LENSMAN: Good evening, I'm Kitty Lensman, President and CEO of CET and ThinkTV.

Welcome to Plant the Seed, our virtual estate planning seminar.

Nearly 10 years ago, CET and ThinkTV were part of a small consortium of PBS stations who were asked to help others in the PBS family to establish or grow their Planned Giving Programs.

We were asked partly because of the extraordinary dedication of members in the community who formed the CET Planned Giving Committee.

This group, led by Chris Buttress, has helped the station establish a number of community resources and we are so grateful for their time and talent.

Non-profits like CET and ThinkTV truly benefit from planned gifts, and we have seen a tremendous increase in gift notifications and realized requests over the years.

These planned gifts, unless noted by the donor, go to our endowment so that our work continues for future generations.

The session we're about to share was prerecorded in our studios by three members of the CET Planned Giving Committee.

Please enjoy the program and use the chat box below to ask your questions.

Our experts will answer them live from the studios in just a few minutes.

Here is Plant the Seed: A Discussion about Estate Planning.

[MUSIC] Hi and welcome to the CET and ThinkTV Planned Giving Seminar and Panel Discussion.

You may have received one of these hard copy or electronic financial planning booklets from your PBS station and have been wondering, "What do I do with it or what do I need to get my plans in order?"

We hope this session will help guide and answer some of your questions.

I'm Mike Miller, a volunteer at CET and Head of Wealth Management at LCNB National Bank.

Joining me, socially distanced of course, are two other volunteers, Chris Buttress, a partner and estate planning attorney with Graydon; and Jami Vallandingham, a shareholder and CPA with VonLehman.

Ladies, welcome.

VALLANDINGHAM: Thanks, Mike.

BUTTRESS: Thank you, Mike.

MILLER: You know, ladies, as I look at this brochure, I see that there are a lot of decisions to be made when we talk about estate planning and planned giving.

And I'd like to get your thoughts on how do you have a conversation with people to make sure that the decisions that they make are by choice and not by chance?

Jami?

VALLANDINGHAM: So really, Mike, I appreciate you having us here today.

You know, the discussion really comes down to just being comfortable with the client because they really need to be honest with you in really and what they are thinking.

They need to make sure that they're doing what they feel is important and not kind of succumbing to different pressures.

And really just talking to them, walking through the process, the things that are important, things that they're thinking about, but don't really know how to handle, don't know how to step forward with that.

MILLER: How about you, Chris, from an attorney's perspective, how do you start that conversation?

BUTTRESS: Mike, I ask a lot of questions.

Clients often come to me and say, "I think I need" whatever.

And by asking questions, I'm able to clarify what's really important to them, what their goals and objectives are, and sometimes eliminate the misconceptions they have based on conversations with their friends, their neighbor, family, their hairdresser, whoever it is that gives them the best advice.

MILLER: It would seem straightforward.

It would seem like it's a good idea for people to do estate planning, a good idea for people to do, you know, thoughtful plan giving.

But I know from my past, you know, estate planning practice, people don't want to have those conversations.

Why not, Chris?

BUTTRESS: Well, there are a lot of reasons that people don't want to have the conversations.

They're uncomfortable with the topic.

They have to face their own mortality, and that's difficult.

Oftentimes, spouses don't necessarily agree on what they want for their children and their family.

The inability to make a decision on who's going to be the guardian for your children can be one of the most difficult things to make.

And a lot of times people have cultural issues that cause them to be unable to deal with these kinds of situations.

MILLER: Jami, how about from your perspective?

VALLANDINGHAM: I think also one of the things is a lot of times people don't know where to go.

Really, just depending on what your family or your friends are, you may not know who to actually talk to about it.

So it is somewhat scary as far as, "Who do I open my soul up to and tell them all of these things that are so near and dear to me?'

MILLER: Well, it seems to me that people should talk to people that they trust.

And I also know a lot of very smart people that do estate planning or want to do their estate planning they want to make planned gifts, but they just put off the decisions and they put off the process.

Why do you think that is?

VALLANDINGHAM: I think Chris actually hit on quite a few of the topics.

You know, one of the things that they have to think about is that I'm not going to be around forever.

And hopefully by going through this process, they do understand that it's not as bad as what you think.

It's really just taking that first step and trying to get things established.

But really, it is a mortality issue that you're worrying about for yourself.

MILLER: But do people really understand the legacy that they can leave for their children, for their communities?

VALLANDINGHAM: Right.

And really, through this process, so much of it is designating some of those things, whether it be what you want your charitable gifts to be after you pass, who you really want to run things for you, who should take over.

You know, business succession planning is a big thing.

And really, what is the plan for G2 running through, or generation two, excuse me, when you start talking about transitioning your business as well?

MILLER: Chris, you mentioned cultural impediments.

What kind of things are you talking about when you say that?

BUTTRESS: Well, people come from different cultural backgrounds and in some cultures people just don't talk about death.

I had that experience recently with a potential new client.

We had a very nice conversation.

And the person said to me, "Chris, you have to understand we don't talk about death in our culture."

So that's the extreme.

And sometimes it's just within families.

They don't talk about money.

They don't talk about what's going to happen when mom or dad passes.

They just can't deal with those kinds of issues.

MILLER: How do you respond to those things?

How do you help people to understand the importance of making those decisions and having to have those conversations?

BUTTRESS: Well, each of us is going to die someday, I hate to tell you, and we don't know when it's going to be.

So the thing is, if you want it to be as painless as possible for your family members, not that it's going to be painless, it's important to plan and not just leave things to chance.

There are a lot of things that we can't control in this world, but the decisions and the planning we make in advance are things that are within our control.

You know, when I talk about estate planning, sometimes people think it's all about dollars and cents.

It's like the game of Monopoly.

And I tell them, "No, it's not the game of Monopoly.

It's the Game of Life.

Some of it is about dollars and cents and some of it's just about the things that happen in the course of our lives.

