Episode 14

March 10, 2023


#28 | Otto Shill | Emotional Legal Decisions Part 3 (Money Matters)

Hosted by

Tony Siebers Bina Colman
#28 | Otto Shill | Emotional Legal Decisions Part 3 (Money Matters)
Parent Projects - Aging In America
#28 | Otto Shill | Emotional Legal Decisions Part 3 (Money Matters)

Mar 10 2023 | 00:52:05


Show Notes

For more than 30 years, Mr. Shill has helped businesses, business owners, and individuals comply with tax and other government regulations, navigate government investigations, and build wealth through business transactions and long-term business and estate planning. He has significant experience in business transactions, federal and state tax compliance and tax controversies, compensation and employee benefits, employment regulation, and government contracting compliance and disputes.

Jennings Strouss leverages our unparalleled legal knowledge and business experience to provide individuals and businesses with expert counsel on estate planning, estate administration, and probate matters. We pride ourselves on being astute problem solvers and are only satisfied when our clients are happy. Our attorneys handle all aspects of estate planning and probate, including the implementation of sophisticated estate plans for clients, such as the drafting of traditional and complex wills, various types of revocable and irrevocable trust agreements, and family partnership agreements. They also assist in the preparation of trust documents, including living trusts, marital deduction and generation-skipping transfer tax trusts, irrevocable life insurance trusts, trusts designed for facilitating gifts to minors, and specialty trusts.

Looking for information? Parent Projects takes the stress and intimidation out of the process for families relocating an aged loved one using our educational and self-help downsizing guides found at www.parentprojects.com. Through our “Verified” Business Network, advocates can access the pre-screened professional services they need on their terms with the financial and personal safety peace-of-mind their families deserve.

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00:00 – Intro

01:20 – Intro to Otto Shill

04:06 – Types of Legal Decisions

21:31 – Parent Projects Connect Ad

23:01 – What is a Fiduciary

32:53 – Tour of Sky Song Ad

34:04 – Basics of Contracts

39:22 – What Should We be Thinking About When Reading a Contract?

