There is, and I won't get too much into the nitty gritty of laws, but there was a big act passed last December.
And this act changed how retirement accounts are passed from one individual to another. And so if you've created an estate plan that looked at the old laws, it may not actually apply exactly the way you're hoping to in the event that you pass away after the act is coming to play. So you're right in thinking it's not just, "okay, I've done it. It's done. I don't have to take a look at it again". Hopefully the estate plan can be flexible enough to cover changes in your life, but it won't be able to cover everything all the time because the laws are always fluctuating and changing.
Steve Altishin (15:15):
Well in the laws in different states are different. It makes me think of Oregon, for instance, is what they call a separate property state. But every single state around us is a community property state. So what happens if I move from a community property state to a separate property or vice versa? It seems like that's a real trigger.
Triston Dallas (15:40):
Absolutely. Moving is definitely one too, especially moving out of state. In that specific instance, again, not getting too nitty gritty of the law, it really would kind of depend on, to some extent, where your property still is. If you held the property in that community property state, but then you got new property in Oregon, you might end up in a situation where multiple probates or multiple court cases are necessary. But yeah, when you move into a different state with different laws and trying to understand how that's going to be probated in Oregon, you look at a tax issue. Oregon's tax threshold for an estate tax exemption is the $1 million for an estate.
And in Washington, I think it's 2.5, something around that. So if you're not close to it in Washington and say you have a $1.7 million estate, but you've moved to Oregon, now you're going to be looking at a tax bill and a state tax bill that you wouldn't have had in Washington. So you may have to take some steps in order to avoid that if possible.
Steve Altishin (16:43):
Well, that makes sense. Like you're saying, you know, one of the things is you're sure that your money and your children go where you want them to when you die, which kind of leads to the question, which I think is the opposite in terms of good. What the heck happens if you die without a will? Where are you then?
Triston Dallas (17:07):
Yeah. A lot, a lot can happen. Again, your plan will enumerate how you want your estate to pass on in the event of your passing. When you do not have an estate plan, don't have a will or trust or anything like that, essentially you are leaving it up to the state to decide how your assets are passed. Now, it being 2020, this wouldn't be the first time that the state would have dealt with this. So they've created laws to try and make it simple for people to understand, but even then it isn't as simple as we would ever hope. The short of it is, if you don't have a will, don't have trust or any estate plan, the way that the court looks at it, the best way I can explain is somewhat of an analogy. If you put yourself in the middle of a compass, and if you pass away without an estate, the first thing the court is gonna do is look down. They're gonna look South. They're going to look to see if you have any children if you're not married. If you're married, everything goes to your spouse and they're not going to look down. If you don't have children, then they're going to look up. They'll look North to see if you have any parents. If your parents are not alive, then they look East to West to see if you have any siblings and if your siblings have children. And then if there's nobody there at that point, you have no next of kin, it's very possible that essentially everything that you have then goes to the state. And the state would essentially own your estate, whether it's home or cars or whatever. If they can't find the next of kin as a beneficiary, then everything goes through the state.
Steve Altishin (18:34):
So you've lost the control you really wanted to have.
Triston Dallas (18:39):
Absolutely.
Steve Altishin (18:40):
That doesn't seem like it's a particular good situation.
Triston Dallas (18:43):
It's not the greatest choice to make. And going back to a little earlier on what we briefly touched on, you don't necessarily need to have millions and millions of dollars to have an estate plan. Estate planning isn't based on the value of your estate. Estate planning is based on your specific values and how you want that to pass on to your next of kin, your heirs, the next generation. And sometimes it's as simple as you wanting to make sure that the home that you have stays within the family. And that may not be accomplished without an estate plan, even if it's a simpler will or simpler to trust. If you don't have anything and think like, "Oh yeah, well sons or my daughters will just get my estate", well maybe not. Maybe you have a debt.
And the court's going to say, "well, we're just going to sell the home to pay for the debt". If you had an estate plan you may have been able to avoid that. So it doesn't necessarily mean you need to have millions of dollars to create an estate plan. I just want to make sure that's clear. You could have $4, you could have $4 million. It still may be very well important to you and important to your heirs and your family to create that plan.
Steve Altishin (19:52):
That makes complete sense, especially if, you know, your kids are to inherit something. And they don't necessarily have something but they have an inheritance coming, then they can do something with that. I mean, there's just a lot of reasons for even young adults to have an estate plan.
Triston Dallas (20:11):
Yeah, absolutely. You know, my wife, before we got married, she had a little bit of a plan.
She wanted to make sure that if something happens to her brother's son, would he be taken care of? And otherwise it wouldn't necessarily have gone that way. Obviously it's not necessarily an issue and we're married now, but without taking those steps to make sure that it's going to the people in your family that you want it to in the way that you want it, the state's not necessarily going to come up with the best case scenario. The state, more often than not, is not going to think in the exact same way that you think as far as what's important to you. Some families may say, "Hey, I want my son to inherit from my estate if I was to pass away before he graduated high school. But I want to make sure that he doesn't get anything or a majority of that estate until he's graduated college, but he can use the estate to pay for his college.
Triston Dallas (21:07):
And so the court isn't going to step in and say "that's a really good idea. We should do that." Even if you didn't have an estate plan, they're just going to say, well, if he's the only heir he's going to get everything. Regardless of how much money it is, trying to give a 17 year old or an 18 year old a ton of money, it's very likely that there's not going to be much left in weeks to come. So you can plan that way as well. I like it.
Steve Altishin (21:31):
So a lot of people love what you're saying. Totally agree with what you're saying, but they're wondering, "well, what do I need you for? I mean, there's will kits out there. Why can't I do my own estate planning?"
