Wealth Actually

In this episode of "Wealth Actually", I speak with George Hubbard. George is the Managing Partner and Chief Investment Officer of Algonquin Advisors, a Registered Investment Adviser that focusses on large families, foundations, endowments and other pools of money. He and his firm bring a unique approach to family investment management that uses tried and true institutional principles.

Pay special attention to our discussion around alternative assets and the role of the asset class for family investments. George also talks about bringing "trustee" principles to investment implementation.

And in honor of the U.S. Open at Winged Foot, we talk about what his dream foursome would be and where it would be played.

Introduction

Algonquin Advisors

T21 Trustees

What are the differences between institutional investment thinking and HNW thinking?

Taxation Issues

Time horizons

Liquidity needs (Yale model)

Return expectations

Access/Deal Flow

Position sizing

"Real" Due Diligence (how much time/resources should one expect to expend in researching a manager/deal?)

The power of concentration to build wealth

Where alternatives fit in asset allocation

Function of

Alternatives

Diversification

Other types of risk the traditional investor is missing?

The ultimate importance of having the private equity portion of a portfolio fund future vintages out of current private equity distributions. (While this is obvious in the institutional world, this kind of thinking is largely absent from most advice to investors who are "sold" private equity!).

What can be borrowed

from institutional processes to help Individuals make fewer rookie

mistakes?

Starting at the Beginning: The Investment Policy Statement and The Asset Allocation

The Importance of a "Forensic Review"

What comprises a "Forensic Review"?

The Importance of "Intentional" Investment Decisions

How should a trustee think about these things in a true "fiduciary" capacity?

Importance of cash management, lock-ups, multiple time horizons, multiple beneficiaries, multiple interests

What are the Alternative Asset Classes that investors are focussing on now?

-Private Equity (LBO,

Venture)

-Private Credit

-Hedge Funds /

derivatives

-Managed Futures 

-Commodities

-Real Estate

-Infrastructure

-Collectibles

-Insurance

T21 and the Importance of Getting the Right People into Fiduciary Roles for Families

George's Golf Dream Foursome

How do we keep track of George and the firms?

ALGONQUIN ADVISORS

T21 TRUSTEES

https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT/

Part of the fun of the Wealth Actually podcast is to delve into topics around wealth management and better ways to help families understand the intersection between wealth and the fulfillment of goals and ideals. I also get to speak to people as they describe their entrepreneurial journeys- which in itself provides many lessons on the path to success. Occasionally, you get both in one conversation. Enter Betsy Brown.

In this episode, we talk about:

Betsy's background at larger institutions and the entrepreneur "bug"

The changing Wealth Management Industry

The desperate need for independence and customization for clients

The appeal of Tennessee as a legal jurisdiction, a growing business haven, and a nexus for diversified businesses

How this led her to the formation of Pendleton Square Trust Company.

The development of her support system and the importance of having a community of entrepreneurs to lean on and share ideas (and opportunities!).

The importance of story-telling in communicating, not just to the families she speaks with, but the market at large

The influencers in her life that provide her "north star".

This is a particularly fun I get to see this up close as I work with Pendleton Square Trust Company to bring the message of benefits of Tennessee law to the advisors for family offices, foundations and fiduciaries in the Northeast and beyond.

More information about the firm and Betsy can be found on the links below:

LINKEDIN: BETSY BROWN

Transcript

Tell us about the origin of the firm and what makes it special:

We chartered Pendleton Square Trust Company in October of 2015- so we are about to celebrate our 5 year anniversary! Happy Birthday, Pendleton Square! We are a chartered trust company regulated by the TN Department of Financial Institutions. The opportunity came about from listening to families frustrated with the traditional corporate trustee options.  We also studied and implemented accounting and administration technology platforms to build our dream independent trust company. I always use the term “we” because it took a team. My partner Derek Church is a genius- he is an attorney and oversees regulatory, compliance and operation side of the business- our board and investors believed in us and supported our plans to build a best in class independent trust company. Our trust officers and team members are serving our families and building efficient processes.

I want to stress that we are an independent trust company- our definition of independent is that we are not affiliated with other banks or financial institutions- we focus on trust administration and we do not manage the liquid assets. As a fiduciary we are held by law to the highest standard of responsibility. Our model is designed to avoid conflicts of interest and provide a natural system of checks and balances, we are not managing assets or drafting estate planning documents. In addition- our fee structure is simple and transparent.

I also want to share how the concept of INTERdependence is extremely important for our model. We are interdependent on the network of advisors surrounding the family- the financial advisors, estate planning attorneys, family CPAs, insurance specialists. There is constant communication and collaboration with our partners as we serve the family. In many cases, the financial advisor is the quarterback of the relationship- we are there to assist and provide the backbone of trust and estate services.

How did you get into the trust business?