49:51 – Wrap Up

50:46 – Outro

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Episode Transcript

Speaker 1 00:00:08 You're listening to parent projects, Speaker 2 00:00:12 You got a lot that's coming at you. Uh, and as part of making the mini decisions and when to push in, you've got some serious emotional legal decisions that have to be made. And I'm happy to be back here. We've got week or session number three and segment three on this, where we're gonna focus on the money matters that have to do with these types of decisions in your parent project. We're gonna break down estate planning 1 0 1 fiduciary roles in your parent project, healthy contract management. If that's something you haven't done before, and you just got a lot of that that's coming at you, we sit down with Auto Shell of Jenning, Strauss, and Salmon. Again here for emotional legal decisions. Part three, money Matters. Stay tuned. Speaker 1 00:01:10 You're listening to Parent Projects, a family Media and Technology Group Production. Now, here's your host, Tony Sievers. Speaker 2 00:01:20 Hey, uh, whether you are looking at the best, best ways, uh, to handle that estate, to make sure that mom and dad can go the distance, what happens after they've gone the distance, you're gonna start transferring stuff and you are just, maybe you just wanna minimize the family drama that comes around with it auto shell. Thanks for joining us today. We are gonna get into this third part of the series. We are gonna talk some money matters around those emotional legal decisions. And we're gonna talk about from estate planning, right? All, all the way down. You're gonna talk to us about healthy contract management and the role of those and the fiduciaries, uh, that come and go throughout a, a total parent project today. Thanks for joining us and doing it. Speaker 3 00:01:58 Good morning, Tony. How are you? Speaker 2 00:02:00 Uh, just blessed. Thank you very much. So, uh, let, let's, you know, you're in, in a background real quick off of you, Jennings, Straus and Salmon and your background. For those viewers, maybe that maybe missed part one or part two, make sure you check it out off the podcast. Can you give us a, just a brief background of, of your aspect and, and how you come to look at law, uh, and, um, and what you do at Ginnings Strauss and Salmon? Speaker 3 00:02:22 Well, Jennings Trouss is one of Arizona's oldest law firms. I'm in the tax and estate planning department. I'm a certified tax specialist, and I help people with estate planning, uh, business planning, transactions, and, uh, employee benefits all day long. So, Speaker 2 00:02:38 Love it. Speaker 2 00:02:40 Let me find me. There we are <laugh> the, uh, so, um, that background, you're not, and, and tax isn't, uh, the only thing that's obviously going on from those things, but I you, you have a personal, we, we talked about a little in the first couple of rounds of this, you've had personal experiences. You had a parent project, saw it all the way through, all the way to the end, uh, times it's awesome, times, it's messy, all those types of things. I think one of the, the, um, way I probably one of the most shocking things that, that came across, I remember you just really shocking me up, was preparing yourself that at some point in time, one of those decisions you are going to make on behalf of your family member could be that it's gonna kill them, right? You're gonna make the best possible decision you could possibly do, and the sooner that you could come to grips that, that is just likely because death is, is the natural end state to this was gonna help you process through that mm-hmm. <affirmative>, Speaker 2 00:03:37 Um, that, that really helped me understand that perspective and just the totality of that perspective for you. You get the emotional side, you understand the soft touch. So I really value as a, especially as an attorney who's who's had that and can walk us through, um, estate planning, kind of estate planning 1 0 1 as someone's starting to work there, you know, it the will to the trust, advance, advanced, you know, tax planning. Can we break this down? What, what should a family be thinking about when, uh, when that first check is, does mom and dad when you're trying to assess mom and dad, can they go the distance in the first place? What are the types of legal instruments or what are the types of legal decisions we might have to make or seeds? Well, Speaker 3 00:04:19 Well, so let's, let's talk, we've talked in previous sessions a little bit about powers of attorney mm-hmm. <affirmative>, um, when mom and dad are still alive, and you have to act for them either with respect to their property or with respect to health decisions, appropriate powers of attorney to permit that are important. Um, then when mom and dad finally pass, you know, the point of their property is to take care of them while they're alive, and then if there's something left over, uh, they, they typically pass it on to to family members or others that they choose. Uh, there could be some charitable giving or other things, and that requires planning to accomplish that. So, Speaker 2 00:05:05 So some of those conversations are, which we talked about before, are probably understanding what, what's their intent on those things to, to determine what's the best way to kind of start doing that. Speaker 3 00:05:16 Yeah. Although I, I'd guess I'd add a caution here, particularly if mom and dad have decided that you are going to be the one who, who's going to be the trustee of their family trust or the personal representative of their estate. If, if, if somebody was going to decide that about me, I would wanna make sure mom and dad got to their attorney to do the planning. I probably wouldn't, I probably wouldn't wanna be in the room Speaker 2 00:05:47 And, and I is as we Sure. And that is <laugh> a good attorney. I mean, you've, you've got years of practice to put that up, but that's a great one. Putting the brakes on and, and understanding, oh, if I'm gonna be the one to carry this out, then maybe just allowing somebody else to take point on putting it together makes a lot of sense to keep things clean. Is that where you're going? Speaker 3 00:06:08 Yeah. Well, not only that, but it, it, we'll talk a little bit later about you, uh, fiduciary responsibility, uh, that one is gonna have, if they're helping take care of parents, um, in preparation for that, you want to be able to be disinterested to, to a large extent, you don't wanna be subject to the criticism that you influence something ahead of time so that you could get a result afterwards. So pretty, pretty important. And, you know, it's fine to make the arrangements. Um, I I it just probably better if mom and dad participate with their own attorney in, in the planning and you not so much. Speaker 2 00:06:51 Right, right. And, and that is, um, that, that probably leads to a, a good conversation of, um, of some of the roles of the types of people that you, that mom and dad might rely on to help put that together to work through those things. So we've got attorneys, a accountants tend to get