Adapting: Technology and Wealth

As an estate planner, it is fascinating to me to see how some have acquired their wealth. When I began my career, many “wealthy” families had earned it the standard way, through careers, businesses and salting away a significant portion of their income.

It is even more fascinating to see how the rules of the game have changed so very much in the last several years. By that I mean solid businesses and careers can implode by becoming obsolete overnight. The microchip and the technological advances it offers has changed our society. Those who keep up with technology and incorporate it into their careers and businesses prosper. Those who don’t suffer.

And that’s because the microchip has caused many businesses and careers to fall victim to the “commoditization trap.” The commoditization trap, simply put, is the perception that the goods or services that your business offers are the same (a commodity) as any of your competitors. You see this most often today when shopping for goods. You might look in the bricks and mortar store but then go on the internet to find whatever you are looking for at a cheaper price.

And it isn’t limited to goods. Services are being commoditized too. Why should I pay the stockbroker his normal commission when I can trade for $6 on the internet?  Why should I pay the CPA to prepare my tax return when I can prepare my own for free using a web site? Why do I pay an estate planning attorney when I can prepare my documents on the internet for a fraction of the cost?

But there is a way for both businesses and service professionals to break free of the commoditization trap. They must first recognize the trap exists and then embrace the same technology that produces the gap in order to create unique, personalized value that consumers will flock to. Where everything looks the same, people search for someone who can provide three things – leadership, relationship and creativity. Those are elements that no computer can replicate.

Leadership, relationship and creativity enhance the consumer’s comfort, clarity and confidence.  Whether the decision involves which new car to purchase or how best to balance one’s investment portfolio, those that can help the consumer zero in on what’s most important to him or her will find success.

What this means is that it is the consumer and not the producer that drives our economy.  Large institutions – whether they are government bureaucracies or private enterprise – can no longer dictate how we live our lives. The old days of companies dictating what the consumer wants are over.

Take the music industry as an example. When I was a kid in the 1970s, if I wanted to buy a song that I heard on the radio, I would have to purchase the whole album for $15 or so.  That was a lot of money in the 1970s. Even though I only liked the one song but had to purchase the package – this was the way that the music industry packaged its product. The consumer had very little choice. Moreover, the artist got paid a tiny fraction of the album price. The music labels, agents and distributors got the lion’s share of the profit.

Today, if I hear a song that I like on the radio, I can go onto iTunes and purchase that song for $1.29 or less. I don’t have to purchase the entire album. Moreover, the artist realizes a much larger percentage of the revenue. He or she can upload his work into iTunes without the need for a record industry label. This is a consumer-driven (bottom-up) economic model. The record labels aren’t largely the players in the industry anymore. Without the microchip this wouldn’t be possible.

Another example can be found in the travel industry. When was the last time that you used a travel agent to book an airfare, hotel or rental cars? Consumers largely drive the travel industry economy. You can easily research destinations, read reviews posted by other travelers and decide on your itinerary from the comfort of your living room sofa. All driven by the microchip.

I can customize an automobile from the internet, design my own running shoes or even order custom golf clubs and have them delivered to my home within a few days. The companies that realize we are in an individual-oriented personal design economy prosper. They have circumvented the commoditization trap by offering unique-personalized fare utilizing the same technology that drives their competitors out of business.

These can be scary times for those who don’t adapt. But they also offer unlimited economic opportunity for those who understand the challenges and are willing to use technology to their advantage.



European Musings

Hello from Europe, where I’ve spent a good part of July. In late June we dropped off my youngest at a Brown University Spanish Immersion Program in Segovia, Spain—allowing us to tour Madrid and Barcelona. At the time I write this Patti and I are in Switzerland enjoying the Alps, and soon we journey off to London. We’ve been to Europe before, but for some reason—perhaps my advancing middle age—I now notice some things that I wish were truer at home.

While I am very proud to be an American and believe that our system is the best at fostering entrepreneurship and, therefore, innovation, I must say certain aspects of European life appeal.

While in Zurich, for example, my wife and I walked the old town searching for a dinner spot, eventually finding an Italian restaurant. Our table, like many, was situated on an outdoor patio adjacent to the pedestrian gasse (alleyway). It was nine o’clock in the evening, which is the beginning of dinner hour in most of Europe, even on workdays.

