We’re very excited to be back with Merrell Bailey, a seasoned estate attorney, CPA, and MBA. Merrell joined us on the podcast earlier this year, and is here to share more of her estate planning wisdom with us today. Listen in as she debunks the misconception that estate planning is only for the ultra-wealthy and explores some of the unique parts of the process, like planning for your pet’s welfare in the event that something happens to you. We also touch on the importance of managing your digital legacy in the age of social media and online assets, offering insights and actionable advice for ensuring your loved ones can access your digital life when you’re no longer around.
Subscribe & Follow On Your Favorite App:
Note: This transcript was produced using AI, so please excuse any typos and inaccuracies…
Marc Killian 00:11
Welcome into this edition of plan wise retire free with Jude Wilson, holistic wealth manager at centrist financial strategies. And then we’re gonna do a two part episode here on the podcast for the next couple of weeks on estate planning. And we’re happy to have back Merrell Bailey with us, again, to join us on the show as we talk about this. And so we’re going to split this up into two sections. I’ll let you take it away here in just a second. So make sure that you subscribe to the podcast on whatever platform you like using Apple, Google Spotify, you can find all of the information or just get in touch with the team by simply finding them online at centrist fs.com. That is centrist. fs.com. Let’s get rolling with part one. Take it away June.
Jude Wilson 00:51
Well, welcome everyone. This month is a state planning month, and we have our Estate Planning guru back. I love Merrell She is not your typical stodgy estate planner. When you think of estate planning, you think of some old guy sitting behind a desk. Merrell is not that type of person. Is that right?
Merrell Bailey 01:13
I am not an old guy. I’m not a guy.
Jude Wilson 01:19
No, you’re not. Oh, so we welcome you back to our podcast. Thank you so much for sharing your time and your knowledge with us. So this being estate planning month, we want to talk about some specific issues. And I find from our audience, when we tell stories, in addition to the issue, it helps bring that issue alive. So many people think that estate planning is only for the super wealthy. I’m going to give you a story about one of those people that are super wealthy, but then we’re going to talk about some issues that may address just about everybody or someone that you know, for instance, going into someone that’s super wealthy. If you’re a football fan, you may recognize the name Joe Robbie. Joe, Robbie practically owned a Miami he owned the dolphins. He owned the stadium. But Joe Robbie did not do proper estate planning. Merrell, are you familiar with Joe Robbie?
Merrell Bailey 02:17
I know who Joe Robbie is. And so
Jude Wilson 02:21
let’s talk a little bit about what happened with Joe rabbit because Joe Robbie was a billionaire and did not do proper estate planning. And because of that, Joe, Robbie had to sell off the dolphin. Well, Joe Robbie’s beneficiaries, sell off the dolphins the stadium and much more. Give us a little insight on that. Where did he make a mistake? How could they have prevented that?
Merrell Bailey 02:47
Well, I’ve always found that a little bit of work upfront saves you a lot of work later. And you know, I don’t know the family. I don’t know the the specific was on his attorney. But what I find a lot is people are not comfortable talking about the situation. I don’t know why none of us have ever gotten out of here live yet. But everyone thinks that they’re going to be the one perhaps I don’t know. But if you spend just a little bit of time in advance, doing some basic paperwork, it’s worth hours and dollars and peace of mind and lots of less burden to your loved ones. And when you don’t do that there are consequences and those consequences can be discord amongst the family members. It can be an unfair burden of paperwork on one member of the family and the other ones are all thinking why are they taking so long when they have no idea how much paperwork get involved, and it can be taxes. So there’s all sorts of things that went on. And the problem is with particularly with the ultra wealthy when you have a taxable estate, which is anyone who has over 12.92 or $3 million, or as a married couple may still have $26 million in wealth, every dollar over that is taxed at 40 cents on the dollar and that tax bill is due in nine months. After that. There are no extensions. You can extend the filing of the estate tax return, but you cannot extend the filing of the tax do itself. And so now you’ve got a family that is coming up with cash because the IRS does not take promissory notes. And they don’t take stadiums. So they’ve got to liquidate things to come up with cash. And the sharks are circling because they know the family needs to come up with cash and they’re offering a reduced price because they can sell quickly. It’s just a very bad situation and it can be avoided.
