Kelly B. Myers, Personal Family Lawyer
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Does anyone still spank children? 

2/28/2014

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Pediatrician Dr. Bill Sears is the author of more than 30 books on childcare, has appeared on dozens of national talk shows, provides medical and parenting guidance for Parenting and BabyTalk magazines, received his pediatric training at Harvard Medical School’s Children’s Hospital, is an associate clinical professor of pediatrics at University of California, Irvine School of Medicine and raised eight kids of his own – three of whom are also pediatricians.

He recently authored an article on 10 Reasons Not to Hit Your Child.  And I’ll be honest, I was surprised an article like this still needs to be written.  And, I imagine for my readers, it’s probably not because you understand that the legacy you are leaving happens in the now moment and it starts with how you are with your children. 

Creating a bond of secure attachment and unconditional love (without codependence or enabling) with your children is the greatest gift you could leave the world.  So, if you, or anyone you know, does think hitting a child is acceptable behavior under any circumstances, here’s the first 5 of 10 reasons to rethink that thought.

And, just for fun, add the word “yelling” or “yell” to each place it says “hitting” and “hit” -- hitting and yelling have the same effect in the nervous system of a child.

1.  Hitting models hitting.  Children love to imitate so when you hit a child, you are teaching them it is OK to hit someone when they are angry or frustrated.  This is not behavior we want to see more of in the world, right?

2.  Hitting devalues a child.  A child’s self-image is formed first by his or her parents; hitting your child tells them you think they – and not their behavior – are bad.  Instead, consider focusing on the activity that you do not want to see repeated and discussing why that activity does not get them more of what they want.

3.  Hitting devalues a parent.  Parents who hit their children harm themselves because deep down they know it isn’t right.  Anytime you are engaging in any activity that you know inside isn’t right, you will feel insecure about yourself as a person. And that’s one of the biggest barriers to success.  The good news is that you can so easily turn it around by doing only things you know deep down are right.

4.  Hitting can lead to abuse.  Hitting can escalate into other abusive behavior. The worst part is that you may even convince yourself that the abusive behavior is justified. It never is. Criticizing, hitting and otherwise shaming our children is abusive. Just don’t do it.

5.  Hitting doesn’t improve the behavior.  Spanking actually makes a child’s behavior worse since they believe the punishment is unjust.  When someone believes a punishment is unjust, they don’t change their behavior, they just do it more.

You don’t need to hit to get your point across. If you are hitting out of anger, seek help.  There’s no shame in asking for support.

Next week, I’ll be back with 5 more reasons not to hit (or yell at) children. In the meantime, if you need support with leaving a legacy of love to the people you love most, schedule a Family Wealth Planning Session.
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Receiving an Inheritance One Day? Here’s What to Do Now.

2/21/2014

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Baby boomers are set to inherit up to $8.4 trillion over the next 15 years, according to The Center for Retirement Research at Boston College.  A recent New York Times article explored the complicated issues that these inheritances can bring, including transferring the emotional attachment you had to your parents to what they have left you.

The Times article found that some boomers tend to get “stuck” when deciding what to do with their inheritance, letting large sums languish in low interest accounts for years.  Others use the windfall to open their lives up to new possibilities, like starting a business or even retiring.

Here are some tips on how boomers should plan for an inheritance:

Create your own estate plan first.  You may be expecting an inheritance, but no one knows what the future will bring so create your own estate plan first.  Part of your estate planning should also include a prospective plan for your future inheritance.

Do some tax planning.  Inheritances can include cash, property, a valuable collection, investments or real estate, so the assets contained within your inheritance need to be examined for potential tax liability. 

Look to the future.  Many boomers feel an obligation to protect the inheritance for their own children, while others may have charities or other plans for what remains after they are gone.  Your own estate plan should address ways to protect and pass on your assets in the most tax-advantaged way possible.

Financial experts advise that boomers should not just sit on an inheritance, but instead explore ways they and their loved ones can best benefit from it.  Inherited money should not be treated as a memorial; instead, use it as your parents no doubt intended it – as a way to make a better life for yourself and your family.

To learn more about putting the proper legal and financial protections in place for your family, contact our office to schedule a time for us to sit down and talk.  We normally charge $750 for a Family Planning Session, but because this planning is so important, I’ve made space for the next two people who mention this article to have a complete planning session at no charge. Call today and mention this article. 