Locals and tourists alike strolled by. Our table was a nice place to people watch.

At the table beside us, a group of four clean-cut, good-looking twenty-somethings—a young man and three young women—conversed. Even if we were to eavesdrop we couldn’t understand most of what they said as they were speaking German. It was clear, however, that they were engaged in a variety of topics, enjoying each other’s company.

And that’s the first aspect of European life I find admirable. Dinnertime is used not to wolf down food in front of the television. Rather, it’s a time to have a glass of wine or a bottle of beer and engage in conversation for a solid hour or so before the actual meal is even ordered, nonetheless served. While the young man and women beside us each had an ever-ubiquitous iPhone, their eyes were rarely glued to the screens.

Servers are paid a decent wage and therefore don’t rely on tip income as do their counterparts here in the States. While the menu prices appear about twenty percent higher than ours, when you factor in the concept that tips aren’t expected, the net result is similar. While I’ve heard that this leads to rude, indifferent servers, we rarely found that to be the case. In fact, our delightful waitress at this particular restaurant provided a delicious strawberry tiramisu free of charge when she noticed that Patti hadn’t finished her main course, as it was a little too spicy for her taste. She provided the free dessert despite the fact that neither of us complained about it.

Perhaps because servers are paid a decent wage, table turnover is no big deal. They don’t rush guests through meals as it is expected that you will occupy your seat for several hours. Because I’m so conditioned to eat quickly, I had to consciously slow myself down to enjoy the atmosphere.  I’ve read numerous health journal articles promoting this style of eating. Here that’s the norm.

Dinner, in fact, is not the big meal of the day. Lunch is. We noticed while in Spain that the custom of a mid-afternoon “siesta” is followed as many stores closed briefly. I can’t imagine that taking place in any American venue, evidenced by the fact that American retail storefronts—including the Apple store—remained open despite the local shops’ mid-day break from the hustle and bustle.

Public transportation seems so much more convenient than what we have here in the States. Granted, our larger cities (New York, Chicago and Atlanta for example) do have good, reliable trains and subways whisking one about. But in Europe almost every major city’s local system is connected to an easy-to-use and not very expensive international system. Perhaps the United States is too large to expect such a network, but Patti and I enjoyed the clean trains providing a smooth, fast ride between our destinations. It’s so much easier and less stressful than an airport experience.

By the time this column makes the paper I’ll be home, back at work and conducting my normal life. I consider myself fortunate that I have the opportunity to enjoy other cultures and take a step back from the day-to-day routine. Maybe from now on we’ll eat dinner a little more slowly, keep the television off and our iPhones out of reach.

The Story of Uncle Benny

In my wife’s family lore they tell the story from many years ago about Uncle Benny who didn’t trust his doctors. One day Benny experienced crushing chest pains and was rushed by ambulance to the hospital. His wife and a host of other close relatives chased in a car behind. Once examined in the emergency room, he was transferred to a regular hospital room.

It seemed like eternity until a doctor arrived. The family nervously gathered around Benny’s bed while the doctor looked at everyone and smiled. “I have good news, Benny!” the doctor exclaimed. “You didn’t suffer a heart attack! You might have had gas or something else, but you’re just fine. It will take a few minutes but as soon as we process the paperwork you’ll be released to go home.”

Everyone in the room exhaled, chattering away with pleasure over the news. But not Benny.

As soon as the doctor left the room, he picked up the telephone and dialed zero on the rotary dial to reach the hospital receptionist.

“What are you doing, Benny?” his wife hollered at him.

“Shush!” Benny waved his hand in her direction pressing the receiver to his ear. “Hello? Is this the hospital receptionist?” Benny shouted into the telephone. “Tell me please. What is the condition of a patient you have by the name of Bernard Leber? ……CRITICAL!? CRITICAL YOU SAY?!?!?”

You see, Benny didn’t believe his doctor and instead chose to call the front desk of the hospital to see what condition they had him listed in. That was back in the day when you could call a hospital’s switchboard and find out a patient’s condition simply by asking.  Benny’s condition hadn’t been updated yet, and he believed what the receptionist told him over what the doctor had said.