Some of them are things that we choose and some of them are things that just occur."

MILLER: Jami, I'm trying to get over my anxiety about Chris telling me I'm going to die someday.

But is that the reason that a lot of people procrastinate and they just put it off because they think, "I've got plenty of time.

We'll just wait and see what happens"?

That's not a good idea, I would imagine.

VALLANDINGHAM: Not a good idea.

And that really is one of the biggest hampers that there are, is that people think I have time and you really don't.

You have no idea what's going to happen.

And to do a little bit of homework up front can really, really impact your family.

And they're going through a tough time when you do pass.

So if you can kind of ease that at all, it would be very helpful for them too.

MILLER: I've talked about -- I've mentioned the words, I should say, estate planning and planned giving.

As an attorney, why don't you help us understand the difference between the two and how they do intersect at some points?

BUTTRESS: Well, estate planning is a much broader area.

You know, sort of the technical legal definition is it deals with the disposition of your property during your lifetime and after.

Planned giving really relates to your charitable goals.

It can be during a lifetime.

You know, what's the best way to make those dollars do as much as they possibly can for the organizations that are near and dear to you?

Do you give cash?

Do you give stock?

Do you use your IRA?

All of those things enter into it.

And, you know, it's hard to make an unplanned gift, but a planned gift is a well thought out gift that accomplishes your goals and objectives and does the best job it possibly can for the organizations that you support.

MILLER: Jami, as an accountant, what's your perspective on that?

VALLANDINGHAM: I agree with Chris.

The things that you can lay out beforehand are so important.

You may think people know what you want, but there's no guarantee at all that that is truly what's going to happen after you are gone.

Unfortunately there I have seen enough situations that things can go pretty south pretty quick after you pass and people are making decisions that, you know, in my position, I may very well know that's not what they wanted, but it's their decision is theirs.

So the heirs are the ones making those decisions when you do not have the plans laid out.

MILLER: I guess this is not a one time conversation.

How does that process work?

I mean, a client comes to you and says, "I'm interested in estate planning.

I need a will.

I need a trust.

I need a lawyer."

How do you process that and how often should you talk to your clients about that?

VALLANDINGHAM: So really, once you get the baseline established, that really should be revisited every 3-5 years.

Things change, rules change, your ideas change.

I know just from my own experience, when I first did all of mine on my will and my medical directives, there were some things I put in there.

And given that I'm a little bit older now, it's time and I need to redo mine.

And it just -- there are things that change as you get older, as your life changes, as your situation changes, you absolutely need to revisit.

And, you know, with clients, once you know it's established, it's really working with their advisors as well.

You are a team and take the team approach and hopefully that then covers all the bases.

You make sure things are updated as necessary.

MILLER: Chris, tell us what documents should be in place for a well thought out estate plan.

BUTTRESS: Well, typically when we talk to clients about estate planning, we talk about a will.

We may talk about a trust agreement, depending on their circumstances.

We talk about a durable general power of attorney.

We talk about a health care power of attorney and a living will.

And the health care power of attorney and living will have nothing to do with financial matters, they have to do with medical decision making.

A health care power of attorney applies any time I don't have the ability to make my own medical decisions.

And older people often times understand the importance of those documents., but any adult really should have a health care power of attorney, and if they like, a living will.

MILLER: I watch CET all the time, I love their programing.

My family enjoys it.

I want to make a gift to CET or another charity.

I write a check, I send it to them.

Is that a planned gift or are we talking about something a little more complex than simply writing a check?

BUTTRESS: Well, that check can be a planned gift, but a planned gift really involves thinking through the goals and objectives of the organization, as well as your own personal goals and objectives.

And understanding that it can be more cost effective to use certain vehicles, for example, giving appreciated stock.

The charity gets the whole value of the stock and you didn't have to report any capital gains.

Using IRA dollars can be cost effective because those would be taxable to you, but not to the charitable organization.

So there are many things during your lifetime that might be a planned gift or it might be something that comes into play upon your passing.

It might be provided under your will, your trust agreement, again, an IRA beneficiary designation, a life insurance beneficiary designation.

There are many vehicles out there and it's really important to understand which vehicle is best suited for your circumstances.

MILLER: What are some of the decision points in those documents?

Who do people need to think about having appointed for their planning issues?

BUTTRESS: Well, some of the documents relate to lifetime matters.

So health care decisions, you know, who is it that you want to make health care decisions for you if you can't make those decisions for yourself?

And older individuals are very aware that they may lose that ability.

But those of us who aren't that old or even very young individuals, someone could be injured or in an automobile accident and need to have someone make decisions for them.

So it's important to have not just a primary person, but backup people named so that there's always someone available.

With a general power of attorney, you're looking at somebody making business decisions for you.

And that may not be the same person who's best suited to make health care decisions.

And those are things that occur during your lifetime.

In a will you name an executor, the person who will take charge of your property, make sure your debts and expenses are paid, and make sure that what's left passes to the appropriate individuals.

If you have a trust, you have a trustee who acts for you.

And again, that person may know everything about trust and be able to handle it themselves, but they may have to hire other people to help them, or you may choose to use a bank or trust company.

So there are a lot of different people in various roles.

If you have young children, you're concerned about who would be the guardian of your minor children until they reached the age of majority, the age of 18.

So there are a lot of different people performing different functions and it may not be the right role for each and every person.

MILLER: Jami, how do you deal with that with your clients when they come to you and say, "Well, my daughter's pretty smart, she should do it."

Or "My son's pretty smart, he should do it."

Or "My Uncle Bill was the executor of his mother's estate and maybe he should do it because he has the experience."

How do you talk to people about the proper appointments within those documents?

VALLANDINGHAM: You definitely need to walk through their responsibilities and the position that you're putting them in to make certain that, number one, they are capable of handling it.

And number two, also that they can follow it through, that they will make certain that they're following your directives in the end, because it is very important.

