Lessons From Fisk: Limits on Testamentary Freedom

Lessons From Fisk: Limits on Testamentary Freedom

By Melinda Gustafson Gervasi

November 24, 2024

There is nothing in the world so irresistibly contagious as laughter and good humor.

― Charles Dickens, A Christmas Carol

Seeking a dose of laughter to offset the heaviness of world news and the increasingly shorter days of sunlight?  If you have Netflix, you may enjoy the Australian ABC comedy that first aired in March of 2021, Fisk.  Starring Kitty Flanagan as Helen Fisk, it is a witty comedy set in the law office of Gruber & Gruber, a small (shabby) suburban office that focuses on estate planning and probate. 

Recently I laughed my way through all six episodes of Season One.  I enjoyed them so much that I rewatched them with my husband.  With hyperbolic scenarios, the show explores accurate aspects of my everyday work life.  Today, and for the remainder of the calendar year, my weekly blog post will examine each episode and a take-away for the viewer seeking to learn more about estate planning and probate.

Day one at in her new position as an associate with Gruber & Gruber, Helen finds herself face-to-face. with her first client, Ruth O'Mallely.  Ruth explains that her mother died recently, and under the will, the estate is to be shared equally between Ruth and her brother Dean,....on one condition. Upon reading the will, Helen informs Ruth that the condition of the will cannot be enforced. For those interested in watching the series, I will avoid the specifics of the episode. The scenario is a perfect example of limits on testamentary freedom.

Here in the United States, estate planning and probate laws are written by state legislatures.  That means each state may have slightly differing rules and laws about this area, however, general concepts can be found from sea to sea.  In general, a court, when asked, will not validate a clause in a will that violates public policy.  The most common example of a will violating public policy would be a clause that either encourages divorce or limits marriage.  

As Helen explains to her client, just because a will dictates a condition on inheritance, does not mean a court would enforce it.  "My daughter inherits my entire estate if she divorces her husband" would be an example of a will provision a court would not enforce because it encourages divorce, which is viewed as contrary to public policy.  If you would like a more colorful and humorous example of this legal concept, check out the first episode of Fisk. 

Remember that a blog post is meant to spark thought and discussion, it is not legal advice.  Please consult an attorney in your state of residence for legal advice specific to your situation.  Thank you for reading, be well. 

 

How to Get Your Elderly Parents Talking About End-of-Life Issues - Use a Book to Spark Conversation

How to Get Your Elderly Parents Talking About End-of-Life Issues - Use a Book to Spark Conversation

By Melinda Gustafson Gervasi

November 17, 2023

"Seriously Mom, maybe you could try read something a little less depressing.  What is this?"

Wisecracked my 13 year old daughter as she passed my home desk one evening.  

"Oh, that.  It's a book I've read already.  Gail gave it to me as sort of a gag 50th birthday gift.  Gail's sort of doing Swedish Death Cleaning and thought I'd be a good place to re-home the book."

Image by M. Gustafson Gervasi, the author's 50th ice cream birthday cake

The book is the graphic novel, a memoir technically, by Roz Chast, titled Can't We Talk About Something More Pleasant.  Released in 2014 it was a National Book Award Finalist, and it may be just the thing to take with you when you go home for the Thanksgiving Holiday or if you are hosting this year, set it out on the coffee table.  The book caught the curiosity of my teenager; it may do the same for the elderly family members who don't know exactly how to get talking about "stuff".  You know, "stuff;" powers of attorney, long-term care, wills, funeral arrangements, etc.   Sometimes talking about an author's experience is an easy gateway into talking about your own wishes.

Chast's book is a quick read and offers her experience with parents that were resistant to talking about the end of life and their wishes.  As we enter the time for winter holidays, families tend to gather.  Many adult children wonder about how to get their parents talking about end-of-life matters, this might be one approach.  I'd suggest that if you do get the book and have a talk, pull out some chocolate to soothe the emotions. I keep a bowl of Ghirardelli chocolate in my office for clients -- sometimes they need a boost after talking with me about worst case scenarios.

My copy of the book, atop my home writing desk

A blog is intended to spark thought and discussion, it is not legal advice.  Please consult with an attorney in your home state for advice specific to your situation.  Thank you for reading!  Follow along with future posts; click Follow in the upper right corner and enter your email address.   Be well!