Jude Wilson 04:44
Yeah, that’s exactly what happened in Joe Robbie’s situation. The family had to basically had a fire sale, and they had to come up with money quickly. So even though you and I couldn’t write a check for the dolphins the people that circled around the sharks actually got a great deal on the stadium, the dolphins and other assets, because they had to transition that money quickly into cash to pay off the IRS. And so we want to avoid that. But the other thing that you brought up that I thought was really significant was the estate tax credit. And what I find is a lot of people are afraid they might have to pay, their heirs might have to pay estate taxes. But really isn’t that a small portion of our society that will ever get to the point where they’ll have to pay estate taxes,
Merrell Bailey 05:35
not just small, I mean, in potassium, or, you know, hundreds of people, maybe a couple 1000 people in the entire United States, millions of people, it is just most people don’t have $26 million as a married couple.
Jude Wilson 05:50
Exactly. And so I want to take that fear off the table for all of our listeners, that more than likely, your family will not have to pay estate tax. So don’t listen to scare tactics out there, talking about the fact that you need to do some planning in order to prevent estate taxes. And they’re like you said, there are a few fact I met with a client today that will definitely have an estate tax bill. So if you’re not addressing a state tax, there are really other issues that families need to address in their estate planning. And let’s talk about some of those issues that may affect everyday people like you and me. Now, I don’t have any pets. But I know you love your dogs. And so when you’re addressing state planning for everyday people, and people who have pets, do have some discussion around that. Do you have some stories to tell us?
Merrell Bailey 06:42
Well, sadly, Abraham Lincoln, the 180 pound Great Dane is not here in the office with me today. So he cannot do a cameo. Maybe next time. But you know, people do have pets, they are part of the family. And I have that discussion all the time. Because what I asked people is, you know, not as many people have extended families as they, as you know, generations ago. So people may live in an area that they have no, close family. And so I say if something if you know if you are in an accident today on AI for who knows you have a pet, and who can get in the house and get the pet and make sure it has food and water and do something with the pet. i It’s the same conversation I have about children who can go pick the kids up at school while your family members from Virginia are driving down here. So yeah, we need to figure out what to do with the pets on the short term, emergency side. And then in the bigger picture. So I talk about it a lot. I have a fairly raunchy story about a parrot. Parrots live about 150 years. And I had a client who had a parrot that he’d had for 60 some years. And he came in to do a state planning with his parent on his shoulder and the parent cursed at me. I won’t tell you what the parent said, but the first of me through the entire session, personally, and then it would look around his shoulder and look at me go, Hey, baby, get out of here with my parents, but the parent was gonna live another 70 years or more, and he wanted to do something for the parent. Yeah, that’s a big thing.
Jude Wilson 08:26
Absolutely. Absolutely. Most of our clients have pets. I’m not a pet person, as I told you before. In fact, one day when I was in your office, the Great Dane made an appearance. And I don’t think that’s a dog. That’s got to be a pony. That thing is so big.
Merrell Bailey 08:43
He’s a barn animal.
Jude Wilson 08:46
So let’s move on to some other topics that may affect everyday people like you.