The person that you select, as Chris indicated, it can be multiple people in every situation and each one of those different documents you have.

But it is very important to make sure that they understand the person that -- They being the person that you have designated -- they understand their responsibilities because they can be great responsibility.

MILLER: You know, as a banker, I like to talk about money.

And one thing that hits me as we're talking is the fact that you both charge for your services, I presume, right, Jami?

VALLANDINGHAM: Yes.

MILLER: Chris, right?

BUTTRESS: Yes, definitely.

MILLER: Is that an impediment for some people?

Do they think it's just way too expensive and "I don't need to spend the money on that, because it's just a bunch of papers and a couple of conversations"?

But, "Boy, you know, those lawyers and those accountants, they charge an awful lot."

How do you respond to that, Jami?

VALLANDINGHAM: Yeah, and that is a good point, Mike.

That is something that does kind of stand in the way of it.

However, if you really think about the impact that you have by getting everything in line before you do pass, the amount of money that can be saved in the long run from an estate perspective, it's really well worth it.

And again, it does help out your family, if you can take care of most of those things ahead of time, it's well worth the fees that are paid and the time that is spent to do it.

MILLER: Chris, what do you think?

BUTTRESS: Definitely, I tell people, you know, you get what you pay for.

If you try to do it yourself, use a kit, try to fill in a couple of forms, in the long run you'll probably create a bigger mess and will incur more fees for your family.

And yes, it's difficult to spend money today when you expect to be around for 20, 30, 40, 50 years.

But it's really important to value the services that are provided to you and to realize what a blessing you're giving your family for planning ahead.

MILLER: Well, let's follow up on that a little bit.

You know, I know I can go online, I can get some forms, I can fill in the blanks.

And I'm a reasonably intelligent person, so I'm sure I can understand the context of what those documents are.

Why should I talk to you instead of just filling out the forms and put them in a drawer?

BUTTRESS: Well, you may be able to fill out the forms, but you probably don't understand the law behind the forms and what many of the words mean and accomplish.

It's important to fully understand what you're accomplishing by putting the words in a blank.

It's also important that the forms be properly executed, meaning signed, witnessed, notarized.

And you need guidance in helping to make the decisions that will be reflected in those forms.

Yes, people think all we do is change the names, change the date.

It's just a form.

And that's true of a lot of the language, but there are various decisions that are reflected and those decisions should be well thought out.

MILLER: Jami, what do you think?

I should fill out the forms or call Chris?

VALLANDINGHAM: No, call Chris?

Absolutely.

She is exactly right.

There are so many nuances to that.

And yes, you can go to any store or online and get those forms, but there so much more in there, state specific things as well.

That by talking to someone like Chris, she can address all of those things, in particular based on your state.

MILLER: You know, we're having a really good conversation here with an accountant and a lawyer.

When I think about my own estate planning, my own planned gift legacies, my future of my family, aren't there other professionals that I should be talking to?

And how do we coordinate conversations with the various professionals that might be involved in these planning activities?

Jami?

VALLANDINGHAM: Yeah, so certainly your advisor, your investment advisor is one.

And really, you know, we kind of shoot to have a team approach to most all of this because it is important.

There are things that you may not, as you're trying to learn and work through this process, may not really occur to you.

But because the professionals that you have engaged, they've been down the road before and they've seen a lot of these things, so they can bring those to the forefront as well.

MILLER: Chris?

BUTTRESS: Well, it's important that whoever you work with, whether it's an accountant, an attorney, a financial adviser, a trust advisor, an insurance advisor, that they all communicate with one another.

What we don't know can hurt us, so working together is really very important.

MILLER: Yeah, I do know from our wealth management group's perspective that one of the initial things we do with people is we want to know who their lawyer is, we want to know who their accountant is, we want to know if they have a financial planner, their insurance agent, their broker.

You name the professional, we want to coordinate the team to make sure that everybody's doing what's best for that client.

Chris, you and I have known each other for a long time.

We've been friends for probably 30 years now.

One of the things I've always liked that you do with this subject is you talk about different phases, different times in people's lives and how they view those times in their lives from a planning perspective.

Can you tell us a little bit about, you know, your concept of the working years, the retirement years, and the doting years?

BUTTRESS: Well, it even starts before that, Mike.

Eighteen is the age of majority in Ohio, so technically, an 18 year old could have estate planning documents.

And so more and more when children are going off to college, their parents are calling us and saying, "You know, my kids need powers of attorney.

They need a health care power.

They need a living will."

And then when people are working, they're trying to accumulate wealth and they may have young children.

So their focus is on guardianship and things like that.

And as they become more established and have more assets, then they're concerned about protecting those assets, maybe putting them in trust for their children.

And as people, you know, the doting years I'm referring to is, you know, as people live like longer, we have a greater likelihood that we're going to reach a point in our lives when we're really not able to make all of our financial and medical decisions ourselves.

So having the appropriate documents in place, having the appropriate people identified is very important to our health, security, and well-being for as long as we're here.

MILLER: Jami, have you ever had a client that had to deal with their elderly parents?

And have you -- how do you talk to somebody and help them to approach those parents in what, as Chris said, as the doting years of the maybe toward the end of the life?

How do you approach that subject with somebody?

VALLANDINGHAM: Yeah, and that is very difficult.

As we all know, the older generations talked less and less about their financial situation.

That was just something that was off, it was just off the radar.

You weren't allowed to bring it up.

So it is difficult.

And really, it's more so helping them to kind of outline some of the questions that they should talk about and really just trying to encourage them and provide some guidance, some of those things that they can approach the conversation with.

MILLER: And Chris, on the other end of it, how do you -- I have a 32 year old son, a 30 year old daughter, and a granddaughter now.

And what's the best approach to a younger couple who hasn't really thought about this, but probably has heard or read something and knows they need some planning, but just not sure how to approach it.

How do you have that discussion with somebody?