There wouldn’t be such a funny story if Benny had been in a hospital today. The Health Insurance Portability and Accountability Act (HIPAA) prohibits doctors and hospitals from discussing anyone’s medical condition or history without that person signing a release. When you go to your doctor’s office these days you are typically asked to sign such a release naming the individuals the doctor is allowed to talk to without violating your privacy rights.

To violate HIPAA could result in the doctor or hospital committing a federal crime. Which leads me to today’s estate planning topic – and that is the important document that everyone should have as a part of their estate plan – the general HIPAA waiver and release.

Suppose that you are in an automobile accident. If you are rushed to the hospital and are unable to sign that hospital’s HIPAA waiver, then the doctors and other hospital support personnel are prohibited under federal law from discussing your condition even with your spouse or children. I would agree that this law is overzealous and borders on silly – but that’s what we have.

And if you don’t believe that a hospital would limit your spouse’s access to you in such an event – take it from me – they will. You see, thirteen years ago while alone on training ride on my bicycle, a car hit me. I was actually on the Summerlin Road bike path and not on the street itself when a car coming in or going out of a subdivision caused me to crash.

I don’t remember much about the accident. Whoever hit me fled the scene. A Good Samaritan must have called 911 – I was unconscious – and I was eventually rushed by helicopter to the Lee Memorial Trauma Center downtown. I had suffered skull fractures (my bicycle helmet saved my life) and was bleeding out of my ears.  I was a John Doe in the helicopter since no one looked in my bike’s saddlebag where I kept a health insurance card exactly for this scenario.  Eventually I was able to tell them Patti’s name and cell phone number. She got a very scary call and rushed to the hospital.

Where they wouldn’t let her see me.

Why? Because I hadn’t signed a HIPAA waiver! I was semi-conscious being treated in the emergency room.  But since I hadn’t signed a HIPAA waiver they wouldn’t let her in to talk to the doctors or to learn exactly what my condition was.

Luckily I have good friends who are doctors who also rushed to the ER and let Patti know what was going on. But it was frustrating for her.

After that incident I decided to include in my client’s general estate planning portfolio a standard HIPAA waiver and secure, mobile access to that waiver that allows each client to list any and all individuals he or she would want to receive their health status from doctors and hospitals in case they hadn’t signed that specific hospital’s waiver.

I believe that many other estate-planning attorneys are now following this protocol. If you don’t have such a document in your planning portfolio, you might want to ask your estate-planning attorney for one.

Because unlike my wife’s Uncle Benny, your family can’t dial the hospital receptionist to learn your current condition – even if that condition isn’t exactly up to the second accurate!

The Magical Money-Making Power of Imagination

As ABC is wont to do, a Harry Potter marathon aired this week, and I got to thinking. The last installment of the Harry Potter films was released a six years ago this month – which I can remember raised an interesting dinner conversation that that film’s debut sparked between me, my wife and our three daughters. “What do you think,” I began, “about the fact that an immense amount of value and wealth was created by a welfare mom who hand-wrote a manuscript on a subway as she headed to work?”

My kids didn’t know what I meant by “value” so I explained further. “Value is created when someone appreciates something – be it a good meal, a good book, a movie – or even when someone might have a better job or other exciting adventure due to something that was created. Here, because J.K. Rowling’s imagination created the world of Harry Potter in written form – it spawned the books, of course – but also the movies and all sorts of things. And true value is eventually what spawns wealth.”

My daughters got excited by the idea – and caught on quickly. They identified all sorts of value that would not have otherwise been possible but for the imagination of J.K. Rowling. Daniel Radcliffe (who played Harry Potter in the feature films), for example, may not have ever become an actor. All sorts of people – from the rest of the movie cast, to publishers, to screen writers, to movie production staff – all had interesting jobs that may never have been possible but for the Harry Potter books – and Rowling’s imagination.

The new film series, Fantastic Beasts and Where to Find Them, that takes place in the same universe as Harry Potter, as well as many new books and websites are constantly cropping up.  Each stems from the imagination of this now famous author, raking in thousands of dollars every day.

Universal studios even built a replica of Hogwarts inside of its Islands of Adventure, which was recently followed by a recreation of Diagon Alley in its Universal Studios – allowing all sorts of people who visit Orlando to have an enjoyable experience, notwithstanding creating jobs for architects, builders and craftsmen. So there was likely billions of dollars created out of one divorced woman’s imagination.

