This is one in a series of articles reminiscing about growing up in small town America in the 50’s and 60’s…
I hated January! I was a skinny kid, without much natural insulation, so the grey, cold days of January back East were about my least liked ones of the entire year. January was downright dreary, a letdown after the festive holidays of December were gone, the cheerful lights adorning the neighborhood houses came down and a nice, long vacation ended with the inevitable trudge back to school.
But, as much as I hated January’s cold weather, I prayed for it! Well, actually I prayed for January’s snow! Not because of the indescribable joy of waking up to houses, trees, cars, and everything else draped in a glistening, white blanket. Rather, because of the indescribable joy of a “snow day”– a day off from school! (Some readers may recall that I grew up in the southern part of New Jersey and think there’s never much snow there, but I just checked and the forecast for tomorrow in my hometown of Vineland is a high of 37, low of 27– and a 60% chance of snow!)
The thrill of waking up at the break of dawn to freshly fallen snow was almost as good as the excitement of Christmas morning. On most school days you couldn’t get my brother, sister, and me out of bed with a cannon blast, but on a snow day we would rush downstairs — not to a tree with presents under it– but to turn on the family’s big, glass-tubed radio. If we were lucky, our school’s name would be called out, along with that beautiful word “closed”! (When I got a little older, we would skip the trip downstairs and merely huddle under my blanket to secretly listen on my new gadget, a transistor radio.)
Once we heard the word “closed”, we all rushed to get ready to make the first tracks in the pristine snow. It was quite an ordeal, like layering on suits of armor for battle (which was partially the case, as I’ll explain later)! There were the required long johns (thermal underwear), sweater, 2 pairs of pants, long sox, shoes, boots, overcoat, gloves, and woolen cap — all to get on (hopefully in that order). And, of course, Mom wouldn’t let us out till we had our breakfast too!
When we finally opened the door and dove out into the snow, there was sort of an understood agenda of activities. First, build a snow man for the youngest to enjoy. Second, throw snow or snow balls at each other and try to bury each other in the snow. (That may have come first). Then right after the plow trucks came through to clear the streets, the neighborhood boys would head off to go sledding. We didn’t have many hills or roads nearby, so we used the snow banks on the side of the road to launch us down street inclines and around curves (with one or two of us watching out for cars!). If you were lucky, you had an “American Flyer” and could actually steer around a curve (but others delighted in merely crashing into the snow banks!).
After all that, it was time for a lunch break. Boy, did Campbell’s vegetable alphabet soup hit the spot then! (By the way, Campbell’s actually had a factory in my hometown because of our famous Jersey tomatoes). But the main event was still to come — fort building and all-out snowball warfare!
This was serious stuff: The oldest and biggest boys were the “generals” in charge of the fort locations and construction. The younger boys, along with the girls, started making and stacking ammo (snow balls) inside the fort. Then it was on! No rules, just snow mayhem! Everyone got into the act, even my dog George. Once the last snow ball was thrown and the forts were crushed, we then turned our attention on chasing George around until we tackled him and formed a big heap of bodies covered with snow!
These snow days surely were wonderful times, but as I grew into my teenage years, the magic of all that seemed to vanish. There was too much snow to have to shovel off the sidewalk and driveway. (Which now, since I was the oldest son, became my job and no one had riding blowers then!). The beautiful, fresh snow seemed to devolve into disgusting, black slush in no time. And it was cold outside (which I remembered I didn’t like).
That’s why, as I got older, I preferred to stay inside — particularly on January 1 once our family got a color TV. (Remember, once upon a time, when there were only 3 stations, all in black and white?). The reason to stay in and watch TV was the Rose Bowl parade and game, broadcast from sunny Southern California! I remember thinking (and may have even asked my parents one time). “Why can’t we live there?” (To which I was greeted with a blunt “NO!”). My memories of watching that warm weather parade and game, while it was cold and gray outside, were literally my motivator to eventually come out to California, where as it turns out I formed my own Law Firm and some 33 years later, am here writing this article to you today! So, looking back at it all, I have to say I still hate the cold but “Thank you, January!”
What are your childhood January memories? We are always helping our clients pass down a financial legacy, but rarely do people pass down these great personal stories to the next generation and the one after that. Share your reflections with your loved ones (and if you’re brave enough, send them in and we’ll publish them in a future newsletter — anonymously, if you’d prefer!)
The Will To Plan & Choosing Financial Fiduciaries
Despite the hectic pace of life in America today, most of us still enjoy a fair amount of leisure time. Almost all Americans (95 percent) engage in some sort of leisure activity every day. In fact, according to the Bureau of Labor Statistics we get about five hours of leisure time a day, and spend most of it (almost three hours) watching television. The rest of the time we are doing other activities like reading, relaxing and thinking, socializing, playing games, surfing the web and participating in sports and exercise.
Conspicuously absent from that list is estate planning. Americans are almost overwhelmingly opposed to the idea. Harris Interactive recently polled more than 2,000 adults on the subject and found that 28 percent of us would rather do anything else and nearly one-third said they would rather do their taxes or get a root canal.