 

Middle Class Philanthropist - How Anyone Can Leave a Legacy

Middle Class Philanthropist - How Anyone Can Leave a Legacy

By Melinda Gustafson Gervasi

November 10, 2023

Ten years ago I published a small book, designed to be read in an afternoon while enjoy a mug of coffee or a cup of tea.  The intent behind Middle Class Philanthropist: How Anyone Can Leave a Legacy was to inspire the average American to be philanthropic when creating or updating an estate plan. Much is written about philanthropy in November because the 15th of the month is National Philanthropy Day. All too often the stories of giving involving multi-millionaires donating sums most of us cannot wrap our minds around.  But there is another path to philanthropy, one any of us can take. 

I hold the core belief that anyone can leave a legacy. It does not require excessive wealth when directed with intention and purpose.  If you want to leave this world with a final gift, here are a few options noted in my book:

• Designate an In Lieu of Flowers charitable cause.  Recently I attended the funeral of the father of a childhood classmate.  Instead of purchasing flowers the family encourage mourners to donate to one of his favorite causes.  My family did, sending a donation in his honor to the UW Veterinary School of Medicine fund for families in need of financial assistance.
• Donate 2% of your retirement accounts to a non-profit.  All it takes in a quick update to your beneficiary form to name a nonprofit that made a difference in your life.  I opt for 2% because it is "a little something" that in the end may not be missed by other dependents.
• Encourage your family and loved ones to hold a garage sale for tangible personal items that no one else needs, with the proceeds being directed to a nonprofit you select.  Promote this giving opportunity at the sale, and have literature on hand for shoppers who may want to learn more about a cause you felt was worthy.

These are three simple acts, which you can likely accomplish without having to visit an attorney's office.  Everyone can make a difference in this world.  If you want to read more about my thoughts on Middle Class Philanthropy I encourage you to purchase my book, or for those in Dane County, Wisconsin, check a copy out from your local library.

Remember a blog is not legal advice, but rather a spark for thought and discussion.  Please consult an attorney in your state for advice specific to your situation.  Thank you for reading, and be well. 

3 Situations When A Living Revocable Trust May Make Sense

3 Situations When A Living Revocable Trust May Make Sense

By Melinda Gustafson Gervasi

November 3, 2023

America is made up for fifty different states.  Laws related to estate planning and probate are written at the state level.  That means there are fifty different sets of laws and regulations governing end-of-life matters.  It is critical to know the ins and outs of the laws of the state you reside in when creating an estate plan because terms, fees, and responsibilities can vary greatly.  For example, the cost of going through probate in Wisconsin is quite low compared to an estate in California.  More specifically, under Wis. Stats. 814.66 the fee assessed on a probate estate is 0.2 percent.  In contrast, according to online research the fee in California is more complicated and costly:

In California, statutory probate fees are based on the gross value of the estate and are as follows: 4% on the first $100,000; 3% on the next $100,000; 2% on the next $800,000; 1% on the next $9,000,000; 0.5% on the next $15,000,000.

Image by M. Gustafson Gervasi, 2023

Because probate in Wisconsin is not nearly as expensive as other states, I find that many of my Wisconsin clients can accomplish their goals without the cost and complexity of a Living Revocable Trust, which is a sophisticated tool that creates a virtual basket to hold your assets and distribute them at death, bypassing the probate court system.   However, there are 3 situations in which I think a Living Revocable Trust needs consideration:

1. Owning real estate in multiple states.  Years ago I had a client with a home in Wisconsin, a cabin in Michigan and a condo in Arizona.  If the client used a basic will, probate would happen in three states (WI, MI, and AZ).  Using a Living Revocable Trust would allow the properties to be re-titled and placed into the trust, which would distribute them at death, and thus avoid probate.  In this situation the client opted to use a more simple tool, the Transfer on Death Deed, which was available in 2 of the 3 states;
2. Families with second marriages and children from outside the union. In this situation you may want to use a Living Revocable Trust to create an asset pool the surviving spouse can use, but not deplete or re-direct to other people when the first spouse dies.  A Living Revocable Trust can be used to "lock-down" part of a couple's assets at the death of the first spouse in an attempt to ensure children from outside the marriage inherit.  This does set up a situation in which the surviving spouse's activity is scrutinized by the deceased spouse's children, which could lead to awkward holiday gatherings and tension; and
3. When you are "writing out" a natural heir from your estate.  A Living Revocable Trust allows for your final expenses to be paid and your assets distributed without going through probate.  Normally, the probate process requires notification of all "interested persons" -- those named in the will and those who would inherit under statutes if there were no will.  It acts as a check on the will to root out fraud or undue influence, and can create an easy venue for a disgruntled person to challenge a will.  Since a Living Revocable Trust does not go through the court process, these this too-easy to dispute path is avoided.  In a sense, it can reduce the chance of needless litigation.