My daughters started to think about others’ imaginations that had similar impact. The list goes on and on. Aside from entertainment you have those who work in technology to medicine to transportation. And, by the way – that’s why America is one of the greatest nations on earth– because our culture fosters and encourages imagination. We don’t care about how things were done under the “old way”. We are always looking for the new, improved version of things.

So how does all of this relate to estate planning? I think it does in many ways. One’s estate and financial plan could be a stamped out carbon copy of many others – or it could have an imaginative outlook that instead fosters the values, hopes and dreams of its creator.

The man who owns and runs the family business has any number of ways that he can leverage that knowledge, wealth and expertise for the next generation aside from just turning over the keys. The retiree who has the wonderful beach cottage could create a family compound that is enjoyed and valued by future generations. The man who slowly built family wealth through shrewd investment management can impart those skills with those that he loves with the use of imaginative trust provisions.

When thinking about your own planning – I would suggest that you not think about your death so much as your life. What are your hopes and dreams for yourself and your spouse? In the next three years, what do you hope to do and to accomplish? What obstacles might stand in the way of those hopes and dreams? What opportunities exist that can help you overcome those obstacles? What are your existing resources that you can capitalize on but haven’t yet?

If you were to sit down and honestly answer those questions – I would suspect that you might become excited about the future. The future would look like it harbors all sorts of possibilities – as opposed to the same old stuff you’ve been caught in over the last several years.

After you’ve done that exercise for yourself – use your imagination to the benefit of your children or if you have them – grandchildren. What are your hopes and dreams for them? What do you hope that they would accomplish? What obstacles do they have in accomplishing their dreams? What resources are at their disposal and how might you compliment those resources?

When I speak of resources, by the way, I’m not necessarily talking about financial assets or wealth. The kid who has the drive and energy to put himself through college by earning good grades, getting scholarships, working part time jobs and supplementing all of that with student loans is a kid who has used all of the available resources that he has at his disposal.

I bet that you and your family have untold value locked up in your imaginations. I hope that you can have fun tapping it sometime.

Never Go Out Without an Umbrella

Many retirees figure that once they move past the stage in their lives where they were raising children, they can scale back on many of the expenses that they’ve been carrying for many years. Life insurance might not seem so important once you accumulate some savings and have enough for your own retirement and that of your spouse, if she or he survives you. Often retirees will downsize their homes to save on those carrying costs, including high homeowner’s insurance rates.

But there’s one insurance policy that retirees (and even people still in the middle of their working careers) shouldn’t scrimp on: umbrella insurance policies.

For those of you unfamiliar with this concept, umbrella insurance policies cover beyond what your homeowners and automobile policies cover. The typical highest liability coverage that standard automobile policies cover is in ranges of 300/500/100, which translates to $300,000 of bodily injury per person, $500,000 of bodily injury per accident and $100,000 of property damage.

Yet, what if you are involved in a terrible automobile accident and cause permanent injury to someone? Even though those liability protections seem like a lot of money, they are probably insufficient to protect you from catastrophic accidents. While you may believe that you are unlikely to experience such an occurrence, consider what liability you may have if you were to run into a surgeon and cause him permanent loss of the use of his hand. It doesn’t take a death to create significant liability.

If you were involved in an accident where your liability exceeded your coverage, then the insurance company might just settle the claim for their policy limits and let you handle the rest. This may also mean that you would have to incur significant defense attorney costs as well as subject your hard-earned net worth to the possible reaches of the claimant.

This is where umbrella liability protection kicks in. An umbrella policy will cover you for liability in excess of your car, homeowner’s, boat and other liability policies up to the umbrella limit. Typically, one can purchase umbrella policies totaling $1 million, $2 million or even $5 million of coverage. Unless you have a claims history, the cost of the coverage is relatively inexpensive. It might be a few hundred dollars annually or perhaps a little more if you want the higher coverage amounts.

While there is no requirement that you purchase the umbrella policy from the same carrier that underwrites your other insurance, I would suggest that you use the same carrier as the one that you have for your automobile policy. You don’t want to have a situation where the insurance carriers argue over who is liable for what, including your attorney defense costs. Since an incident involving your automobile is the most likely to create large legality problems, having that carrier underwrite the umbrella policy is probably your best choice, even if the umbrella is slightly more expensive.