involved. Speaker 3 00:07:09 Yeah. You're, I mean, if, if you have assets of any substance at all, you're, you're going to probably need a good accountant who can help with tax filings. You're gonna need an attorney who can help with planning both estate planning and estate tax planning, maybe gift and gift tax planning as well. You might need a good financial advisor. Um, if, if assets are more limited, you probably still need a, an at least an attorney who's well qualified to help plan for, uh, Medicaid type benefits that, that are accessible, those sorts of things. Speaker 2 00:07:47 That, that's, um, so, and, and I think one way to maybe approach this and break this down for those of you at home, uh, would be breaking, uh, we talked about breaking the estate planning kind of 1 0 1 down into what's the financial plan to make sure mom and dad can, can get to the end. Then maybe number two, talk to those professionals pushing in with how do we simplify that, that transition of whatever was excess or leftover or, or facilitate what mom and dad wanted to do after, after they'd departed if there were, if they had, you know, special wishes or, or instructions, uh, for that, for any excess, what they didn't need in their lifetime. Uh, and then the third, talking about the impact of those people against minimizing the consequences of, of tax, or how much of that was g is, you know, gonna be peeled off or to go away outside of what mom and dad wanted to do, uh, with, with that particular money? Is Speaker 3 00:08:43 That Well, sure, so for example, it, it, it really depends on how complex mom and dad's situation is. If, if mom and dad have a house, a couple of cars and an ira, and they're taking required minimum distributions to live on, and there will be some IRA money left over, a beneficiary designation takes care of a large part of the estate, you have to worry about selling the house and dispersing funds and, and the cars, but it not as much to manage. Yeah. If mom and dad have the, the more things they have, the more properties they have, the more investments they have, the more complex it gets, the more likelihood that that tax will, uh, play an or play a role. Speaker 2 00:09:30 Okay. Speaker 3 00:09:31 For example, a lot of people haven't had to worry for the past seven or eight years about estate tax or gift tax, right? Right. Because back in 2017, uh, the Congress passed the Tax Cuts and Jobs Act and the credit against gift and estate tax went to 11 million per person. So 22 million per family, and it's gone up higher than that because of the inflation adjustments. Well, in 2026, that's all returning to the $5 million level per person. That's a, that's a big gap. So right now, people are considering what planning do they deem to do now to take advantage of that credit before it's gone? And they're balancing that against income tax issues because they give up certain income tax benefits if they make big gifts now. So, um, it it, the, the landscape is changing and more families will be impacted starting in 2026 than have been in in recent memory. Speaker 2 00:10:34 So let, let's break down then. Let's talk in that planning of, as in that type of a stage there, biggest question I think we see out there, will's trust at a high level. What is that decision of will and trust? What are mom and dad if, if we're new to that and stepping in, we know they're two different ways that mom and dad manage their resources to the end, or what would happen after with those access resources kind in step one and two of, of this estate planning 1 0 1, what, what's the, what's the primary difference around that? Speaker 3 00:11:04 Well, so we're talking about vehicles that allow you to transfer assets to your heirs once you no longer have need of those assets. Okay. They're, they're two different ways to do that. Well, one, one we just talked about with a beneficiary designation, if you have a life insurance policy and a retirement plan, certain annuities, you can do a designation with that company and it will automatically pass. And you don't need to do more with that piece. Okay. You can, with a spouse, you can do joint tendency or community property with rights of survivorship, and the real estate will pass to your spouse. If your circumstance changes, your spouse dies, you get divorced, whatever, you may need to change that, that plan. Um, but, and then if, if you need to have somebody else empowered to take care of your property after you die, you can choose in, in real high level, you can choose some kind of a vehicle like a trust that allows it to be managed over time, or you can do a simple will. Speaker 3 00:12:14 Um, the, the thing to remember is a will is just a piece of paper. It needs to be signed in an appropriate way. There's really only two ways to have a valid will in Arizona. One is that it's a self approved will. It meets a certain set of statutory requirements. It's signed by the right number of independent witnesses. It's, uh, gotta be done correctly. Or you, you can have a holographic will where the dispositive provisions are in your own hand, your own handwriting. Um, I, I strongly urge people not to let mom and dad just do that alone. They need competent legal advice and, and be, because the consequences of failing to do it right can be pretty significant. Not all. And Speaker 2 00:13:04 What would they be like, what, what, what would significant consequences typically be for something for failing? Speaker 3 00:13:08 Well, for example, if you, if you, um, die without a, without a valid will, for example, and there are children of mom and children of dad and mom dies, dad's entitled to 50%, and mom's children are entitled to 50%. Whereas what mom may have intended is everything goes to dad. Yeah. Right. So you can change the inheritance scheme pretty dramatically if you don't do the documents the right way. Okay. At the end of the day though, a will is just a directive executed in the proper way, and then somebody's gotta take that to the court. The court has to order the, the provisions of will put into place. So if there's, if there's property, personal property that needs to be transferred, if there's, uh, real estate that isn't otherwise titled so that it passes automatically, that accord order has to transfer that investment accounts that don't have a beneficiary designation, the same, same sort of thing. So it it's a public process. It can be informal or it can be formal, uh, informal as, uh, just filing the right paperwork, proposing distribution schemes to heirs and, and assuming there's no fight, uh, yeah. Handing out the assets. A formal probate is a litigation proceeding, and it's usually a contested matter, but that's, that's the ban. And, Speaker 2 00:14:40 And breaking that into that litigated meaning goes to court, goes, it's something where it's likely to end up into court. You're going back and forth between attorneys, you're trying to check to, to each attorney on each side each time. That conversation happens every, every seven minutes. Right. It's, uh, yeah, to Speaker 3 00:14:54 Be, there's a lot to be clear, both proceedings are