BUTTRESS: Well, it's it's part of being a responsible adult.

Particularly when people have young children, usually the idea of if something happened to them, making sure that there is someone to take care of the child, personally making decisions for the child, the idea of guardianship.

But also having a financial structure, maybe a trust to provide for the child.

You know, it's interesting, many people will do an estate plan when their children are young.

And when you're planning for toddlers, it's one thing.

And then some of those clients come back to me 15 or 20 years later.

We've had a number of those this year.

I think COVID kind of encouraged people to look at things and the number of plans that we have that are 20 years old and those documents don't make sense any longer.

You're not providing for young children.

You're providing for adult children.

VALLANDINGHAM: And Chris, it's funny hat you say that.

Until about three years ago, my brother and I were still supposed to go live with my uncle if something happened to my parents, so that we kind of outlived that.

MILLER: Does he have a pool?

You know?

Hey, maybe you should.

VALLANDINGHAM: Right, exactly.

He pays the bills.

MILLER: So, I get from our conversation that communication is incredibly important at all levels.

One thing we really haven't touched on though, is how about communication with that community or a charitable entity that you want to leave a legacy for orengage with currently?

What's the best approach with those public organizations?

BUTTRESS: Well, I think if you want to support an organization, the best approach is to talk to some representative there to see what's important to the organization, what their needs are, to make sure that you properly designate whatever you're doing, whether it's just for general use or a particular purpose.

I had a client recently who carried it to the extreme in that there was a lot of back and forth with the organization in terms of the amount they were going to give, how it would be used, how it should be invested.

But they're your dollars, so it has to make sense for you.

But it doesn't make sense to give funds to an organization for a purpose that isn't consistent with their mission or their vision.

MILLER: Jami, what about you?

VALLANDINGHAM: Yeah, I think Chris hit it head on as far as, you know, working with those organizations, they, a lot of times the organizations have a planned giving a group that you can work with and kind of walk through what you are thinking and whether or not that aligns.

MILLER: Okay, you know, I do have to tell you that while you've both been talking, I've been using my time wisely and I filled out my Personal Estate Planning Guide that I got from CET.

What's my next step with this?

What do I do with the booklet?

What do I do with the information that I put in that booklet?

Jami?

VALLANDINGHAM: I think first, number one, you need to make sure that someone knows where it is, if that's the document where you've gathered everything.

And then at that point, you can start working with your attorney, your other advisors, your CPAs, your investment advisor, trust advisors, whomever it is that you have on your team, so that everything -- or you need to create that team.

Because at this point, if you're just now completing that booklet and really thinking about it, maybe you're ready to assemble the team.

So a lot of times that's talking to your friends, neighbors, whomever, to see who they may refer you to.

MILLER: And I presume that before I put somebody's name in this book, I probably ought to have a conversation with them, Chris?

BUTTRESS: That's wise, Mike.

You know, it's -- I tell people too, sometimes they're trying to choose between children in terms of assigning roles.

And I said, "It's the good news and the bad news.

You know, the good news is you're the chosen one.

The bad news is you get all the responsibility that goes with it.

So, you know, part of it is, are you ready to be responsible for that role?

Is it something you're comfortable with?"

It's important.

You can't just throw it at somebody and expect them to do a good job.

MILLER: Well, I'll tell you, it looks like our time is up.

Thank you, Chris and Jami, for an engaging conversation, and thank you for joining us online.

We'll be back to wrap up our event with a live Q&A session.

MILLER: Welcome to the live Q&A portion of our program.

Chris, Jami, and I are proud volunteers and believe in the power of Public Television.

We had a great time creating this seminar.

The three of us are back live in the studio and are available to answer your questions.

Please enter yours in the text box below.

Here's the first question: MILLER: Chris, what do you think?

BUTTRESS: Well, the two most important documents to give to your family members currently are your health care power of attorney and your living will.

Those are the documents, the more people who know about them, know you have them, know who's named in them the better.

The other documents usually can wait until a later point in time.

MILLER: And, Chris, when you, for Jami too, when you drop these documents off with your family, of course, you want to go through them, don't you?

BUTTRESS: Well, I think it's important that they understand the reason you're giving them to them, and if they have a role under the document, what that role is.

You know, are they the primary person named, are they a backup person, and really what the purpose of the document is?

MILLER: Okay.

Next question: MILLER: Sounds like me.

Jami, what do you think?

VALLANDINGHAM: So I think really, you just start with the information that you do have and just kind of work yourself backwards.

You know, what are the things that you can remember that you've done, then try to find them.

If you remember companies that you've purchased things from, anything that you can recall, just start there.

You've got to start somewhere, so anything that you do know, that's where you should begin.

MILLER: And I presume a conversation with a professional, you know, accountant, attorney would be a good place to start to kind of get an idea of what to be looking for, right, Chris?

BUTTRESS: Oh, definitely.

I think, you know, as you get information that leads you to more information.

So and it may be some of this you have information you don't even realize you have.

There should be contact information, phone numbers, email addresses and so on on various materials that you have.

MILLER: Okay.

Next question: MILLER: Jami?

VALLANDINGHAM: I tell you, Mike, it really does depend.

What type of policy is it?

What is the intent of that policy?

So you really do need to kind of step through what is there, talk with the professional, have someone take a look at the document and see is it really worth hanging on to at this point?

MILLER: Okay, because there are a lot of alternatives with it depending on the type of policy, correct?

VALLANDINGHAM: Absolutely.

You can swap those out for another type of policy, but certainly anyone that can review that for you can give you the alternatives that are available.

MILLER: Okay, thanks.

Lisa wants to know: MILLER: Chris?

BUTTRESS: I probably wouldn't add the children to the deed currently to give them a current ownership interest in the property.

It's your property and you want to be able to control it.

There are ways to add the children as beneficiaries to the property.

For example, Ohio has the concept of a transfer on death affidavit with respect to real estate.