No matter who you choose to underwrite your umbrella policy, you should ensure that your other coverage meet the umbrella’s stated requirements. In other words, once I purchase an umbrella policy, I usually can’t drop my automobile coverage limits to the state minimum.  Usually the umbrella policy requires that I maintain at least a 300/500/100 threshold on my automobile policy. Similar requirements may apply to my homeowner’s and boat coverage as well.

The final tidbit to know about umbrella coverage is the “uninsured motorist” or “UM” rider addition. While the standard umbrella pays someone that you may be liable to for negligence, the UM coverage pays you if someone injures you but doesn’t carry sufficient coverage of their own.  Many motorists in Florida carry the bare minimum of coverage, and if they cause you significant injury and if they have little or no assets (personal injury attorneys call these individuals “judgment proof” since even if you get a large judgment against them there is little or nothing to collect against) then you can’t get compensated for your losses. That is, unless you carry UM coverage on your umbrella. Then you can go against your own policy to the extent that the person who injures you is uninsured or underinsured. Most underwriters will only sell up to $1 million of UM coverage, and that will typically add several hundred dollars to the premium, but I believe it is well worth it.

So don’t give up that umbrella policy if you have any degree of net worth. If you have already dropped your umbrella coverage, or if you don’t have it, please consider speaking about it with your liability insurance carrier.


Back-Up Your Brain

Like many professional offices, ours has gone electronic and mostly paperless – at least as much as an attorneys’ office can actually go paperless.  So from time to time, a client will ask me whether and how we back-up our data and systems.

Thankfully, I can assure my clients that we have up-to-date, sophisticated off-site back-up systems.

But then I ask them the same question.  “How do you back up your data?”

I’m not asking, by the way, whether they have their computer data backed up. Instead, my inquiry is directed at what’s inside of their brain. By that I’m referring to the wealth of information that the client may have in their head, but that no one else knows – possibly not even their spouse.

What kind of data you ask? Think about all of the day to day decisions that you make regarding your legal, tax and financial matters.

What is your investment strategy? Where are the accounts? Which account is used to pay which bills?  Are electronic banking accounts used? What are the usernames and passwords? When you need to pay big-ticket items, such as real estate taxes, or for major repairs, what money do you tap?

When do you typically take your Required Minimum Distribution (RMD) from your IRA every year? Is it at the end of the year? Who calculates it? If there are multiple IRA and 401(k) accounts, is the RMD taken proportionately, or do you typically tap one of the accounts and leave the others intact?

Are there any financial dealings between you and your adult children? Are those arrangements written down? Where are they kept? Do they involve ledgers? Are those ledgers up to date? Who keeps them up to date?

Are there annual gifts being made for health or education?  Are those expected to continue? Are there life insurance premiums due? Are those premiums paid to a life insurance trust that requires Crummey notices that must be sent to the trust beneficiaries? Who is responsible for that?

The list goes on and on.

Since handling the finances of the house is so second nature to some, and because they have been doing so their entire adult lives, they don’t think that any of this is extraordinary. They don’t appreciate that someone coming in with no understanding of what they have done over the course of many years would have a difficult learning curve to understand what has transpired in the past, and what has to happen in the near term to keep things running smoothly.

And in most cases, there is no back-up.  All of this information is stored in the brain – but if that brain should have a traumatic event like a stroke, or worse, death, all of the loved ones who are affected by these daily decisions somehow have to reconstruct the data.

Believe me, it isn’t easy.

So if any of this sounds familiar, what should you do?  The first thing, of course, is to write down as much of the information and keep it in a safe place. Today’s technology offers a variety of solutions for backing up personal information securely.  Digital vaults for passwords and forms are freely available on the Internet.

Secondly, instruct those around you about the most important legal, tax and financial matters you deal with on a daily, monthly or yearly basis, and then have your loved one participate with you in carrying out some of these tasks. That way, should your loved one be confronted with having to pick things up should you be unable to act, it all won’t seem so foreign.

In other words, do your best to back up the data that sits between your ears. Thereafter, be sure to perform periodic back-ups since the data tends to change over time.