in court. Both are are public records. So theoretically, whatever you have to file with the court can be viewed by anybody who wants to go out of the court and rummage through the file. Um, and that's probably the chief disadvantage of probate. But a formal probate is actually a contested proceeding where there are attorneys on both sides, uh, trying to figure out who gets what. Okay. Um, a a comparison to that, at, at a basic level, is a living trust, which many people have. And the primary advantage of a living trust is that when you die, it doesn't. And so if you have transferred property to a trust ahead of time, then you've named a successor trustee when you can no longer be trustee. That trustee can use those assets to, for your benefit while you're alive, and then can follow the distribution scheme written in the trust to benefit your heirs later on. Speaker 3 00:15:57 One important difference is if you have a will, uh, and you say, a hundred dollars to my grandchild, the grandchild's gonna get a hundred dollars, and if they're under 18, the a hundred dollars might go to a uniform gifts for Minors Act account until they turn 18, but at 18 they get the money. Mm-hmm. <affirmative>, uh, if it's a hundred dollars, it's probably not a big problem. If it's $2 million, you might not want that result. Sure. A trust, a trust on the other hand, will allow the, the, uh, trust or the person making the trust to say, these five people get property, and here's when they get it, and in the meantime, here's how it's managed. Okay. So, for example, young, a family with young children might wanna say the money stays in the trust doesn't get distributed to anybody, until each of the children has gone gotten the opportunity to go through college, the trustee will consider paying for school books tuition. Right. So you can, can use a trust to do what you would do if you were, if you were the not there. Yeah. Speaker 2 00:17:07 Great. And, and, and keep that direction. And, and we're gonna in a more, I think when we come back to, we'll talk in those roles of fiduciary roles of those people that are carrying that out as the trustee. I guess one, one, uh, last thing before we go to break. You know, in, when we were talking on the medical side of the house, we, we heard and learned that there are some documents that you prep up and you put 'em that work really well for that they're there to help you a lot after mom and dad maybe, or when, when they're, when they're totally out of it, or there, there are, there are some legal documents that work when they pass. There are others you need to put into place in case they're kind of in and out of capacity, uh, from one thing to the other. Speaker 2 00:17:44 Is there an impact in a living trust for, since we're talking about this being access to the capital you need to help mom and dad go the distance. Do, is there one vehicle that helps families, you know, work mom and dad through their situation easier than others, uh, for, you know, taking care of those hospitals, they're incapacitated for a year or for six months, or maybe it's only for three months, but being able to handle who's paying the mortgage and where did this come around? Or is that something that's done there? Or is this an individual decision by decision typically? Um, Speaker 3 00:18:17 Well, people, people do it a variety of ways, and they get stuck sometimes because there's not adequate planning. Typically, a trust will provide a standard by which one decides when it's when a, a person can't, uh, function as their own trustee anymore. Okay. Um, sometimes you can get mom or dad to agree to that. Sometimes, uh, you can't, sometimes it has to be decided by a court. You know, it, it varies from, from time to time. But if, if, uh, you know, if, if mom and dad have discussed it and they've drafted that into the trust, that's the easiest way. Speaker 2 00:18:54 Okay. Speaker 3 00:18:55 You know, but, but it's always a little tough to to know when it's, when you're not dealing with a catastrophic event. You know, when is it time to step in and, and help? Speaker 2 00:19:05 Well, and this is one of the first times maybe to introduce a common theme and a concept we'll have throughout today, which is gonna talk through not surrendering, uh, your, your judgment or authority, your autonomy, uh, you know, un unless you really have to, unless you know what you're doing when you do it. And, and for the first time, it really happens for mom and dad, understanding that for them as well, they're looking to not surrender that, uh, unnecessarily or, you know, before they really feel that they would need to. Is that right? I, Speaker 3 00:19:33 Yeah. Well, sure. And and I think that anybody who's gone through this, um, you and me included, you end up having some conversations with the person you're acting for because they're not ready to give everything up. They might not be ready to give anything up, but maybe dad just needs help signing the checks to pay the bills. Right. Right. Yeah. So there, you know, there's some evolution. Couple of things that, that, uh, I wouldn't do. I wouldn't just, uh, put somebody on as a co uh, a co-owner of the bank account, because that's one circumstance where the ownership of that bank account transfers to the second person on the account. Far better to do something in a trust and name the person as a successor, successor trustee, than to change your distribution plan by making them a co-owner of a, an account with half a million dollars in it. Speaker 2 00:20:31 Okay. And because then it throws that all that just takes that off of that. That's almost, yeah. Yeah. Okay. Got it. Yeah, that Speaker 3 00:20:37 Makes, and, and, and so I, I think, again, the, the point of this is this is something to encourage mom and dad to do early on with their, their own advisors. Uh, you and I were talking earlier, if I was in the position of helping mom and dad do that, uh, and I thought that I might be somebody who would be in charge later, I probably wouldn't want to be in the room to help with the planning. I'd want mom and dad to do that independently so that I could act independently later on. Speaker 2 00:21:07 That's great. So let's get, you know, uh, we're gonna take a, a quick break here, and when we come back, let's get into that role of the fiduciary, that fiduciary type role, what's up there, what's, what makes sense from that, how to start thinking about that. Join us for just one second as we come back with auto, she, Jennings, Strauss and Salmon. Uh, and we are talking today about emotional legal decision makings, part three and our Money Matters conversation. Speaker 2 00:23:02 And welcome back everybody. And that is indeed a highlight of the new Parent Projects Connect. It's our project software to help families that are working their way through either a aging in place, a senior relocation, or an end of life function. Uh, today we're talking about some of those issues. We've got auto, she with Jenning, Strauss, and Salmon. He's joined us to talk about part three in our series of emotional legal decision makings. And in particular today, uh, we're