From a financial or physical wealth perspective, there are three questions every estate plan donor must answer:

1. How many of the resources God has placed in our hands do we need in order to live our lives as we believe we ought?
    
2. How many of the resources God has placed in our hands do our heirs need in order to help them live their lives as we would want them to be able to live?

   And, Read the rest of this entry »

Growing up, my mom taught me a song to be sung to the tune most of us know as “Jingle Bells”:

J-O-Y. J-O-Y. J-O-Y spells joy.
Jesus first, Yourself last, and Others in between.

The priorities and values certainly appear correct according to most Scriptures of which I am aware:

Mathew 6:33 – [S]eek first [God']s kingdom and His righteousness, and all [the food, drink, clothing, etc., you need] will be added to you.

Philippians 2:3 – Do nothing out of selfish ambition or vain conceit, but in humility consider others better than yourselves.

And so forth.

But then Jay Link comes along and says this advice is all screwy when it comes to legacy planning. Certainly when it comes to the O and the Y. Indeed, he says, the first priority in estate planning/legacy planning is–it has to be–to ensure the physical and financial needs of the benefactors are met. The second priority is to meet their heirs’ needs. And then–and only then–is it legitimate to consider the needs of others.

If any legacy planner were to attempt any other order–”Others before Yourself”–you can be confident, Link says: “The plan won’t be implemented.” And an unimplemented plan is no better than no plan.

“Oh! Horrors!” I thought when I first came across Link’s suggested priority order a year and a half ago or so. “It’s so . . . selfish!” (So opposite what my mom’s song taught!)

But over time I have come to realize how wise Link really is.

1. It is not “unrighteous,” “ungodly” or “unbiblical” to make sure your own needs are taken care of.

   According to 1 Timothy 5:8, “[I]f anyone does not provide for his own, and especially for those of his household, he has denied the faith and is worse than an unbeliever.” –So by making sure you have taken care of your own and your heirs’ needs, you are actually fulfilling the “law of Christ.” You are ensuring you do avoid becoming an unnecessary burden to those around you.
    

2. As far as placing yourself before your heirs, Jay made a comment about how most parents love their children very much but are unwilling to forego their own comfort in order to increase their children’s at some unknown future date.

   I was going to quote him to that effect and leave it there, but it just struck me: that attitude may be neither biblical nor true.

   I know a lot of parents through the years who have made tremendous sacrifices in behalf of their children. They do this when their children are infants. They do it when their children are growing up. They do it again when their children have children of their own.

   I’m not saying such attitudes are ubiquitous. But many, many parents–I think of immigrant parents, especially, but lots and lots of moms, too–make all kinds of sacrifices in behalf of their children and grandchildren.

   Still. And, I’d say, especially for parents who are concerned not to place a burden upon their children, there is something to be said for making sure your own needs are taken care of so you don’t place an unnecessary burden upon your children.
    

3. As far as Jesus being first, I thought Link’s company mission statement said it well. He quotes 1 Timothy 6:17-19:
   

   Command those who are rich in this present world not to be arrogant nor to put their hope in wealth, which is so uncertain, but to put their hope in God, who richly provides us with everything for our enjoyment. Command them to do good, to be rich in good deeds, and to be generous and willing to share. In this way they will lay up treasure for themselves as a firm foundation for the coming age, so that they may take hold of the life that is truly life.

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Second in a series of posts inspired by a presentation by Jay Link of Kardia Family Wealth Planning. First post in the series: Two family CEOs.

Our legacy planners have urged us to create an Investment Policy Statement (IPS) that would enable outside onlookers (like my wife and me and/or our legacy planners, for instance) to say, “Yes, [our investment advisor] is living up to the requirements of our IPS. He or she is investing according to policy.” Or, “No. He has violated this parameter. He needs to come back into line.”

Right now, we have no such statement and, as a result, we can’t really be sure whether and to what extent our investment advisor is pursuing a particular plan or simply “going with the flow” of whatever happens to cross his mind at the moment.

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Originally, our legacy planners asked our investment advisor to give them copies of his current investment policies for our various accounts.

And our investment advisor objected to what looked like an attempt on their part to “butt in” on his area of expertise. “Why do they need to know about my investment policies? What does that have to do with legacy planning?” he asked.

Part of his concern arose from the fact that our legacy planners work for a firm that, in addition to legacy planning, offers investment advisory services. He was concerned they were “simply” going to attempt to second-guess him and, with 20-20 hindsight, demonstrate what a bad job he has done in the last year in the midst of our rather unprecedentedly awful market performance.

Our legacy planners were able to put that fear to rest. “We are not looking to steal your business. We charge the high fees we do so that we have absolutely no need to sell other services. Our services are completely separate from the ‘other side’ of the company. . . .”

Still, the question remained: “What does an investment policy have to do with legacy planning?” Read the rest of this entry »

My wife and I have seen this in the past. I was “just” floored, yesterday, when we saw once more how different advisors’ perspectives can impact one’s plans . . . for better or worse.

Yesterday, our legacy planners wanted to discuss what they characterized as “wealth planning” “to ensure that there is a legacy to plan.” –Especially in these uncertain and highly volatile times, they noted, we must pay particular attention to our cash and near-cash assets.

That all sounded well and good.

But then it hit me. About halfway through the meeting, I held up my hand. “Hold on a second. I just want to make sure I’m hearing you accurately and fully understanding what you are talking about. Read the rest of this entry »