Home Is Where Rover Lives

Many who own residences both here in Florida and in some northern states often consider claiming Florida residency to save on taxes, among other benefits. Becoming a Florida resident is quite easy; escaping the clutches of your former state’s taxing authority is another matter.

Many states impose their own rules to determine whether you remain a resident, even if you changed your voter registration, driver’s license and performed a host of other activities. For a complete list of what you should do to become a Florida resident, check out Appendix B to my latest book The Florida Residency & Estate Planning Guide, available by calling my office or on

This brings me to the Matter of Blatt, which is a New York state court case. As you may be aware, New York taxes are quite high. In Blatt the New York State Department of Taxation and Finance considers an individual to retain New York residency if he or she continues to “hold [items] ‘near and dear’ to his or her heart, or those items which have significant sentimental value, such as: family heirlooms, works of art, collections of books, stamps and coins and those other personal items which enhance the quality of lifestyle [in New York].”

Factors considered also include retaining a home, the location of business activity, the location of family ties, the location of social and community ties and formal declarations of domicile. But here the court was asked to consider other items that were ‘near and dear’ to the taxpayer.

In this case, the taxpayer’s most important possession was his dog.  Mr. Blatt moved to Dallas Texas, another state with lower taxes than New York. The Division of Tax Appeals concluded that the significance of the taxpayer’s moving his dog to Dallas was reflected in an email to his friend in which he said that “the Dog is the final step that I haven’t been able to come to grips with until now. So, Big D is my new home.”

Moving Rover was therefore a significant factor in the New York State Tax Court’s decision in releasing the tax assessment and agreeing that Mr. Blatt was a Texas resident and not a New York resident.

The lessons to be learned in this ruling are significant.  If you claim Florida residency, for example, but retain your stamp collections, family heirlooms, works of art and other significant tangible personal property in your northern residence, there’s the chance that a northern state taxing authority uses those facts against you should an issue arise as to your residency for tax purposes.

In other words, just because you’ve registered to vote and obtained a driver’s license in Florida doesn’t seal the deal. I’m wondering what significance this decision would have on those who travel with their pets? I’ve spent a significant amount of time traveling recently and can tell you that there were about as many pooches on some of my flights as there were screaming babies and young children. Such is life in the skies these days.

As a side note—what’s up with all of these “Emotional Support Dog” vests? Those seem real fishy to me honestly. I love my dog, and he certainly serves as emotional support from time to time, but to get some kind of special treatment flying with him would seem like I’m gaming the system. Just saying.

So the bottom line is watch where you leave Rover. If his home is in another taxing jurisdiction, he may be costing you more than dog food and vet bills.

Second Language

I’m venturing away from my usual estate-planning topic as I write this on a bullet train between Madrid and Barcelona. While I’ve been, in Europe more terror incidents have occurred—one on the Champs Élysées and another near a North London mosque in an apparent retributive act against the London Bridge/Borough Market terrorist attack of a few weeks ago.

At least where I am things appear normal and calm. Many of our friends questioned why Patti and I would choose now to go abroad, just as they did when we traveled to Israel a few years ago. I’m not one to restrict my plans because of terrorist activities. In fact, my eldest daughter recently completed a college semester abroad in Morocco, a North African Muslim country. My family is Jewish. She spent the semester living with a Muslim family, gaining insight into their language and culture. She enjoyed her time there and made new, lifelong friends.

A few years ago my middle daughter completed a high school semester abroad in Israel. We were certainly concerned about terror while she was there in 2013, and we would have been even more frightened had she been there a year later when Hamas’ bombs from Gaza were raining down on Israel while the terrorist organization’s military underground tunnels were discovered. Yet I don’t believe even that would have dissuaded us from having her attend school there if she still wanted to.

The reason we’re in Spain now is to drop our youngest daughter off at a Spanish immersion course. She is a rising senior at Fort Myers High School’s International Baccalaureate program, where she excels in her Spanish classes. My family is fortunate to be able to do these sorts of things. We value how spending time in other cultures broadens ones views and outlook on life.

As far as terrorist incidents, my take is if we all change our plans or fail to make plans out of fear, then the terrorists have achieved their goals.