focusing on those money matters. Uh, so Otto, thanks again for joining us. Sure. So, uh, we, we started talking during that estate planning 1 0 1 broke it down generally to, to think it through three phases off of that, the financial plan to get mom and dad to the end. The, you know, the simplified transfer then moves into that kind of transfer of those assets that may have been excess or that mom and dad set aside to do works maybe after they were gone. Speaker 2 00:23:52 Uh, and, and hopefully doing so with, with limited conflict and then, and understanding. Then the third would be that the impact of, of the tax consequences, you, you brought up a, a good conversation in limiting the conflict, um, of that, if you're gonna be a fiduciary, if you are the person who's going to carry out the trust, the trustee or the executor or, or whatever that might be, it's probably a good decision to detach yourself from that. Um, and best practices of a fiduciary high level. Let's, let's, let's break into that. What, what's a fiduciary? Speaker 3 00:24:27 Well, a fiduciary is someone who is acting for the benefit of another. Uh, typically, so you're, you are acting as somebody's agent. You're not acting with your own money, you're acting with their money for their benefit. And your obligation, both under the law and under the documents, is to, uh, act in their best interest. So there's actually a statute in Arizona that imposes liability. If you're in a position of trust, and, and I don't mean just formally named a trustee, but if you're acting in a position of trust with a, an older adult who's vulnerable, you can actually have liability if you don't act in their best interest. Speaker 2 00:25:11 So this doesn't necessarily have to be a professional, a professional fiduciary or an attorney or somebody that's, or an accountant or somebody working on behalf of mom, that it can be fiduciary, it could be a family member, or it could be, uh, Speaker 3 00:25:25 Often is, often Speaker 2 00:25:27 Is. Okay. Okay. Speaker 3 00:25:28 And, you know, we talked in the last segment about living trust. And by the way, that's one small slice of a much larger topic about different vehicles, right? Both for tax planning and other purposes that could be used. But each one of those vehicles is going to require somebody to administer it, somebody to read it, somebody to do what it says. And that person is not acting for their own behalf, or even if they are a beneficiary of one of those vehicles, they are not acting solely for them themselves, but they're acting to benefit other beneficiaries as a class. And so, I, you know, I I like to say as a, as a fiduciary, you don't always have to be right, but you do have to be prudent, and you often have legal requirements about communication and disclosure that you have to satisfy. Um, your decisions have to be made, as I say, in a prudent manner. Speaker 3 00:26:30 So you have to consider the variables, and this is where you and I were talking about the need to never surrender your judgment to anyone. If you are the decision maker, you have to have a reasonable basis for your decision. It has to be reasonably calculated to achieve the stated goals for the beneficiaries of the instrument that you're administering, and you have responsibility for the final decision. That doesn't mean you can't hire an attorney or an accountant or an investment advisor or whoever to help you. You probably can, but that, but you can't just turn everything over to them and, and never monitor or never care. Now, that doesn't mean you are going to immediately become a financial advisor overnight, right? You won't necessarily have those ex the expertise, but if you don't have the expertise, you have to exercise discretion appropriately to determine who does, who's the best out of several choices to help with those things and why. And it's probably best to document that decision making process so that you can show that you went through it later on. Speaker 2 00:27:46 You know, that is, that, that brings a great, um, so it's, it's a great factor to weigh in when deciding who's gonna be the executor or the trustee, and even a self-reflection there. I, I remember hearing someone, someone we had interviewed before, uh, state, you can delegate, uh, authority, but you can't delegate responsibility. Speaker 3 00:28:05 Yes. Speaker 2 00:28:06 Hold. So that is thinking about that, knowing that you might find that accountant to carry this out, or a financial planner that's gonna advise them to work through those things, you still will always have that responsibility. And what you're saying is it makes more sense to have a place where you've documented what you've done, where it's done, uh, what it, uh, you know, in, in the ar in the military, we used to talk about the New York Times test. If they took what you did and how you did it, and that, that got listed out on the front page of the New York Times, how is that gonna come across? Would most people be able to look at that and understand, yeah. Okay. That's the most reasonable decision they could have made. Speaker 3 00:28:41 Well, and understand, there, there are a couple of places where this may arise in, in terms of disputes. One is if you made a decision and it didn't go out, didn't come outright, and if, if the investment accounts went down, for example, it would be really important to be able to show the steps that you went through to make the proper, uh, investment decisions with whoever was assisting you. Speaker 2 00:29:10 Yeah. Speaker 3 00:29:11 The, the other possibility, of course, is that, that somebody's trying to influence you to do something, and I I, you just have to resist that. You have to figure out what your responsibility is, and you discharge your responsibility according to the documents in a fair and an impartial manner, and that's your job. Speaker 2 00:29:34 What, what could you do if, let's say, mom, just mom and dad come to you and they're pretty adamant that you're gonna be the executor and who they want to handle these things, and you don't feel like that's some, a responsibility that you want, are there and you want, you wanna offer some, something else out there Are who, who would you turn to, to help professionally? Or who could you offer up for mom and dad? What would be an alternative? Speaker 3 00:29:58 Well, there are, there are professional fiduciaries of course, that, that you can go to in the community and hire somebody to do that job. It costs money. Um, sometimes it's easier if there are enough assets to manage that it's financially viable. It may be preferable to hire a, a professional fiduciary that has investment management cap capabilities, right? I mean, there are, there are fiduciary companies that just take care of the process. And then there are trust companies whose whole business it is to take financial assets, manage them according to the trust service of fiduciary, make the, make the decisions under the trust. And if you've got significant assets to manage financially, that that may be a pretty good alternative. Speaker 2 00:30:44 Uh, I, I like how you broke that