Kentucky does not, though.

So it's a state by state item.

MILLER: Rebecca, as a question: MILLER: Chris?

BUTTRESS: Well, when a person passes, if there is someone named as a beneficiary, yes, they need to be notified.

Also, next of kin need to be notified.

So even if you're not in current contact with those individuals, it's important that the people you're leaving behind, your advisors, are aware of the individual's existence and hopefully their current address.

MILLER: Kelly wants to know: MILER: Jami?

VALLANDINGHAM: Yes, absolutely, you should go ahead and make plans.

Anything that you can do ahead of time is certainly helpful.

As far as how do you start, at that point, you really are looking for some type of a professional to deal with that can help you start down this path and get all of your information together.

MILLER: Gena has a question: MILLER: Chris?

BUTTRESS: It really depends on the type of trust.

There are many different types of trusts and there are different reasons for having trusts.

So the question really has multiple aspects to it.

Long term care and paying for the cost of long term care and claims for that cost when someone passes is a totally different aspect than much of the planning that's done involving trusts.

MILLER: Jami, what do you think?

VALLANDINGHAM: Yes, I agree.

There certainly are -- The type of trust that you have certainly can have an impact on that.

So knowing what that is and, again, we'll say it continually here, is that you need to talk to your professional adviser, your attorney, to make sure that it is the right type of trust.

MILLER: Yeah, that question goes a little bit to Medicaid planning.

And I know that is a very specialized area of the law that, you know, only certain practitioners really delve into.

So, if it is a situation with the nursing home with gifts made over a period of years, you really want to make sure you have the right professionals.

Gena has another question: MILLER: I think maybe can they attack that?

MILLER: Chris?

BUTTRESS: Well, whether the assets automatically pass to your spouse depends on the type of asset.

For example, there are certain kinds of retirement accounts that have to go to the spouse, unless the spouse consents to a different beneficiary.

But under the law, there are provisions that determine who receives a person's property if they die without a wil.

It may be the spouse.

It may be a combination of spouse and children, and it depends upon whether the spouse is also the parent of the children.

So in many families, it's a yours, mine, and ours situation or a yours and mine situation.

And in that case, everything isn't going to necessarily pass to the spouse.

MILLER: So, Chris, what I heard you say was that the law, and I assume this is different in different jurisdictions, but the law creates an estate plan if you don't have the right documents in place and you're not going to have a choice, unless you do plan with the right documents.

Is that correct?

BUTTRESS: That is correct.

The law makes assumptions as to who you would want to receive your assets, and it varies from state to state.

You know, in Ohio currently, if there's a surviving spouse and the children are the children of both the deceased spouse and the surviving spouse, everything would pass to the spouse.

But that hasn't always been the case.

MILLER: Jami, I assume you get into situations with the yours, mine, and ours scenario.

VALLANDINGHAM: Yes, absolutely, it happens quite frequently.

And, you know, you certainly want to make sure that you're checking that, you're checking beneficiaries on different policies, as well as what your will states to make sure everything does correspond the way that it should.

MILLER: Okay.

You know, this might be a good time to throw something in the mix.

The difference between probate and non-probate.

You know, certain assets pass pursuant to a will, but not everything does, right, Chris?

BUTTRESS: That is correct.

For example, a life insurance policy passes to the beneficiary you name.

A retirement account passes to the beneficiary you name.

You may own a piece of real estate jointly with right of survivorship with a spouse or some other individual.

And that passes to the survivor by the terms of the deed.

Those items are commonly referred to as non-probate items.

They're not controlled by the terms of your will.

Your will controls those items that are titled in your name alone without any type of beneficiary designation.

And is it is the will that is admitted to probate and those are the probate assets, the ones that are controlled by the will.

MILLER: Okay.

And this next question from Amanda kind of gets to to that issue, too, about how things transfer.

She asks: MILLER: Jami?

VALLANDINGHAM: Yeah, so as Chris referred, some of the things you do need to make sure that you have outlined as to who they should go to, and then in that case then that would protect prior or post the marriage that you're speaking about.

MILLER: And, Chris, there are different types of states, community property states versus non-community, you know.

Can you explain a little bit about that, how that affects the transfer of property?

BUTTRESS: Well, each state has its own set of laws.

And the rights of a spouse may be different under the laws of that state.

Most of the states are not community property states.

So the titling of property in the name of one spouse or the other may determine who owns it.

In community property states titling isn't always the answer.

It's a question.

I'm not a community property state attorney, but it's a question of whether those were assets of the marriage and the marriage assets are considered community property assets.

So there are things that relate to titling.

There are things that relate to sometimes people have prenuptial agreements that clearly specify assets that existed prior to the marriage versus those of the marriage.

All of these things are part of the picture that has to be completed in order to have an effective estate plan.

MILLER: Question from Kathleen, and this is a good one: MILLER: Lucky kid.

MILLER: Jami?

VALLANDINGHAM: You do want to consider the majority, and certainly as a three year old, they are a minor.

So you'll need to have someone that can take care of that until they do reach that age when you feel as if they can then take over all of those assets.

I'm sure Chris has other other stipulations to add to that since she drafts all those documents.

MILLER: That's right.

Chris, what other considerations?

BUTTRESS: Well, part of it is the amount of money involved and what's your intent in terms of how that money is to be used?

Are you thinking of it being used for educational purposes?

Are you thinking of it as providing a nest egg for that grandchild?

All of those things enter into the picture.

So sometimes people set up very long term trusts.

Sometimes it's until age 25, age 30, age 35, whatever seems appropriate based on the dollar amount and the intent for the use of the funds.

MILLER: And of course there are other alternatives for educational expenses, 529 plans and the like, which different banks, different brokerage houses offer.

So the next question: MILLER: Chris, this is right down your alley.

BUTTRESS: Well, it depends upon, number one, how old the will is and what the items are that you're updating, how extensive they are.