Those are the 3 scenarios that immediately lead me to discussing a Living Revocable Trust with clients.  Note, a blog is NOT legal advice. It is meant to spark thought and discussion.  Please consult with an attorney in your home state for advice specific to your unique situation.  Thanks for reading, be well, and click FOLLOW in the upper right corner to enter your email and receive future posts. 

Annual Checklist for Estate Planning

Annual Checklist for Estate Planning

By Melinda Gustafson Gervasi

October 27, 2023

Image by M. Gustafson Gervasi, 2023

Monday, the 30th of October, ushers in National Checklist Day.  Yes, it is a real thing according to the internet.  It's origins are tied to the aviation industry, specifically pilots and flight attendants created safety checklists to make the new era of aviation safer.  Defined, a checklist is a list of requirements, things to be done, points to be considered and or a reminder.    

Within the area of estate planning and probate, here are 7 items to include on your annual checklist to ensure your plan is up-to-date and accessible:

1. Copies of your power of attorney for health care are on file with your primary care doctor, any specialist you use, and your hospital of record as well as with the agent(s) you named to speak for you if you are too sick;
2. Copies of your power of attorney for finances are with the agent(s) you have named to handle your financial matters if you are alive but too sick to manage your own affairs;
3. Your original will is in a safe and secure location that is accessible to your Personal Representative (Executor in other states) -- for residents of Dane County, Wisconsin, an original will can be filed for safekeeping with the probate court;
4. You have a complete list of assets that have named beneficiaries;
5. A copy of the deed to your home or other real estate that you own;
6. Names and contact information of professionals who assist you in your life -- CPA, veterinarian, insurance agent, financial planner, attorney; and
7. List of organizations that should be contacted in the event of your death -- religious organization, professional associations, civic clubs, neighborhood groups.

This list mentions 7 items to include on your checklist.  It is by no means a full and complete list, but enough to prime the pump.  Remember that a blog is not legal advice, it is meant to spark thought and discussion.  Please consult an attorney licensed in your home state for counsel specific to your situation.  Thank you for reading, be well, and click FOLLOW above to enter your email and receive updates on future posts.

Buyer Beware - Spotting Trouble in the Land of Trusts

Buyer Beware - Spotting Trouble in the Land of Trusts

By Melinda Gustafson Gervasi

October 20, 2023

After a decade of public speaking on the ins and outs of estate planning and probate, mainly as a guest presenter for a financial education nonprofit or a local library, my words flowed freely during my talks.  After covering the basics of powers of attorneys, wills, and probate, I would briefly comment on the roles of trusts in estate planning.

"A trust is a tool that functions like a basket, it holds your assets. A trust can be created during your lifetime, known as a Living Revocable Trust.  Or a trust can be formed at your death, called a Testamentary Trust.  One feature of a Living Revocable Trust is that the assets inside avoid probate at your death, and transfer directly to the people and or organizations you designate in the paperwork.  For a Living Revocable Trust to work you have to transfer your assets from your name to the name of the trust.  For example, if my spouse and I decided to create a Living Revocable Trust we would have to change the deed to our home in order for the trust to work properly. It would go from "Charles J. Gervasi and Melinda Gustafson Gervasi, marital property with the right of survivorship" to "The Charles J. Gervasi and Melinda Gustafson Gervasi Living Revocable Trust of [date it was created]".  

Then I'd insert a bit of levity:

"For those of you over a certain age you will receive fliers in the mail inviting you for a free fish dinner at a local restaurant as apart of a speaking series on the wonders of trusts."

Audience members would nod and laugh knowingly.  Many were approaching or at retirement and knew these fliers well.  Their arrival correlated with the solicitations to join AARP.

"Be careful, many of these organizations are LLCs that open-up shop in your area, sell a bunch of overpriced trusts, and then close the doors leave town without ever helping you fund the trust.  They are trust mills, and border on fraud."

I'd take a sip of my hot tea to calm my vocal cords and launch into the dangers of trust mills and fraud, providing listeners with a few simple tools to assess whether or not the "free dinner" was worth it, and when the expense of a Living Revocable Trust might make sense of them.  The seminar would wrap up, with me commenting that I would stick around for a few minutes to take questions from those who did not want to ask in front of a large crowd.  I would add that I would need to head out by 9pm in order to tuck in my two young children at home.  