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5 Fast & Furious Estate Planning Lessons from Paul Walker’s Estate

2/18/2014

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Paul Walker, who starred in the Fast & Furious movie franchise, died tragically in a high speed car accident in Los Angeles last November at the age of 40.  His estate was opened at the end of January in the Superior Court of California, County of Santa Barbara probate court, revealing that he left assets of approximately $25 million.  His survivors include his 15-year-old daughter Meadow and his parents.

A recent Forbes.com article listed five estate planning lessons to be learned from Paul Walker’s Estate:

Leave assets in a trust.   Paul Walker created a pour-over will that left his assets in a revocable living trust, intending to avoid the Court process, called probate, that (when handled properly during life) makes everything totally private and keeps it all out of Court.  Unfortunately, while Paul Walker had a Trust, it wasn’t properly funded … and this is an all too common estate planning failure, even when working with a lawyer.

Most lawyers simply do not handle funding of assets, the single most important part of estate planning, because they’ve been trained to be document drafters, not consigliere.  

Fully fund your trust.  The contents of Walker’s estate, who will inherit it and when  are public knowledge because Walker’s lawyer didn’t take the necessary steps to make sure his Trust was properly funded.  Sadly, this isn’t even a case of malpractice (though it should be) because it’s common practice in the world of estate planning lawyers.

When you do estate planning (or if you already have), the most important thing you can do is ensure your assets are transferred properly.

Name guardians for minor children.  Walker’s daughter is still a minor, and he did name his own mother as the guardian for his daughter Meadow in his will.  Meadow’s mother is still alive, so the grandmother will likely not assume guardianship unless Meadow’s mother is found to be unfit.

Don’t wait to do estate planning.  Walker was 28 when he created his will in 2001, the year the first Fast & Furious movie debuted.  While we will never know what prompted him to create an estate plan so early – perhaps it was his young daughter or a feeling that his star was on the rise – he did the right thing in planning early, especially considering his untimely death.

Keep estate plans updated.  Not only did Walker’s attorney not ensure his assets were titled properly, but he never updated Walker’s estate plan from the original version created 12 years before he died. 

Walker’s net worth changed significantly during that time, and so did his estate tax status.  If his estate is $25,000,000,  as we’ve read, his family will pay over $5,000,000 in estate taxes.  We think that’s unconscionable because with proper planning that could have all been structured to pass on to his family instead of the Government.

If you would prefer your family to receive what you are passing on, instead of it ending up in Court, conflict or the hands of the Government, you must update your estate plan at least every three years, and ideally you will review your assets and important changes every year.

To learn more about putting the right legal and financial protections in place for your family, contact our office to schedule a time for us to sit down and talk.  We normally charge $750 for a Family Planning Session, but because this planning is so important, I’ve made space for the next two people who mention this article to have a complete planning session at no charge. Call today and mention this article. 

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How to Protect Life Insurance Proceeds from Taxation

2/17/2014

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If you have been responsible enough to purchase a life insurance policy as added protection for your loved ones, then you will want to carry that responsible action a little further by protecting that important payout from taxation.

If you are married and have named your spouse as the beneficiary of your life insurance policy, those proceeds will pass free of both income taxes and estate taxes.  However, if your children are named as beneficiaries, the proceeds are free of income tax, but they do become part of your taxable estate.  Estate taxes have ranged from 35% up to 55% in recent years, so that’s a big bite.

An Irrevocable Life Insurance Trust (ILIT) is a great asset protection tool that protects your life insurance from estate taxes, and when drafted properly, can also be used to protect proceeds from creditors, bankruptcy and divorce. 

The best way to use an ILIT is to have the Trustee of the life insurance trust purchase the life insurance directly and pay all premiums. If you already own the life insurance, your ILIT Trustee can either buy the policy for you, or you can transfer it in, by following certain rules we can help you with.

So why is this a good idea? The proceeds from the life insurance are not part of your estate if the ILIT owns the life insurance.  Therefore, they are not subject to estate tax upon your death. 

If you have not yet purchased life insurance, you should create your ILIT first.  Have your ILIT purchase the life insurance.  This will circumvent the transfer of life insurance from you to another party, thus avoiding any difficulties if you do unexpectedly pass away since the proceeds of your life insurance policy would revert to your estate if you died within three years of the transfer.

The ILIT is a phenomenal tool for protecting your life insurance from taxation, leaving behind more for your loved ones.

To put the proper legal and financial protections in place for your family, contact our office to schedule a time for us to sit down and talk.  We normally charge $750 for a Family Planning Session, but because this planning is so important, I’ve made space for the next two people who mention this article to have a complete planning session at no charge. Call today and mention this article. 

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