down. Okay. Uh, I, I think a, a nice clean, any other roles or anybody in the fiduciary or, or, um, resources or things you can really think about that'd be really important for a family to consider when looking at those who the fiduciary might be or, or how to carry that out? Speaker 3 00:31:02 Well, again, I, I, I think that that's a decision mom and dad have to make. The, the problem is mom and dad are likely to initially make it emotionally. Um, you know, my kids will always get along. John knows most about money. And, and the truth is, John probably does not wanna be in the position of making investment decisions with mom and dad's money, either for their benefit or for the benefit of other beneficiaries. So John's gonna be best off if he's named to find a competent investment advisor who can help take that, or, as I say, find a trust company. But the obligation will arise in a variety of circumstances if you're named as an agent on a healthcare power of attorney, if you're named as an agent on a general power of attorney to take care of property issues if you're named as a trustee of a trust, if you're named as a personal representative under a will, if, if you are named as a manager of a family partnership. All of these are examples of people who have fiduciary obligations. And the key thing to remember is if, if you are in that position, you have to be prudent and you should surrender your judgment to no one. Speaker 2 00:32:16 Yeah. Well, I wanna, when we come back from this last break, uh, let's, let's talk through that for some, for some of us, it, we might not have done a lot of contract management or, or had to evaluate when to surrender some level of decision making or something. So, you know, stay tuned when we come back from this, we're gonna break down just that, you know, great healthy contract management and understanding those types of things as we talk with auto, she jenning, Strauss and Salmon here in Arizona in the Phoenix market about emotional legal decision making. It's part three in our series, specifically breaking down Money Matters. Stay tuned. I'm Tony Siber. I'm the founder of Parent Projects, and I'm gonna take you on a quick tour of the organization. Come on. The organization is full of surprises, and if you've seen one parent project, you've seen one parent project. So generally we just try to be mission driven, objective, virtuous, empathetic, and defendable. We call it being moved. Come on and let me show you the insight. Speaker 2 00:33:18 So our organization lives inside the Arizona State University, SkySong Innovation Center, and Scottsdale, Arizona. It gives us an opportunity, be around a lot of creative people and creativity. Well, sometimes it turns into trouble, but most of the time it's gonna turn into quality content for you. I just want to take this moment to tell you, we're pleased to have you here. We look forward to helping you. If there's anything at all that you need, please reach out, follow us on the other socials that you like best in the platform that's your favorite. And until you and I get an opportunity to talk one-on-one, behold and be held Speaker 2 00:34:05 And welcome back. This week we are concluding, this is part three of our series in Emotional Legal Decisions with Autos Shell of Jennings, Strauss, and Salmon in the Phoenix market. Uh, we're talking specifically about those money matters. So just a high level, if you are joining us from another state outside of Arizona, uh, you're, you're gonna, you know, look for an attorney that's in your particular area. We wanna be always really cautious with our guests and thankful for us stepping up, but understanding that things do change from one state to one state. And so it's something that we always, we wanna stress to make sure that you're talking with somebody in your particular area. A auto, again, thanks for for joining us today. We've, we've gone through some of those just high level estate planning 1 0 1 type things and breaking it down, uh, you know, finding, how do you get mom and dad to the end? Speaker 2 00:34:52 How do we simplify the transfer of those assets with minimal, hopefully family drama, family conflict or, or, um, or, or, um, problems between us. Uh, we talked about a bit in the minimizing the tax consequences, the role that that played. We talked ab, we talked about the roles of an expert, uh, when, um, particularly a fiduciary and the roles of fiduciaries and those experts that might step in, what we could be looking for, the responsibility we hold and yet versus, you know, the, um, the authority that we might turn over. Now, you come down, we've had this constant thing of, of not only our mom and dad, should they be encouraged not to, not to delegate or to surrender their judgment to anybody until they really have to. We would want to take on the same thing as we're advising or we take on those roles. Let's talk about healthy contract management, those times in which, you know, we know we're going to have to engage someone. Uh, oftentimes a senior relocation might be, but it could, it could be 10 to 12 different industries of people that are gonna put some level of contract together that you're, that you're looking at, right. When you're dealing with a parent project. What are some of the basics you should think about in, uh, in contracting with people where we're gonna turn over some level of, of authority or guidance? Speaker 3 00:36:11 Well, I think the most important aspect of that is having a good process for selecting who you're going to use to help you and realizing what their motivation is, what they add and what they, you know, what's beyond their scope. Um, so it, it depends on every situation. But for example, a a lawyer or an accountant is somebody who you pay for advice. They don't, they don't have any interest in your matter financially. They just are there to, they're paid to give you good advice. And that doesn't mean they're going to solve your problem necessarily. And again, don't surrender your judgment to anybody, but they can learn about your circumstance and they can understand your documents, and they can help, you know, the consequences or likely consequences of different courses of action. They can help you plan those. They can, you know, you don't need to learn the tax code to, you know, you can hire somebody who knows the tax code and can help use that knowledge to help you make good decisions, but the decision remains yours. Yeah. You know, Speaker 2 00:37:26 Well, I, I think, I think there's a, there's a, you know, to add the flavor or a context to that too, now you're not just even talking about attorneys or, or even money managers now you start entering others like the real estate agents that you might have to engage in. Sure. Um, and, and then an even understanding, in fact, one, you know, obviously one thing we do, which is a absolutely indicated up in the corner with our parent projects verified program, right? We're looking not, not everyone who, what they do is we particularly tracking the impacts of being age-friendly or working at those end of life type issues, or those, those