The real irony occurs when Americans choose to isolate ourselves. We elect xenophobic leaders and hold frantic rallies to limit immigration. Our colleges educate kids from all over the world, but upon attaining their degrees those same students have trouble becoming legal citizens. That’s nuts. Anyone smart enough to earn a college diploma should be welcomed here to develop their talents as they are in numerous other countries.

hold ourselves out as models for the rest of the world to follow, yet most native-born Americans lack the ability to speak a second language. I fumble around Spain speaking my broken-Spanish; nevertheless the locals are very kind and seem to appreciate my efforts. My daughter has bailed me out several times as she can conjugate verbs much better than I. When in a real pinch I’ll text my legal assistant Maria whose family is from Ecuador, or my friend Gus, a Fort Myers real estate developer from Cuba or even my friend Manuel, a local dermatologist who grew up in Puerto Rico. It’s so much better than Google Translate! Isn’t technology wonderful?

I’m amazed how most Europeans speak several languages fluently. I recognize how the proximity of different languages and cultures promotes that, in contrast to how we in America are separated by vast oceans from other lands. With a growing Spanish-speaking population, however, there is ample opportunity for any one of us to pick up at least some key Spanish phrases, yet many only want those immigrating from such countries to learn English.

You may have heard of Israel’s Birthright program that will pay for a trip to Israel for eligible Jewish students ages 18-26. The idea is to bond young Jewish adults to their heritage. American Jews often don’t understand the trials and tribulations of living in Israel. That program expands these kids’ understanding.

I realize the cost of trying to expand study abroad programs would likely be prohibitive, given the economic challenges facing our educational systems. Nevertheless, any investment that we as a nation could make in any expanded cultural exchange would pay dividends over time.

At the very least, I’m hopeful that as a nation we look to expand our understanding of other cultures rather than allowing the 24/7 news cycle of terror frighten us.

As for me, I’m looking forward to my Barcelona cooking class where we tour its famous Mercado La Boquería, pick out our ingredients and get back to the kitchen to cook some paella! Buen Provecho!


A new client, Theresa, who recently relocated from a northern state, brought me her trust as she wanted me to review it for applicability to Florida law. She dropped it off before her appointment so I could be prepared for our initial appointment together. I opened up the binder and started reading.


It took me three readings to figure out what Theresa’s intent might be. My suspicions were that if it took a board certified wills, trusts & estates attorney with almost thirty years of experience three attempts to figure out the language of the trust, Theresa probably had no idea what it said either.

I’m not trying to knock Theresa, by the way. Theresa is a very smart and accomplished woman. Even so, her field of expertise is not tax or trust law, and that’s why I assumed Theresa didn’t know what her trust said.

So when Theresa sat down in my conference room, I started to ask her some questions. Who did she want to run her financial affairs in the event she became incapacitated? Was there anyone else that she was supporting financially who might need continued assistance in the event of her incapacity?

Did she want someone different to be responsible for her business than the person who she wanted to be responsible for handling her investment assets? Did she want the person responsible for running her business to be able to purchase the business from Theresa’s estate in the event of Theresa’s incapacity or death? If so, how was the business supposed to be valued? Who decides what the terms of the sale would be?

The questions went on and on.

I’m not necessarily criticizing the attorney who drafted this trust – although I felt he could have done a much better job. There were just way too many ambiguities in the document – open holes that left too much up to chance. When I sat down with Theresa and started to ask her questions about what she wanted, the answers that she gave me didn’t coincide with what I read in her document.

There were many possibilities why this was the case. First, Theresa may not have expressed her intent clearly to her prior attorney. Maybe her prior attorney didn’t ask Theresa the questions that I was asking, which may have prompted completely different responses leading to a completely different answer. Perhaps Theresa forgot what she told her prior attorney and her intent changed.

This isn’t the first time that I’ve listened to a client express her intent, and when I read the client’s document the written words didn’t match what I heard.  It’s very important for clients to read through their legal documents, and, if they don’t understand the main points, to ask their attorney questions until they do understand.

When I send drafts to clients, we often include a brief summary of the trust along with a flowchart that describes what happens during incapacity or their passing. I know of other attorneys who also send flowcharts. Some people operate better with visual graphics than with words. I’ve found that when you combine a flowchart with a summary of the trust, more often than not people will understand what the trust is supposed to do.