Most Don’t Have a Will
Little wonder then most of us (61 percent) don’t even have a Will, one of the most basic of estate planning documents. Dig a little deeper, though, and the numbers are even more disturbing. Among parents with minor children in the household, only 30 percent have a Will – the most universally accepted legal document for naming back-up parents in the event the children are orphaned.
Of course, Wills are not the only documents needed to protect you (and your assets) in the event of death or incapacity. Another Harris survey found that only 29 percent of us have a Living Will to direct end-of-life medical procedures. Even older Americans are hardly prepared. The same Harris survey found that only 48 percent of those over age 65 have a financial power in place authorizing someone to make financial decisions for them if they are incapacitated and only 51 percent said they had a healthcare power in place.
Even though estate planning is not on anyone’s list of Top Ten Favorite Activities, most of us realize the need to get at least basic planning in place to protect ourselves, our loved ones and our assets from life’s uncertainties (and the one certainty of death). And yet, most of us haven’t done it.
Despite Good Intentions
Why not? The number one reason, given by more than 55 percent of respondents, is simple procrastination. Most people say they just haven’t gotten around to it.
If you’ve ever made a New Year’s Resolution, you know we all have good intentions … but our follow-through could use some work.
Piers Steel, a psychologist at the University of Calgary and one of the leading experts on procrastination says it’s a “common pulse of humanity” to procrastinate, despite our best intentions. “One thing that defines procrastination isn’t a lack of intention to work,” Steel says. “It’s the difficulty of following through on that intention.”
Steel goes on to say that for most of us, procrastination isn’t a pleasant experience. It’s a feeling of growing pressure – of knowing we will have to deal eventually with whatever it is we’re putting off … like creating the necessary legal documents to name back-up parents for minor children, state our preferences for end-of-life medical care, designate financial and health care decision-makers in the event of our incapacity or death, and outlining a plan to distribute our assets after death. As difficult as those decisions can seem – putting them off by procrastinating only adds to the pressure and makes us feel worse. In fact Steel writes in his book, “The Procrastination Equation,” that procrastination leads to lower overall well-being, worse health and even lower salaries.
If you have resolved to get your estate plan in place this year – good for you!
Now, here’s a plan to beat procrastination: Steel says the trick is to reframe broad, ambitious goals into concrete, manageable, immediate chunks.
So, instead of saying, “This year, I’m going to get my entire estate plan in order,” break that down into smaller, less formidable goals. For example, the first step is to make a call and schedule an initial consultation. Don’t let yourself get stalled by thinking of all the decisions you will have to make to complete a comprehensive plan. Focus on one quick, easy decision.
Pick up the phone.
Choosing Financial Fiduciaries
Sometimes we procrastinate because we really do not know how to make, or do not want to face difficult decisions. Few Life & Estate Planning decisions are more important than the selection of your financial fiduciaries. After all, they will be responsible for taking care of your assets if you become incapacitated and upon your death.
Financial fiduciaries are responsible for making your financial decisions when you cannot due to death or incapacity. For example, after death, your fiduciaries will safeguard, manage and distribute assets to your heirs after ensuring compliance with all tax laws and satisfying your legitimate creditors.
You may have heard the terms, fiduciary obligation or fiduciary duty, which means that fiduciaries have a legal obligation to act in the best interests of another party. As such, they are held to the highest legal standards of conduct. This fiduciary duty even extends to the rights of third parties, such as the IRS.
Along with the honor of being named a financial fiduciary comes the potential for personal liability. For example, the Internal Revenue Code holds a fiduciary responsible for: filing final income and estate tax returns, representing the estate in all tax matters, and satisfying any federal tax deficiencies before any other debt. A fiduciary who fails to abide by these requirements may be held personally liable for any tax deficiency.
Understanding the risks and responsibilities may help guide your fiduciary selection. While your first thought might have been to name a family member as your financial fiduciary, you may want to think twice. Naturally, our family members likely know and care about us as no stranger could, but serving as a fiduciary can be an overwhelming responsibility, especially when your fiduciaries have their own busy lives to run.
Perhaps third party professionals may be more appropriate financial fiduciaries for you, whether a corporate fiduciary, accountant, or attorney. These professionals bring resources to the fiduciary role few family members can. It is their daily business to manage client assets and ensure compliance with all tax laws. Also, if these third party professional fiduciaries are unrelated to you and your family members, certain valuable asset protection strategies may be available to protect and preserve your estate.
The Team Approach
A popular alternative is a team approach where you select both a family member and a third party professional to serve as co-fiduciaries. The family member takes care of the non-financial people concerns and the professional takes care of the financial details. Such a combination also helps preserve family relationships when someone must tell a youthful beneficiary that a shiny red sports car is not within the letter or spirit of authorized trust fund expenditures.
Choosing appropriate financial fiduciaries is critical to the ultimate success of your Life & Estate Plan. But don’t let this decision become your excuse to procrastinate. Remember, you don’t have to make these decisions alone when you engage an experienced estate planning attorney to help you.