later, um, they may have a specialty at some other edge. So this would be one of those times to make sure that at least that umbrella of understanding of the emotional impacts and what that looks like and how to recognize signs of abuse or mis influence or other things, and to know how to appropriately respond would be important. That's what, obviously that's what we do with the, with the verified program, is we highlight those, those those professionals that do that. Um, I, I, I look at a, you know, contract. I, I, I seek a lot of contracts in my life. It's something I've spent a lot of time doing. I actually, actually, weirdly, Speaker 3 00:38:35 I'm Speaker 2 00:38:36 So sorry. I enjoy contracts. I know. I don't know why Speaker 3 00:38:40 I need to get you help Speaker 2 00:38:42 <laugh>. I think so. I think so. I enjoy law. I enjoy reading law, I enjoy reading contacts, contracts. Um, but in that, um, we, you and I are having a conversation before about what, what you're really doing for that. I, I mean, I don't, I don't pick it apart to be, rarely am I gonna get an opportunity to make a change in a contract. There may be a couple times I've, I've gotten away with lining through something in general. I've been like, eh, I don't like that. But let's talk through when I'm, I I know when I'm looking for, when I read a contract, you're the attorney, and this is your job is to mitigate risk across the board. That's what we count on you for. You're trained for it. What are the, the parts of context that you bring, uh, what should we be thinking about when we're reading a contract in general, uh, that's, that's, that's thrown to us or, or late in front of us? Speaker 3 00:39:30 Well, so you're talking about a written contract. And, uh, a contract is simply the way people define their relationships in the business world. So you can, you can have contracts with the healthcare providers or the hospitals that, that you use. You can have contracts, you know, if you came to me, you'd have an engagement letter, which defines our relationship. If you hire an investment advisor, you might find they want you to sign a document that that gives them the discretion to go in and out of investments. There are, there are a lot of different contracts, uh, and, and they define your relationship. They define who gets, who pays whom for what. Uh, they define what happens if is a dispute. They, they outline if they're well drafted, all the aspects of the, uh, of the relationship. Sometimes, sometimes you don't have a lot of choice, right? If you, if you want a bank loan, you're gonna sign the document the banker puts in front of you most of the time. Sometimes there's opportunity to, to negotiate, but not all the time. Speaker 2 00:40:38 Um, the, I I, I like the point of usually being tied at some level to the payment model or the way that people are compensated. In fact, so does a, a contract, uh, has some specific characteristics it needs to have for a document to kind of fall within that, right. Um, to help people understand that, um, those, the payment model in, in, in the past when I've had a, a question on something or if I, if I have a question in it, I I, I would bet usually if it's not nefarious, and most of the time it's not. Right, somebody's not trying to go out, they're not, they're not trying to get me. Um, I, it usually tends to be tied to the way that they believe the money would need to flow, uh, in order to happen. And that could be complex, right? Especially if they get paid. Um, in some, in some instances in this, you may do business with, with somebody who doesn't get paid by you. They get paid, you know, by, uh, the housing locator group. They might get paid, they get paid by another place where you land, or, um, someone else steps into Medicaid or Medicare or something to that nature, right? That's, there's, there's an impact there in that language. Speaker 3 00:41:44 Sure. And, and, and how people get paid is a strong motivator for them. Um, yeah. Speaker 2 00:41:50 Couple, Speaker 3 00:41:50 Couple things to keep in mind. One in a day where you can get a little bit of information by picking up a, a fu telephone. Um, careful, it's important to be careful not to assume you know everything you need to know. You only know what you know, and you don't know what you don't know. So having the right advisors for complex circumstances is important. Uh, the other thing that, that I think's, uh, important to realize is if there's a flaw that I see relatively consistency in, in contracts across the board, it's a lack of specificity about what the parties will do. They know they've talked, it's in their minds, but the words don't convey the level of specificity that they expect from one another, and that's where the fight happens later on. Speaker 2 00:42:47 Yeah, I, I've heard that, uh, in real estate, we call those agree to agree clauses where the just are bad <laugh>, they, they turn, we're gonna agree that we're gonna agree when it comes down to that. But I, I remember somebody else telling me, like, for a contract in a business or setting up, you need to think about the end. If you think about the end, if all conflict, you know, what are the highest likelihoods that there's going to be a problem, that a good contract is really developed to walk through that if we don't agree on this type of a thing, this is how we'll settle that. If we don't agree on this type of a thing, this is how we settle that is that, um, Speaker 3 00:43:21 Well, so, but, but even, I mean, those things are very important, right? You plan the divorce when you're planning the marriage so that you know how you're gonna get in and how you're gonna get out. But beyond that, just knowing what the parties will do for one another is pretty important, right? Yeah. Uh, if, if you, if you haven't had a detailed enough discussion, a good example is a shareholder's contract for the owners of a corporation or a operating agreement for a limited liability company. That, that document is the place where if you own a company with somebody, you would, you would document what the responsibilities so that you don't have are so that you don't have to worry about what happens if one of the three owners decides to stop working as much, right? Speaker 2 00:44:13 Right. Right. Speaker 3 00:44:14 Who's going to do what for whom? When? How's it going to happen? How will people be compensated for it? If somebody wants out, how do they get out? If somebody dies, what happens? All of those details, that, that's just an easy example. But all of the contracts that you're faced with are, are important because they define that relationship. Some are simple, you bring me this, I'll pay you that we're done until I hire you to do it again. Some are not so simple. And some are ongoing relationships with higher levels of expectation about performance and, and what somebody will do. Speaker 2 00:44:52 So the, uh, that, that crux of what you're really getting is in that healthy contract management, read it, have a level of understanding to it. If you, if I have a, I have a question about it, I can ask 'em about