Merrell Bailey 08:50
So what I’d like to talk about personal Judo is what can you do with the pet? So first, I want to make sure that someone can get in the house if there’s a crisis. Absolutely. And then there’s the long term what to do with a pet and so you know, you can leave the pet you can just say forget it. The pet under law is considered furniture. It’s considered chattel. It’s it’s not they don’t worry, there’s not any special words for a pet. So you can just say forget it. The pet just goes with everything else and someone takes the pet, you can say who specifically gets the pet, you can say I’m leaving my pets, plus $5,000 or $500 or 500 that you know, whatever number you want to a person to take care of the pets. We can do any of those things. The highest end thing is we can do something called a pet trust. And Leona Helmsley is the most famous one for that she left her all of her money in trust. I think your dog’s name was precious. I can’t remember anymore. Yeah, but the dog ended up living in the house with all this money and caregivers. And the big issue at the time was from the state planning attorneys. What if They cloned the pet, how would they know when the pet dies. So because they could live for the rest, you know, their human lives with a dog that genetically is still the same dog but isn’t the same dog and that was a little interesting at the time. But most people just want to make sure that their pet is cared for. If you have a pet that is outside the norm, like a 180 pound Great Dane or a parent, not everybody is willing or able to take a dog that’s the size of a barn animal. Yeah. So what I what we have in Raph and I have is we are leaving Abe Lincoln back to the breeder with several $1,000. And they will either keep him or find him a wonderful home, we could have done the same thing with a pet rescue group, leave the pet and money because the pet rescue group will be happy to take the dog or cat or ferret or bird whatever, with some money to make sure that it’s taken care of and they will find a really great home for the pet. So there we have a lot of options.
Jude Wilson 11:03
Yeah. I’m glad you brought up the Leona Hemsley because I don’t remember exactly. But I think her pet inherited something like $12 million.
Merrell Bailey 11:14
And this was decades ago. So there was a huge amount of
Jude Wilson 11:18
right to live in the house. Yeah, yeah. So that’s not everyday people. But the the concept is the same. Let’s move on to another topic that that I think a lot of our listeners would be interested in addressing the digital legacy that some may, some people may leave behind. And let me kind of define that before you talk. To that point, Merrell. We live in a social media world, just about everybody I know from clients that are 85 years old, to my nieces and nephews have some sort of digital present presence. And a good friend of mine passed away seven years ago. And now I’m still getting updates every year on Facebook about his birthday. So obviously, no one had the passwords to be able to take that account out to close that account. So what do you do with your clients? Do you bring that up as a topic,
Merrell Bailey 12:18
I am a freak about the passwords and the logins to the point where we designed our own little password book to give out to clients that looks like an address book. And you know, you can write in it. And the sticker here comes off so that it doesn’t say password book. So nosy neighbors or thieves, I guess, don’t see it’s a password book. And I tell people just keep it with the computer and updated all the time. passwords and logins have become such a big thing. And it’s not just with the digital media, it’s with someone’s in the hospital, how do I access their bank account? How do I make sure the bills are being paid? Because used to be when someone was sick? You know, my I would have a client clients daughter call and say my mom fell and she’s in broke her hip, and she’s gonna be in hospital for three months, what do I do? And I’d say, oh, go in the house and pick up all the mail and find all the stuff and find her checkbook. And we’ll figure it all out. Well, people don’t have checkbooks anymore, and they don’t get the bills in the mail anymore. And we it’s very difficult to follow this paper trail that the CPA in me was like, Oh, we can always track it back with paper. No, sometimes you can’t. And people have their whole lives on their phone. And they’re like, Oh, well, I’ve got a list of passwords saved in my phone. Well, that’s great, but we can’t get in the phone. Because the phone has a password. And they just don’t think of that. So. So the first thing starts with make sure you’ve got a solid list of logins and passwords. The first time I spoke about this was years and years ago. And I thought well, before I do the speech, I’m gonna practice what I preach. So I took a piece of paper and I put it on the on my desk. And every time I logged in that day, I wrote down what I logged in. And before 7am Ralph and I were going to go away that weekend and I had to cancel the newspapers. We have three newspapers and the mail and I was like, oh my god, it’s seven o’clock. And I just want them to, you know, five things that no one would think to deal with. Yeah, easily. So the first thing is make sure that somebody that you have a good list that someone knows how to get into it. I’m a fan of old school on paper. A lot of people are more digital and they want to use last pass or you know, there’s a lot of digital options but control freak in me is thinking who has access to that and I don’t like it but that’s an option. It’s better