Time has a habit of moving forward.  Those two kids of mine are now both teenagers, and this past week my husband received such a flier in our mailbox.  A subtle reminder that in some database we are now deemed eligible for the "free fish dinner" seminar.  Needless to say, we will not be sending in a RSVP. 

Badlands, South Dakota, Image by M. Gustafson Gervasi, 2023

If you receive such a mailer, beware and remember, there is no such thing as a free lunch.  Keep in mind:

• Probate in Wisconsin is not as expensive as other states.  Our statutory fee is 0.2 percent while other states are 6 or 8 percent.  A quick back-of-the-envelope calculation will show you how much a house, car, bank accounts (assets without a named beneficiary) would cost going through probate.  You can then compare that fee with the fee of creating the Living Revocable Trust being sold (the fee on a $350,000 home going through probate is $700);
• Living Revocable Trusts do not hold certain assets well, such as retirement accounts.  This means you cannot use the trust to hold that asset and have to make other plans;
• Individuals selling these instruments may not be attorneys licensed in Wisconsin, meaning they are limited in their ability to help you create, fund and maintain a trust.  A simple test is to ask the attorney for their Wisconsin Bar Association Number -- we know them by heart and should be able to recite it quickly;
• Gather information, but take time to process, reflect and comparison shop.  Never feel pressured to sign up for an appointment the night of the dinner;
• Read the fine-print.  Our flier says "Financial Professionals, Accountants, and Attorneys will be charged a $5,000 educational fee".  So, if I were to attend, they'd charge me $5,000 -- hmmm,  seems like they want to discourage me from attending, I wonder why?  

Thank you for reading.  Remember that a blog is meant to spark thought and discussion, it is not legal advice.  I encourage you to seek counsel from an attorney licensed in your home state for help with your unique goals and needs.  And if you are curious about those pre-pandemic talks I used to give here is a sample from one done via Zoom as the pandemic shifted how we gathered.

Friday the 13th: Dying in the Age of Tech

Friday the 13th: Dying in the Age of Tech

By Melinda Gustafson Gervasi

October 13, 2023

Friday the 13th, is a day associated with all things bad luck.  From the Biblical account of 13 people attending the Last Super to the 1980s pop culture hit movie with Jason in a ski mask, this is a day known for darkness.  So it seems appropriate for today's post to mix two areas of doom and gloom: death and tech, more specifically, tech that is not easy to operate.

Marriage to an electronics engineer has amped up my luddite tendencies, leaving me with less than adequate skills to operate our tech devices.   Over the years when a cell phone needed an update or it was time to install a new printer or adjust our Smart thermostat, I commonly let my spouse take the lead.  He is more more efficient, capable, and considers these tasks fun.  His professional hours are spent designing circuit boards, so the decision was a no brainer.  However, with my entrance to a new decade (I recently celebrated my 50th birthday), I realized that I should know how to do some of these things as well.  Just in case.  Maybe my phone will need to be replaced while he is traveling for business, or maybe.....my well-trained estate planning and probate brain quickly spins scenarios in which I will need to sort these issues out on my own.  

Which leads me to this list, 13 tech devices that may need some explaining about how to operate and or maintain.  Such a list may be useful to your life partner and or personal representative (known as an Executor in most states) should your time come:

1. Cell phone
2. Personal computer
3. Home security system (including cameras)
4. Heating, ventilation and air conditioning
5. Energy efficient power sources, such as solar panels
6. Outdoor garden equipment
7. Assorted home automation - lights or sound systems
8. Smart locks to your home and or vehicle(s)
9. Automated pet feeding devices
10. Internet access and wiring
11. Smart lawn mowers and snow blowers
12. Your vehicle(s)
13. Voice activated controls for home appliances (giving Alexa commands to dim the lights)

Willa - author's cat, pictured in 2008.  RIP.

Death will come for all of us, take the moment to leave some easy to access instructions for the loved ones you leave behind.  Then go out and enjoy Fall Fun at a corn maze, apple orchard, or Oktoberfest.  Remember that a blog is meant to spark thought and reflection.  It is not legal advice.  Please consult an attorney in your home state for advice specific to your unique situation.  Thanks for reading, be well, and click Follow above to receive updates on future posts.