I cannot believe that I am approaching 25 years in the financial services industry.  I grew up in the traditional big bank environment- and I am so thankful for my strong credit and analysis background. I spent 10 years in Debt Capital Markets- a true transaction business- but my mentor always told me I should be in the long-term relationship business. I transitioned to private wealth and trust business for the next 10. Reflecting back on the past 20 or so years- I like to think I have identified my spiritual gifts while serving as trustee or executor and helping families through life events: they are discernment, service, and administration. The team that we are building is focused on deepening relationships, establishing partnerships and helping others.

Why Tennessee?  (Law, geography and business climate)

I hail from the great state of TN- home of Dolly Parton, Grand Ole Opry, Graceland, Jack Daniels, Big Orange Country, the Great Smoky Mountains, and Pendleton Square.

Frazer, when we met when you were in law school in our early 20’s- I grew up in TN- but it was in my rearview mirror. After living in Virginia and Atlanta, and brief stints in DC, New York and London- we moved home to raise our family. My eyes were opened to the very progressive and productive public/private partnerships in Tennessee. The Tennessee Bankers Association has been instrumental in leading or supporting many of the trust initiatives. Our legislature, regulatory body and Commissioner Gonzales are pro-business, pro-family and extremely collaborative. In the US News ranking of state fiscal stability- Tn is ranked #1 in long term fiscal health and we have a AAA credit rating. 

As a matter of fact, Tennessee gets its name from the Yuchi Indian word that means “meeting place.” I like to think that in our connected world, Tennessee will become a meeting place for families- and we will of course share Southern hospitality- good music, food and spirits- along the way.

Over the past 2 decades, Tennessee has created a very attractive trust and tax environment. It is a 2-part strategy: provide additional flexibility for TN residents, and attract out of state families to maintain trusts in Tennessee.

Timeline:

The Uniform Trust Code 2004Extension of rule against perpetuities (360 years) 2007Asset Protection Trusts 2007Community Property Trusts 2010Trust protectors 2013Tenancy by entirety trusts 2014Special purpose entities as protectors/advisors 2019

Additionally, there is no state income tax for out of state beneficiaries- and Tennessee will join other states with no income tax Jan. 1st, 2021.

Why is now an important time for estate planning ?

The pandemic has of course reminded us to understand the importance of having our affairs in order, but on top of that . . .

Low interest rate environmentVolatile market/ low valuationsCurrent federal gift and estate exemptions are high, but scheduled to be cut in half when the law sunsets in 2026 or even sooner.

Delaware Case Study

One example I would share is a family in New York that funded a family trust in November 2012- sound familiar?

They chose Delaware as the jurisdiction- unhappy with the responsiveness and service of the administrative trustee- and it was a complex web of investments that needed consolidation and oversight reporting. Their investment advisor linked the family with us. We reviewed the governing document and accomplished the transition to Pendleton Square and Tennessee through a simple Non judicial settlement agreement and a Notice of Change of Situs.

I encourage families to examine several components when looking for new trustees:

Service- how am I current being served, how may that be improved? Does an individual have the resources to fulfill all of the duties as trustee? Is my family lost on the big bank restructurings?

Situs- will changing situs improve flexibility, protection, fee structure? are there tax advantages?

Succession- when my family goes through a transition, what type of team, or entity will I want to be there to help my family?

What are some of the strategies that you are seeing clients use?

Direct gift to an irrevocable trust to benefit a childSpousal limited access trust (SLAT)Installment sales to an irrevocable grantor trusts

I would first analyze the cash flow impact of any gifting strategy. Of course it is very difficult to generalize. We encourage families to connect with their estate planning attorneys to discuss gifting strategies.

Tell us a little bit about how you started and built the business and your influencers?

I grew up as a child of a female entrepreneur. My Mother started a small business when I was 5 and grew it for 30 years. I worked there weekends and holidays. It was in this retail environment where I first learned about serving clients, employees and the community. Her motto was the customer is always right.

My Father was an early adopter of the power of positivity. He woke me up every morning with quotes from Winston Churchill- Never give in- except to convictions of honor and good sense” or Zig Ziglar- “see you at the top.” To him attitude was everything. He was also very involved in the community and helped in the early stages of the Chattanooga Renaissance. I like to think I am following in his footsteps as a community contributor.

Faith and family really are my inspirations- we have a very large extended family- there are 16 in my children’s cousins generation- so family means a lot to us. I like to say both professionally and personally- families matter.

My husband Hugh is helping the team build the business- I could not manage family and work life without him. Our main mission is to set an example of service, hard work and faith for their three young children.

Tell us about the JumpFund and your community of entrepreneurs

One of my mantras is surround yourself with passionate and interesting people-

In 2013 I joined a group of dynamic, passionate friends- true problem solvers with diverse backgrounds. We recognized that there was lack of capital available in the South for female entrepreneurs- less than 3% of venture capital in the Southeast was being allocated to female led growth ventures.