Oftentimes, if it's simply adding an additional successor, executor, or something like that, it may be fine to do it by codicil.

But one of the difficulties is when people keep making little changes, you end up with a will and three codicils and it can be very confusing.

So at some point, incorporating all of that into a single new will document may be more long term cost effective.

MILLER: Here's a good one from Kate: MILLER: So, Jami, what do you think?

VALLANDINGHAM: I think she needs to find an attorney to work with to, if they want to stick with those documents, to at least have them review those, especially considering the state specific items.

Otherwise, they may just get to start from scratch.

MILLER: Chris, I know you have an opinion on fill in the blank wills.

BUTTRESS: I would not advise that anyone use them.

And it's not just because I'm in the business of preparing wills, but people often times don't understand really what those filling in the blanks means.

And as Jami said, it's very state specific, the law is, not just in terms of the meaning of the words, but the process and the way the will needs to be signed and executed.

MILLER: Okay.

James asks a question: MILLER: Chris?

BUTTRESS: Well, guardianship is a concept that applies, in this case, I'm guessing, really to minors, someone under the age of majority.

In Ohio, that's age 18.

So the guardianship would, of the assets, the guardianship of the estate only continues to age 18.

There are other ways to control benefits to younger beneficiaries who are legally adults.

I typically call the people between the ages of 18 and 25 as the technical adults.

Technically, they're adults, but many times if a parent or grandparent wants to provide a financial benefit, they want to control it to a later age and be more protective.

MILLER: Raise your hand if you've raised teenagers and you know what a technical adult is, because I do.

BUTTRESS: As do I, Mike, as do I. MILLER: That's right.

And that that also goes to the point when you're talking about guardianships, people hear the concept of guardian of the estate and guardian of the person.

Quickly, Jami, can you tell us the difference between those two?

VALLANDINGHAM: So the guardian being just a parent that's taking care of that child, or there can be another person in place that takes care of the legal side of things.

MILLER: Okay, and then the financial side also.

Right.

Okay.

Joyce has a question: MILER: Jami?

VALLANDINGHAM: It depends on how responsible they are, these technical adults that we were just talking about.

Do you want to just give them the money outright or would you like to put some protections in place?

So really, it just comes down to what's the situation that you're in.

MILLER: And, Chris, in those situations, it really does depend on the child, right, the young adult, what they know financially, how emotionally strong they might be.

What are some of the other considerations people need to think about?

BUTTRESS: Well, the other thing is, even if the person themself is fairly responsible, if other people learn that they've come into this money, it can put them in a difficult situation.

So often times, you know, we do use trusts for those kinds of situations.

So it doesn't mean that the grandchild wouldn't have any access to the funds.

But it's distributed on a more controlled basis and hopefully produces a better long term result.

MILLER: Okay.

Next question: MILLER: Jami?

VALLANDINGHAM: First, you have to start with some sort of an appraisal of the other things that are not just flat out cash, that one's very easy.

All other items, you know, it's things that are on the stock exchange, stocks.

Those are easy to come up with the value.

But a house may not be the case.

A rental property may not be the case with that.

So a lot of times you do have to have a true appraisal done so that you really do know the values that you're splitting amongst everyone.

MILLER: Chris?

BUTTRESS: Oftentimes, documents like a will will deal with classes of assets separately.

So real estate may be dealt with separately, meaning it may say that the real estate passes equally to the individuals involved.

Tangible personal property, the things that we own, furniture or household goods, jewelry, cars, those are tangible items that may be a category unto itself.

And it's that category that's divided equally.

And then we have cash and financial assets, like investments and securities, that are readily valued on an exchange.

MILLER: What about a circumstance where one of the beneficiaries has borrowed from mom and dad during their lifetime?

Can that be considered an asset that can be used in the equalization?

BUTTRESS: Definitely, if money is owed to a parent, that amount is considered an asset of the parent's estate.

And typically that amount would be distributed to the person who owes the money, which makes the debt disappear, but then other assets would be distributed to the other beneficiaries in a comparable amount.

MILLER: All right.

Carol has a question: MILLER: Jami, does she need to trust?

VALLANDINGHAM: Possibly.

MILLER: Okay.

VALLANDINGHAM: Like most of these questions, it really does depend on your circumstances.

MILLER: Okay.

Chris, I know the answer is yes, but -- or maybe, I should say.

BUTTRESS: The answer, yeah, the answer is maybe.

You know, all of this, we ask a lot of questions of our clients and they get a little annoyed sometimes.

But the advice we give is only as good as the information on which it's based.

And usually there's not a simple answer.

It's not one size fits all.

It depends on your goals and objectives.

MILLER: John asks: MILLER: Chris?

BUTTRESS: Yes, a trust executed in Michigan is going to be valid in Ohio.

States have to give full faith and credit to the laws of other states.

Now, will it work as well in Ohio as it did in Michigan?

Possibly, possibly not.

So whenever people move from one state to another, it's a good idea to at least have their plan reviewed.

MILLER: And then people with vacation homes and things could possibly have trust in different jurisdictions, correct?

BUTTRESS: Definitely.

MILLER: Next question: MILLER: Jami?

VALLANDINGHAM: So your estate is what happens after you pass, a trust is an instrument that you can set up prior to and have rules placed around that, what you want to happen to the assets that are part of that trust, then again, as you pass, then that's your estate that is then holding everything that you had.

MILLER: Okay.

Chris, for the most part, I don't want to speak for everybody, but if you have any property: a car, a house, a bank account, a share of stock, clothes, TVs, you have an estate, correct?

BUTTRESS: If you own anything, you have an estate.

MILLER: Ken wants to know: BUTTRESS: Mike, that really touches on an item that you mentioned earlier, which is, you know, sort of Medicaid planning, long term care planning, and really requires the advice of an attorney who does that specific type of planning.

So I think it really goes beyond the scope of this presentation.

MILLER: Good question here: MILLER: Jami?