Oftentimes clients, when asking questions, will start off the question with an apology. “I’m sorry to ask so many questions but….”

Don’t apologize! Ask your questions! That’s what you’re paying the attorney for! Make sure that the document your attorney drafted is consistent with your intent! If you don’t feel that you understand the basics of your document, then you need to ask more questions.

With that said, there will always be some provisions that you will never understand. Formula provisions that divide your estate into exempt and non-exempt tax shares come to mind. They are extremely complex and fraught with legalese. I don’t draft those types of provisions to satisfy a sadistic urge, (although others may disagree) – it’s just that if you don’t express that language correctly you could run into IRS or other legal difficulties.

But even with those types of provisions you should understand the generality of what is happening.

Do take the time to read through your estate planning document drafts when you receive them. Don’t be afraid to ask questions to make sure that the documents are consistent with your intent. Finally, do review your documents periodically to make sure that the intent you expressed before remains your intent today.

Should You Rescue a Child By Bringing Him into the Family Business?

You may be surprised to learn that more than 90% of American businesses are family businesses, according to Entrepreneur magazine. The term “family business” is defined as a non-publicly traded business that contains two or more family members.

It’s not unusual for a patriarch or matriarch to dream of one day including one or more adult children in the family business, especially if it’s successful. Many consider the business their legacy and are quite proud of it. Bringing in the next generation might be considered a logical step to solidify that legacy. Many of us know of family businesses that thrive for generations.

But there are many psychological, economical and relationship issues to consider when bringing loved ones into the fold. Is your adult child well-suited for the role that you expect her to play? What exactly is that role? Will she start from the bottom and work her way up, or will she immediately work from the executive suite? What is her educational and work experience to date? How will other key employees receive her? How has your relationship with that adult child been over the years? Can it survive working together?

Anecdotally, I’ve seen several instances of a child being forced into a role that he isn’t suited for. Dad, for example, might be great at sales, but Son might be better working in operations. When counseling family businesses, I usually suggest that all parties take certain aptitude and profile tests such as Strengthsfinder and Kolbe. Both provide valuable insight into a person’s proclivities.

Yet another issue to think through is who will train and mentor the young family member. Not only is it tough to mentor anyone, nonetheless your own flesh and blood, but you need to honestly assess your patience and tolerance as well as your adult child’s disposition and capabilities.  Perhaps another person in the organization is better suited for this role? Are they willing to do it? Do they see your family member as a threat?

Sometimes the family business is used as a life preserver for a drowning family member. Drama often ensues when the family business is used in this manner.

Perhaps the child was fired from several jobs or has been unemployed for a while.  The parents might believe that by creating a position inside of the family business the child will find a niche and thrive. This rarely happens. There’s usually a reason why Son or Daughter was fired from prior positions, and those reasons are likely to not only persist but also intensify in the steaming caldron of a family business.

I recently met with a client who owned a successful multi-million dollar operation that he took over from his father. “I thought one of my three children would one day run the shop,” he confided, “but none were really equipped to do so. I brought them all in at one time or the other, but when I did they started at the bottom and had to work their way on up to the top. None of them worked out. So eventually I sold the business.”

This client’s story is quite common. Success magazine recently published a report indicating that fewer than 15% of family businesses survive to the third generation. That statistic is important to note if you are the patriarch relying on future income of the business for your retirement.

Those family businesses that employ non-family members must be cautious as well. Long-term employees who are critical to the business’ successes may look askance at the youngster who hasn’t paid her dues but receives many privileges. This can create disharmony which can lead to the loss of those key employees. Consequently, it’s usually a good idea to communicate with those that matter, soliciting their input.

Non-family owners complicate matters as well. Here the ownership interests might be governed by shareholder or partnership agreements. Assuming that nepotism is not prohibited, bringing on a competent family member on one side might encourage other shareholders to ask the business to employ their own family members who may not be right for the role. Business owners would be wise to keep that Pandora’s Box closed.

As you can see, there are many issues to address prior to asking a loved one to join you in your business. Being intentional and thinking through the myriad of issues will assist in arriving at the best outcome, whether that result is bringing your son or daughter into the business or deciding against it.