Instead of starting another nonprofit, we know capital is king. We founded The JumpFund- an angel investment fund- and raised mon

As summer is starting to wane (before it ever really got going!), I took the time to try to look around the corners of wealth management for clients with BILL SWEET. We discussed today's estate planning environment and the many challenges and opportunities that currently exist and why it's important to get going on that process now.

Bill is the CFO of RITHOLTZ WEALTH MANAGEMENT. Founded by Josh Brown and Barry Ritholtz, RWM has burst onto the wealth scene with a media savvy and marketing push that is different than most in the wealth management space. Bill manages the finances of RWM and is the resident expert on taxes for the firm's clients. Bill was also a Captain in the U.S. Army where he presided over $12mm pieces of rolling thunder as a Tank Commander!

Military Experience

Bill's Experience as a Tank CommanderThe benefits of hiring Veterans and people with military experience:DisciplineExperience with StructureResponsibilityHonor / PrinciplesPhD in Getting Things DoneReady pool of experienced employees

Links to Veterans Groups at the bottom for those with further interest. Our veterans are an amazing resource of talent in this country.

The Estate Planning Environment

Bill and I went into a wide-ranging discussion of the benefits of getting one's estate planning done now and what might change in the near future.

Interest Rates are at generational lows which provides extra leverage and flexibility in moving assets out of an estate.This applies to many estate planning and intrafamily loan techniques that have incredible estate and wealth planning powerThe current AFR rates are here: AFR RATES and IRSValuations for assets are low due to the recent market volatility, which means a well-thought out plan can get more intrinsic value out of an estate.Federal Estate Tax Exemptions are at all-time highs: $11.58 million per individual, or $23.16 million per coupleFederal and State finances are going to require more revenue implying an INCREASE IN TAXES. (and probably at all levels)The elections in November could have a massive impact on the generosity and flexibility of the current estate tax climate at the Federal AND State level.States hard hit by the COVID-19 epidemic may face particular economic and social concerns that require extra funding. (New York is a good example)There will be increased State scrutiny for those using low tax jurisdictions for INCOME AND CAPITAL GAINS TAX PLANNING.Very brief discussion of domicile and residence and the art and science of personal state tax planningIt is more than just 180+ days and changing your car registration.Here is a recent Supreme Court Case on the potential for double taxation at the state level: Edelmans’ New York Connecticut Residency Tax CaseThere is going to be a mad rush for a lot of families to accomplish their estate planning before the end of the year (and thus a mad rush around the advisors to implement this planning)Beware of the 9/15 and 10/15 tax deadlines . . . accountants are just now catching their breath from PPP planning and the extended 7/15 deadlineLawyers and financial institutions have not seen a potential crush like this since 2012. We anticipate EXTREME stress on entity formation, trust drafting and reviews, KYC processes and account opening. Waiting until November could be a big mistake.NYS Estate Tax CliffIf you have a net worth of $5mm or higher in NYS, you need to revisit your plans to ensure that your STATE estate tax liability is as low as it can be and if there are any steps you can take to reduce it. My quick primer is HERE.Having health directives etc . . . in place because of COVID illnessesI covered this in detail here: HEALTH DIRECTIVESGetting deposits in on nursing homes to make sure you have a spot locked in etc . . . Final thoughts on getting started even if you aren't in the "1%"

Veteran's Groups

For veteran's employment programs especially in finance, Bill suggested that I highlight the work of Won Palisoul and Chris Mendez on the CFA SOCIETY'S VETERANS ROUNDTABLE. Their goal is to create a network to facilitate veterans transitioning to a career in finance: https://twitter.com/billsweet/status/1192247303022825473For charitable organizations, Bill advocates for the FISHER HOUSE FOUNDATION - they provide zero-cost lodging for families who want to be near their service members while undergoing medical procedures and rehab. The DOD only provides room/board to the veteran / soldier themselves: https://twitter.com/billsweet/status/1162112234102972416

https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT

In the age of COVID-19, there has been a renewed focus on Health Care Directives. The communicability and finality of the disease have opened up all sorts of fears and uncertainty for many people- especially among the elderly. To that end, I am excited to present the conversation I had with TIFFANY MCKENZIE. She is a partner in the Private Client Group at Bryan Cave in Atlanta. We talked about planning in the COVID-19 environment with extra attention on the often-overlooked health care directives.

Description of the Current COVID Environment for Planning

The speed and communicability of the diseaseThe higher death rates Many times people enter hospital unaccompanied

A Quick Reminder for Listeners: What are the Usual Documents that Need Updating:

WillTrustsPowers of AttorneyAnd Health Care Directives

Health Care Directives

How are this different from a Power of Attorney?Designating Health Care PreferencesDesignating a Health Care Proxy

Preferences-

What criteria for decision-making should we include?What are 

Proxy

Who should be in this Role?When does this person make decisions?What should be considered in a COVID environment?