VALLANDINGHAM: So, you start out really by a reference, trying to get someone that someone else has experience with, that they can help you to make that connection.

And then you really do need to sit down and talk to them before you truly engage so that you make certain that you're comfortable they're asking questions that you think are pertinent to try to get you to the point where you want to be.

That is -- that establishing that relationship is quite important.

MILLER: Okay.

Chris?

BUTTRESS: You want someone with appropriate professional credentials, whether it's an attorney, accountant, or whomever.

So you want somebody who's competent to do the work, but you also want someone, as Jami mentioned, someone you're comfortable with, someone with whom you have a personal rapport.

So you could have the most qualified professional in the world, but if you had difficulty communicating with them, it just wouldn't be a good fit.

MILLER: Chris, for attorneys especially, what do you think about calling the bar association in whatever county in which you reside to get referrals for appropriate probate and trust lawyers?

BUTTRESS: I mean, that may be a good answer in some counties, but I think there are many people who don't participate, many attorneys who don't participate in those kinds of programs, they don't appear on those kinds of lists.

So as Jami mentioned, getting referrals from other people that you know, talking to other professionals.

For example, accountants work with attorneys, attorneys work with accountants, they work with investment advisers.

So anyone you know in the professional arena can help you get started in finding other professionals to help you with your planning.

MILLER: Yeah, I think it's like hiring a professional to do anything, you want to get referrals.

You want to know what people's experience has been with those those professionals.

I think as we talked about in our seminar presentation, you know, it's the team that really makes the difference when it comes to appropriate estate planning.

You want to have the lawyer, the accountant, the financial planning professional, the investment advisor all on the same page.

And that's one of the sources for those professional referrals.

James has a question.

I think we touched on this before, but I think we need to clarify a little bit.

MILLER: Chris?

BUTTRESS: Yes, unless the beneficiary designation names the estate or the trust.

So, you can have a beneficiary designation that says pay to my estate or pay to my trust, in that case, the will and trust provisions would be applicable.

But if the beneficiary is my spouse, then it's going to go to my spouse and it doesn't matter what my will or trust says.

MILLER: All right, Jame, so I have insurance policies at a couple of different companies, and I've failed for years to put the proper beneficiary designation on them.

What happens?

VALLANDINGHAM: They're going to go to who you have as the beneficiary.

MILLER: If you don't have a beneficiary, Chris?

BUTTRESS: The policy will say where it goes and sometimes it will say it goes to your estate.

Other times it will list next of kin.

It might say if you have a spouse, it goes to your spouse.

If you don't have a spouse, but you have children, it goes equally to your children.

It really depends on the terms of the policy.

MILLER: Okay.

And that refers back to that estate planning booklet that's available from CET, where you can kind of go through all of the property and all of the the financial and estate planning issues that you have andreally get a handle on what you should be looking for to make sure all those periods are there and all the I's are dotted and the T's are crossed.

Good question for you, Chris: BUTTRESS: I have no clue the average cost in the Cincinnati area.

You know, I -- MILLER: What's the average cost in your office?

BUTTRESS: Well, you know, and I can't even tell you the average cost in my office.

It is all very fact specific to the person's circumstances in terms of the documents that are being prepared.

You know, if there -- Is it a will, is it a trust, is it a power of attorney?

Is it a health care power?

Is it a living will?

If people are concerned about cost, they can certainly call and talk to an attorney, give the attorney some basic information, and that attorney will give them a range of what to expect in terms of cost.

MILLER: And so is it fair to say that when you hire an attorney, you are going to get, hopefully, some documents that, you know, the will, the trust, the powers documents that are appropriate, but you're also getting the value of the experience of that person to apply to your own personal situation, right, Chris?

It's not as easy is as buying a car or going to Home Depot and buying some lumber.

BUTTRESS: You're getting access to professional advice.

MILLER: Right.

BUTTRESS: And that advice is only going to be as good as the information that you provide the attorney.

So the more information the attorney has, the more complete the advice is going to be.

MILLER: Jami, I'm sure you see the same thing as an accountant.

VALLANDINGHAM: Absolutely.

You know, there certainly is something to be said for the professionals in an office because you do rely on each other as well.

And there's vast experience there and that comes into play.

MILLER: Chris, what do you think of getting a second opinion when you get an attorney's -- you have a consultation?

Is it like medicine where you might get a second opinion?

BUTTRESS: It may be.

I mean, if you feel uncomfortable with the advice that's being given to you, the recommendation that's being made, you may ask for a second opinion.

I recently had that happen with a client who had moved out of state and was consulting with an attorney in the new state and just didn't feel comfortable with the advice that was being given.

MILLER: Sometimes, Chris, when when somebody comes to a lawyer, or Jami, this I'm sure happens with accountants also.

People sometimes don't want to have a full conversation, they want to hold back some information.

How important is it for a professional to have absolutely all the information before they render an opinion?

Chris?

BUTTRESS: It's very important.

I mean, what you don't know can hurt you.

And that's why, again, I said earlier, we ask a lot of questions.

The advice we give is only as good as the information on which it's based.

You know, if somebody doesn't tell us that this person that they're referring to as a child legally isn't their child, they're just referring to them as a child, or maybe it's a stepchild, or there's just so many different things that could come into play.

So the more information we have, the better.

MILLER: Jami, I assume you agree with that.

VALLANDINGHAM: Yeah, I would also add to that, that's why it's really nice to have a team, because Chris may know something, I may know something, you may know something that they may just inadvertently not tell us.

But it has struck a chord with us that it's very important to what we're trying to achieve.

So we need to make sure that everyone's on the same page and knows what that is.

We absolutely need to know the facts.

MILLER: Here's a good question from Steve: MILLER: Chris?

BUTTRESS: That's a tough one.

So, there may be friends in your age group, you may have some professional advisers may be willing to perform that role.

There is at least one local organization that provides that service to individuals.

