Dictionary.com defines “Symbiotic” as: “…having an interdependent relationship.”
By Steven J. Gibbs, Esq.
Self-help Guru Stephen Covey writes a great deal in his book “The Seven Habits of Highly Effective People” about how “interdependence” is vital and involves working in a “synergistic way” with the world around us.
Google defines “synergy” as “the interaction or cooperation of two or more organizations, substances or other agents to produce a combined effect great than the sum of their separate effects.”
We often do not see things as symbiotic, interdependent, or synergistic. Rather, we tend put things into separate broad categories so life becomes easier to understand. In the world of estate planning, this tendency can result poor planning by “asset protection” being allocated to a category that is separate from “estate planning”, and “elder law” being put in a separate category from both.
As a result, when folks seek estate planning, they often are only thinking about getting some basic estate documents such as a “last will & testament” or a “durable power of attorney”, and they may not be thinking about preserving assets from exposure to lawsuits or the ramifications of Medicaid if the need for long term medical assistance arises.
I have written about this in the past and I repeat it because it is so important and it underlays my philosophy as an estate planning attorney to assure that a client considers 360 degrees of protection. For my “newbie” readers, by referring to 360 degrees of legal asset protection I mean that 4 basic quadrants of a circle should be consider which are:
1. Wills, Trusts and Ancillary Estate Documents
2. Protection of Personal and Business/Investment Assets From Lawsuits
3. Medicaid and Long Term Medical Care Planning
4. Planning for Probate and Trust Administration
So to paint a clearer picture of how this works…
Putting together the basic estate planning documents is a first step. In a previous blog, I wrote about 3 basic documents for 3 big life events. The 3 documents are the last will & testament, the durable power of attorney and the advance medical directive and the life events are death, disability and incapacity. Of course this approach is a simplification and yet it is a good start for anyone seeking to understand estate planning.
From here we add the possibility of using a revocable living trust for pre-probate avoidance planning and also to add another layer of protection for
pre-disability and incapacity planning. Essentially, if all assets are titled in a revocable living trust, then the need for probate may be eliminated and the successor trustee can “step in” to care for beneficiaries (you are “grantor” and the initial beneficiary) who are disabled or incapacitated and this is a better scenario than simply relying on the power of attorney or medical directive because the successor trustee has a “fiduciary duty” to you as the beneficiary.
From here, we move on to address asset protection concerns. Your revocable living trust can provide asset protection for your heirs and a well-drafted revocable living trust should provide for this protection. A revocablee
revocable living trust does not protect you as the “grantor” from lawsuits and so other steps should be taken to provide for this protection. Utilizing a good “asset protection LLC” may be a great step for protecting your investments, business assets or high value personal assets. However, just filing an LLC is not enough because 90% of the protection is in the “Operating Agreement”. The Operating Agreement for your LLC may also circle back to address your estate planning concerns which are typically what will happen if the business owner (LLC Member) passes away or becomes disabled or incapacitated.
Of course all of this merges into another quadrant which is pre-probate avoidance and trust administration planning which is essentially what happens upon the death of a loved one? Pre-Medicaid planning, our fourth quadrant, is often easiest for estate planners to miss as I discussed in a previous article. Assets may need to be transferred between spouses or converted to protected assets in order to protect against the liquidation of assets for long-term medical care costs.
Is the symbiotic interdependent relationship between these four areas beginning to unfold yet? I hope so, because this “synergy” is critical to your creating a complete estate plan for your loved ones.
As always, I hope this was helpful.
Until next time…
Steven J. Gibbs, Esq.
Steven Gibbs founded the Gibbs Law Office in January 2009, committed to providing client-centered legal services.
Steve as he would rather be called, is not your typical attorney. If you appreciate the staunch egotistical mannerism of most firms, you will be delighted with Steve’s unpretentious approach to educating and then assisting his client. Instead of giving you his complacent and lofty ideas, he would rather pursue your expectations with professional conversation about resolving your concerns under the Law. It’s your life and it’s his job to make your legal expectations come true while using years of his guidance and knowledge.
Steve was admitted to the Minnesota Bar in 1999, the Florida Bar in 2007 and was recently admitted to the California bar. Keeping abreast of law changes in these three States, as well as the United States, assists him in all aspects of the types of law the firm practices.
Along his career path, he was an associate attorney for an insurance defense law firm; an in-house real estate negotiator for Target Corporation; and corporate counsel for Civix, LLC and Vice President for North American Properties where he was responsible for various real estate transactions, including legal issues and negotiating unresolved business issues. Prior to opening Gibbs Law Office, PLLC, he was an associate with the firm of Roberts & Engvalson, P.A. where he gained his knowledge of trusts, estate planing and Wills. He opened his own firm in 2008 and now focuses on laws that will enrich the needs of his clients throughout their lives and those of their children. The firm has developed a practice dealing only with Trusts and Estate Planning, Wills, Medicaid Planning, Elder Law, Real Estate, Business Law and Probate.
Quoting from Steve “I decided to practice in areas that families will need as they progress down life’s path. To help them with a solid foundation that will carry them throughout there lives is a rewarding experience for me and my staff.”
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