than nothing. The second thing is who is going to control your legacy. Your social media legacy, you know, people want access to the photos. They want to know who you were texting. We had a case. Not not so recently where a teenager died in suspicious circumstances. And his his the teenager had was living with his dad. And when he left from living with his mom to move in with his dad, he changed his phone password. And dad wasn’t as social media savvy as the mom and didn’t know what the password was. And they couldn’t get in the kids phone. And so they thought, Well, maybe if we knew he could, who we hung out with, we could find out what happened in those hours before his body was found. And it’s still going on. It was tragic. So you, it’s not just you, it’s your kids need to you need to know where they’re logging in. And they need to know how you’re logging in. And everyone thinks you can figure it out, but you can’t. So first have a list. Second, there are some federal laws that deal with who is allowed to log in, as you mean, access your accounts. And then there’s another federal law that talks about who is allowed to get your login information. So those laws came from a couple decades ago now. But they had to deal with medical, basically medical records, you would go to the doctor, and you would be treated for something. And the next thing you know, you’d get in the mail. You know, if you went and had a pregnancy test, and all of a sudden, you’re getting things from Target saying sign up for our baby list, and you’re like, Oh, my God, I didn’t tell anybody but the doctor’s office had sold the information. So this is decades ago, they can’t do it anyway. So first, they had, you know, who could you share the information with? And who can access it. So there are federal laws that deal with it. estate plans are under state law, state law is subordinate to federal law. But we do include in our documents in all of our documents, the right to access digital assets, because you’re like, why would this be in the health care surrogate? Well, I’m pretty sure your doctor is keeping records for you online. I know Walgreens has all of my immunizations in there, right. I know all my prescriptions, it’s so much easier for me to log into Walgreens and figure out what I’ve got than for somebody to try to track it down. So people have to have access that you don’t even think of for things. So it’s really important to give them the authority that they that they have. And then the third big thing is who what do you do you want it all taken down? Do you want to cut their you know, maybe your friend wanted people to be reminded of him after he’s gone? And so said, you know, leave it up there. So that dude remembers me on my birthday. Right? That’s an option. Well, mostly it’s it’s more they think about it, and they haven’t shut it down or nobody has access to it. And because they there’s a federal law that says that fed Facebook just can’t handover your credentials to someone else. without a court order. They just haven’t taken care of it. So it’s, it’s really it’s a big issue. It’s a big issue. cryptocurrency and blockchain assets, which are also digital are terrifying to me. Because if you don’t have that login and password, that access to that account is gone. And you cannot get it back. Yeah, it’s a big issue, and it’s becoming even more.
Marc Killian 18:09
All right, as we wrap up part one here of the estate planning conversation with Merrell Bailey and Jude Wilson. We remind folks to subscribe to the podcast so that you get updates on when new episodes drop, like Part Two, you can find all the information on whatever platform you like using if you’re already on Apple podcast or Spotify, something of that nature. Just type in plan wise, retire free in the search box with Jude Wilson, and you can find it that way. Of course, you can also find it on a couple of websites, Jude’s main website, if you’d like to schedule some time as well as it’s interest fs.com That’s interest fs.com Or you can stop by plan wise retire free podcast.com as well. So we’re gonna wrap it up this week. We’ll be back with part two on the next episode and we’ll get into some conversation for a singles or individuals as it relates to estate planning some things to think about there. Thanks for listening to plan wise retire free with you Wilson.
The preceding program is sponsored by Jude Wilson, who is solely responsible for its content. Financial Planning and advisory services are offered through prosperity Capital Advisors, PCA an SEC registered investment advisor, with its principal place of business in the state of Ohio centers, financial strategies and PCA are separate non affiliated entities. PCA does not provide tax or legal advice, insurance and tax services offered through centrist financial strategies are not affiliated with PCA. information received from this podcast should not be viewed as individual investment advice. Product discussions and illustrations are hypothetical in nature and will vary based on many factors including but not limited to age, health, product, insurance, carrier and product design, you should consult the insurance carrier website and policy for detailed information. For information pertaining to the registration status of PCA, please contact the firm or refer to the Investment Advisor public disclosure website WWW dot advisor info.sec.gov For additional information about PCA including fees and services sent for our disclosure statement as set forth on Form ADV from PCA using the contact information here in please read the disclosure statement carefully before you invest or send money