So, again, it varies from location to location and from circumstance to circumstance.

MILLER: And I do know that under limited circumstances, some financial institutions, through their trust departments will take on the role of attorney in fact for financial matters.

So, you know that's a good question and you really need professional help with that.

Next question from Janice: MILLER: We talked about how you search for a professional, how you search for the lawyer, how you search for an accountant based on trust, based on what other people's experience has been.

What is the first step?

Chris?

BUTTRESS: Well, for some people, it's Google, you know.

But I think, you know, probably before I would resort to that, you know, I would talk to friends and family to see whether they've had any experience with attorneys or accountants or financial advisors, either good or bad.

And Mike, you had mentioned the bar association earlier.

For example, in Ohio, the State Bar Association has a program of where people are tested to be specialists in the estate planning and probate area.

I mean, you can go to the website and find lists of those individuals.

So there are, you know, there are resources out there.

You can get them.

So I think that's -- part of it is doing your homework and maybe you find a list of several people that you contact and have a conversation with.

MILLER: Yeah.

And one other resource that I'll put in a plug for, bank trust departments.

But if they're are good department, if they have good professional people, they can be a resource for the right planning, lawyers, accountants, those kind of people.

So that's another place to look.

MILLER: Chris?

BUTTRESS: Well, I think we talked about that already as it relates to powers of attorney.

And if you're talking about the trustee role, you can go to a bank or trust company.

I mean, that's their business.

They are in the business of being trustee.

So sometimes even when there are family members, a bank or trust company is involved.

MILLER: Here's a good question from James: MILLER: Jami?

VALLANDINGHAM: So as a donor-advised fund, and you are the donor, you are in an advisory position, whomever is holding those funds is in the ultimate position.

As far as what happens if it goes belly up, I don't know that I know the answer to that.

Chris, do you know?

BUTTRESS: If it goes belly up, they're gone?

VALLANDINGHAM: Yeah.

BUTTRESS: Then I mean, they're not your -- They're not your funds once you've contributed them to the donor-advised fund.

MILLER: Yes, that's true.

Next question: MILLER: I think the answer to that is yes.

It's, I don't think, a good idea to let the same people that are taking care of the kids have sole control of the money for their benefit.

Sometimes choices are made that aren't quite appropriate in terms of maybe I need a bigger house, maybe I need a better car, maybe I need -- When it really should be about what's best for the kids.

Chris, what do you think about that?

BUTTRESS: I would tend to agree with you, Mike.

You know, sometimes the people who are best suited to make the day to day decisions on where your children go to school and the medical care they receive and all of that are different from the people who are best suited to manage the finances.

MILLER: Chris wants to know.

Common law marriage depends on the jurisdiction, right?

BUTTRESS: It does.

And I can't -- I don't profess to be an expert on common law marriage.

MILLER: Okay.

MILLER: It depends on the assets.

It depends on the circumstances.

It depends on what you want to accomplish, right, Chris?

BUTTRESS: That's correct, Mike.

I mean, you have a conversation with an attorney who practices law in the area and determine whether your goals and objectives can be met without a trust or require a trust agreement in order to do that.

MILLER: So, Jami, you agree the professional advice is really the key to knowing what to do and how to do it and when to do it and where to do it and all those things?

VALLANDINGHAM: Absolutely, and like we've said to so many of these questions that have been asked, everything, it depends.

It really just boils down to it depends.

So you do need that professional that's guiding you to make those right decisions.

MILLER: Next question: MILLER: Rebecca wants to know.

Chris?

BUTTRESS: It depends on the value.

And Ohio doesn't technically doesn't have an estate tax or an inheritance tax.

Kentucky has an inheritance tax and it depends on the relationship of the parties.

I'm guessing that the person is asking about estate tax more broadly, the federal estate tax, which right now has avery high exemption amount, which is likely to come down.

But if you own a substantial 401k, it would be part of the calculation of the assets on which that tax would be based.

MILLER: Rebecca didn't ask, but what about gift taxes?

What about what's the threshold now for gift taxes?

BUTTRESS: Well, right now it's the same as it is for estate tax.

MILLER: Okay, but there's a -- BUTTRESS: The annual amount -- MILLER: The annual amount without filing a gift tax return.

BUTTRESS: Annually you can give, each donor can give each donee up to $15,000 per year within what's called the annual exclusion.

MILLER: Right, okay.

And that's been going up every year.

Well, almost every year.

BUTTRESS: It has been indexed, but it hasn't gone up for a few years.

MILLER: Okay.

Next question: BUTTRESS: Well, Mike, there's several questions there.

MILLER: There are.

BUTTRESS: So, if there's a mortgage on the house, the inheritor doesn't assume the mortgage, unless the bank allows that to occur.

I mean, typically, the mortgage is going to need to be paid because it is a debt of the person who has passed.

MILLER: We're going to have one more question here from Pat.

MILLER: So, I assume she means in a will?

BUTTRESS: Well, often times the trust is the beneficiary.

It might be the beneficiary of a life insurance policy.

It could be the beneficiary of a retirement account, maybe slightly less likely.

It could be the transfer on death beneficiary of other assets.

So, again, it all depends upon the circumstances and what we're talking about asset wise and who you're trying to benefit with those assets.

MILLER: Okay.

Jami?

VALLANDINGHAM: I agree with Chris, again, it all depends.

MILLER: Okay.

Well, that's our last question.

And we really want to thank all of you for watching our seminar and for being part of the question and answer session and for your commitment and your interest in CET.

Chris, Jami, and I really appreciated being asked to do this and had a good time.

Hopefully the information you received was was helpful.

Thank you and have a good evening.

LENSMAN: That concludes our estate planning discussion.

Thank you to Chris, Jami, and Mike for your time and expertise and thank you for joining us online.

For additional information on planned giving, please visit our websites.

We hope that you plant the seed for you, your family, and your legacy.

Have a great night.

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