Triston Dallas (21:45):
Yup. Well, it goes back to our comment or topic earlier. It's not just the four corners of the document.
You can say I want tools to go to this person and my car to go to this person, my wedding ring to go to this person. That's great. But how do you handle things like the portion of the taxes? You want to make sure that however your expenses are going to be covered from your estate plan is done in a way that doesn't limit your estate or ensure that you actually still have something to pass on. Again, the court's going to say "what's the simplest way to administer the estate and then pass on whatever's left over?" They may liquidate retirement and sell a house, and those other types of things. You're not going to get that type of planning and you're not going to get that type of issue spotting to overcome on will kits. It's just not going to happen.
Steve Altishin (22:36):
That's exactly right. And if there's one thing that I know about estate planning, it's legalistic and it is technical in terms of what you have to do, follow the rules, because if you don't follow the rules, you're back into the "what happens if you don't make a will" category. Someone trying to do it themselves, what are some of the problems they get into?
Triston Dallas (23:03):
Yeah, again, probably one of the biggest ones that comes to mind, you know, we are in a society where half, if not more than half of individuals who get married end up being divorced, which means there's a good population that has blended families. And if you don't have an estate plan or try to create your own estate plan and you don't do it correctly, you can very well disinherit part of your family. If you have stepchildren and you want to make sure that they're taken care of, but you didn't do anything, under the intestate succession rules in Oregon, stepchildren may not necessarily fall in to the individual set of who will inherit, which means there might be somewhat of a probate litigation or a fight from one child saying, you know, I think I should have inherited as well.
It raises a lot more questions when you have kind of just a simple will kit that just says, XYZ goes to this person and XYZ from this person, or you just list children and don't really define how children's supposed to mean stepchildren as well or anything like that. So if you don't take those steps then there's potential that you can overlook some big things. And again, going back to the taxes, there's ways to limit estate taxes in Oregon and will kits, again, they're just not really going to give you the options or even tell you exactly what you need to do to try and limit those things. If you are same sex marriages or same sex couples, I mean, having a toolkit, it doesn't explain that if you're not married, and you just have a domestic partnership and never took a step to get married, you're not going to have the same rights and privileges that an actual married couple would have. The will kit is not going to explain that to you.
Steve Altishin (24:50):
That's hugely important to me because that's an issue that, similar to insurance, people believe that if they're in a domestic partnership or even a registered domestic partnership that they have all of the same rights as married people, but they don't. And so the getting married part or just making the will part, we've covered all that. And we did cover about the need to update. And I really liked you shouldn't really consider making a will on your own. Heck I can't figure out how to do the witness thing right on a will kit. So finally though, before we go, last question. So how can someone go forward from right now, especially in this time, you know, where we're being remote, and either start their estate process or review it.
Triston Dallas (25:45):
Yeah. I mean, we're here. Obviously you can just give us a call and we're happy to have a case evaluation and some brief calls with people to explain what's possible for them. You know, in the midst of COVID, everything is on it's head and people are worried and scared. But also this is a great time for people to take some steps and to take care of things like that, especially because it is a scary time and you want to make sure that you're safe, but also you want to make sure that if something was to happen to you, God forbid that's the case, that your family members are taken care of.
And it isn't as difficult of a process that people may think. And you know, we're here to help people walk through it, hold their hand and make sure that they're taken care of. Sometimes something as simple as a phone call can help the process entirely, and help put a lot of people at ease to kind of get things started. And so you don't necessarily have to go digging for documents that you couldn't find for the past 20 years or whatever it is. That's what the attorneys for, that's what we're here for. And we can tell you what's important, what you do need to find, and we can help find anything that's necessary. But really, just to get started, an email or a phone call will put people in a very, very good place.
Steve Altishin (27:04):
That makes sense, trusting the people who are better at it. It reminds me of when my first kid was born and you know, the doctor turns to me, he says, "you want to cut the umbilical cord?" So I look around at everybody. I go, well, hold on, there's somebody in here that's gotta be better equipped than me at doing this.
Triston Dallas (27:23):
Right. You just have to ask the question and seek the guidance. We are in a society where people are very much independent and capable, and socially there are so many things at their fingertips that you can learn a lot, but there are reasons why people go to school for these things.
Steve Altishin (27:44):
Right, right. So actually I think we've got to conclude, but thank you. This was really cool. And for everyone, that wraps up our broadcast today. We, again, hope you've enjoyed it. We hope you found the information helpful. We're going to be here on a bimonthly and then sometimes a weekly basis. We're going to try to do it at the same time so you'll know where we're at. And you know, again, in these times, these topics are important and we're here for you. And we've got a new broadcast coming, Modern Family Matters, and it's going to be launching next week. It's aimed at addressing a myriad of real life issues: legal, personal financial, that touch real life families. So as a reminder again, thanks Triston. This is Steve Altishin really want to thank everyone for listening today and stay well. Bye bye.
Outro:
You're listening to Modern Family Matters a legal podcast, focusing on providing real answers and direction for individuals and families as they navigate the growths, changes, and challenges of creating their new family dynamics. Modern Family Matters is sponsored by Landerholm Family Law, serving Oregon and the Pacific Northwest and devoted to providing clients with compassionate and fierce legal advocacy with a firm belief in the importance of upholding the family unit amidst complex transitions. If you are in need of legal counsel or have additional questions about a family law matter important to you, you can visit our Landerholm Family website www.landerholmfamilylaw.com, or call us at (503) 227-0200 to schedule a case evaluation with one of our seasoned attorneys. Modern Family Matters, advocating for your better tomorrow and offering solutions on legal matters, important to the modern family.