it. Yeah. Just, yeah, yeah. Ask 'em in plain language to maybe explain it to me a different way. Make sure you've got good clarity and make sure that you've gone to the right level of specificity, um, about how we'd handle those. Um, is it easier to add language to a contract than to take something off of that in some cases, in your experience? Speaker 3 00:45:25 That depends on who you're dealing with. Speaker 2 00:45:27 Okay. Okay. Speaker 3 00:45:29 Sometimes yes, sometimes no. I, I, one, one other thing I would add to this discussion is I learned a long time ago, if somebody can't explain it to you in pretty plain English, there might be something wrong. Speaker 2 00:45:43 Okay. Speaker 3 00:45:44 And I think, I think it's important that if, if language in the contract is too convoluted or too hard to understand, it's just an opportunity for a misunderstanding. Speaker 2 00:45:55 And, and I really like that you, that you went off of that and you, and you, you claimed that, or that that's where you went with that, because I've, I've run into that as, as well, professionally and personally. And, and it wasn't, again, it wasn't a nefarious about the other person. It simply was they didn't even understand the document, and that could lead to just as much of trouble between us. Yeah. Uh, as, as it being, you know, something that was gonna work against me, uh, or where they were trying to get me. That was less of an issue, honestly, in this thing than the fact that both of us didn't really understand the document that we had in front of us. Speaker 3 00:46:33 Um, well, and, and remember too, if you're in this, you're oftentimes acting as a fiduciary, as we talked about earlier. And so entering into agreement is a fiduciary act. If you're not careful enough about reviewing it or getting advice about it, then you may have liability if you make a decision or take an action that doesn't turn out right. Speaker 2 00:46:58 Yeah, I, that's, um, probably a great place to kind of tie a bow against all that. There's a million places we could go off of all this, and I'd expect maybe to get into some of these details in other episodes that you and I get a chance to sit down and talk to. Um, where should people go to look to find an attorney, uh, in their particular state? Is there a, is there a great put place to start on the estate side of the house or dealing with this type of stuff? Any, anything that you recommend? Speaker 3 00:47:25 Uh, you know, somebody, often people can get from word of mouth. They can get ideas about who other people have had good luck with. Yeah. Kind of need to find, find referrals that have your level of, of need and concern. State bars will often have, have referral lists that they can use. The Arizona, like other states has specialization certifications. For example, I'm a certified tax specialist with the state bar. So you can go there and you can find people who have, um, pursued a certain course of study, have a certain level of experience, and taken some testing to qualify for that designation. Um, but often it's just who you know and, and who's had good luck with, with other people. So, Speaker 2 00:48:15 Great. I, you know, la last question again. So that if your family lives in different states, what is the, what is really the driving when you're, and you're gonna engage off of that? Let's say you got a sibling that lives, well, you know, our, we have a sibling in Florida, sibling in Arizona, mom, uh, lives in Kansas. Talk me through, what, what is, uh, what is the state that we're gonna want to get that, um, that we're gonna want to seek, you know, the legal counsel and the accounting and that work off of, Speaker 3 00:48:44 Well, if mom's doing the planning, you're gonna need to do it in Kansas. That's where he said mom lived, right? Speaker 2 00:48:49 That's right. Speaker 3 00:48:50 Yeah. Following the, trying to follow a map around Yeah. Speaker 2 00:48:52 Yeah. <laugh>. Speaker 3 00:48:53 And, and, and that means, you know, maybe you start with whoever you know here to see if they have a relationship. So our, our firm, for example, has a relationship with mid-size firms around the country. And if I needed somebody in Kansas, I would look first to a firm that we have a relationship with. But other people have similar types of, of cross-referral relationships. It's a little hard when you just don't know anybody. You can't just drop into town and, and call someone. Yeah. The the other thing I would add is, um, just because you get a referral, don't just settle there, interview two or three people and understand who people are. At the end of the day, any professional relationship you're entering into with an advisor is going to be a personal relationship, and you have to figure out who you can work with and how you communicate. And so getting two or three possibilities is probably a wise way to go about it. Speaker 2 00:49:47 Uh, that's great. That's great. Otto, I really appreciate the time you've taken with us, uh, against this entire series for emotional legal decision makings today on the money manners in particular, and the previous episodes. You guys can check those out, uh, and then, you know, let us know where can they find more for you, Otto, where do, uh, where does, where does everybody here in Arizona find you? Speaker 3 00:50:07 Well, you've got our website up. My name is Auto Shill. My email is o S H I L [email protected]. And, uh, the phone number for the firm is 6 0 2 2 6 2 5 9 1 1. So feel free to call. Speaker 2 00:50:24 Wonderful. I appreciate it. Well, Otto, thank, thank you again as we broke down again in this episode, this as estate Planning 1 0 1, our fiduciary roles and how that plays into our parent projects. Finally, healthy contract management. That was a mouthful, and I really appreciate the time you took today to share your time, talents, and treasures with us. Thank you so much. Thanks for having me, Tony. Have a good day. You, too. Speaker 6 00:50:50 Well, that's it for the team this week, and thanks for joining us. If you've enjoyed the content, remember to subscribe and to share this episode on the app that you're using right now. Your reviews and your comments, they really help us expand our reach as well as our perspectives. So if you have time, also drop us a note. Let us know how we're doing for tips and tools to clarify your parent project, simplify communication with your stakeholders, and verify the professionals that you choose. You can find us on YouTube, follow us on Instagram and Facebook. Thanks again for trusting us. Until our next episode, behold and be held. Speaker 1 00:51:23 Thank you for listening to this Parent Project's podcast production. To access our show notes, resources, or forums, join us on your favorite social media platform or go to parent projects.com. This show is for entertainment purposes only. Before making any decisions, consult a professional. This show is copyrighted by Family Media and Technology Group, incorporated and parent projects l l c. Written permissions must be granted before syndication or rebroadcast.

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