Communication issues

Being comfortable with remote methodsDeveloping a relationship with doctors and institutions and their decision-makingPreferences for choosing drugs, services

Intubations - 

What is the process for ventilators?Triage v. Best Efforts

What else are should be thinking about in emergency situations?

Where can we reach you and keep track of your writings?

TIFFANY MCKENZIE BIO

TIFFANY ON "HEALTH DIRECTIVES"

CHAMBERS COMMENTS

Judy Pearson is the Founder and CEO of Nomadx.

Nomadx helps fiduciaries, officers, directors, trust companies and law firms identify the risks in their practices and insure them against liability. She has over 37 years of experience with Chubb, AIG and was a pioneer in the development of directors and officers liability coverage for AON.   We're going to be focussing on the liability issues facing fiduciaries, including individuals, law firms, corporate trustees and private trust companies.

Trustee Roles and Responsibilities

 

The words Trust and Trustee- are big "all encompassing" words that mean different things to different people. Let's try to break it down a bit:

 

A trust in general has three main roles:

Grantor (Person forming the trust)

Trustee (Person or entity in charge of running the trust)

Beneficiaries (Those people who will benefit from the trust)

Insurance Perspective

From an insurance perspective, what do you see as the responsibility of the trustees?

 

What are the duties (i.e. who is the client reporting to?) and risks?

Duty of Loyalty (to the trust)

Duty of Care (to the trust and the different beneficiaries)

Safeguarding the Assets

Reporting on the Assets

Prudently Investing the Assets

Distributing the Assets

When dealing with the risks, what do modern trustees do to protect themselves from liability?

Good policies, procedures, record keeping around decision making and action (operating with the risks)

Setting up good structures to shield liability and get adequate support from experienced trustee providers to help with the job (transferring the risk)

Identifying reasonable risks and getting reasonable insurance (insuring against the risk)

How does trustee liability insurance look?

Are there parallels to E&O and D&O insurance)?

And what are the common misconceptions of the trustee insurance market?

You don't need insurance

Your umbrella policy covers you

Your traditional E&O, D&O policies will cover you

Trust Protector / Power of Attorney might not be in traditional insurance

Belief of Indemnification - Is there an agreement?

Can we indemnify beyond the law?  Gross Negligence?

Good Insurance advances defense costs to get out of Gross Negligence

Reasonable risks:  What are modern trustees worried about?

TOLI’s and Life Insurance

Distribution questions

Interfamily loans

Investing and reporting

Reg BI

Conflict between SEC and state standards

5 states of adopted their own rules and 12 additional states expected to adopt their own rules is 2020

Investment performance will be reviewed in 2020 hindsight

Reporting to beneficiaries (look at SEC guidance)

Cases to watch

Divorce case testing South Dakota Privacy Laws and Asset Protection

Breach of Fiduciary Duty

Prudent investing internal funds vs. external funds

Conflict of interest, mutual fund selection

Direction Structures

Deep understanding of roles and responsibilities

Execution vs. structure of document

Beneficiaries - making sure they are educated

Future Trends

Hybrid solutions with corporate trusteesSpecial Purpose Entities Insurance pooling?

Conclusion

We've presented a lot of scary scenarios!

For current trustees and future trustees what is a good first step they should take in analyzing their situation?

How do we keep track of you and Nomadx?

WEBSITE: NOMADX

LINKEDIN: JUDITH PEARSON

https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT

In this episode of "Wealth, Actually", we get to dive into the comic-book industry with Gevian Dargan. Gevian is about to launch his comic imprint, Animated Concepts, which is focusing on getting some of the great comic stories from people of color that are out there, but not getting the attention they deserve. The industry itself is going through significant upheaval as the economics of developing IP come under considerable question and distribution systems face significant challenges with digital competitors and a new view of what makes a cool (and monetizable) story.

Gevian and I tackle this subject as well as the magic of growing up with the excitement of going to your "local", discovering characters and forming tastes. It's this formative development that we wonder aloud that might be missing and may make it difficult to develop the next Marvel, DC, Harry Potter or other franchise.

Here's Gevian on the "Thinking Critical" podcast talking about reaching new black comic readers. (This is a terrific interview BTW)

https://www.youtube.com/watch?v=rGQw9Z7qOO0

Here's the outline of our fun conversation (we recorded for over an hour, spoke for two and probably could have gone on all day):

Quick introduction- what are you're doing now and dramatic foreshadowing of your Animated Concepts project-Where did the love of comics come from? Talk about the relationship with the Comic Book ShopWhere you used to buy comics and where you buy them now? Challengers Comics + Conversations: www.challengerscomics.com; First Aid Comics: www.firstaidcomics.com; Dark Tower Comics & Collectibles: www.darktowercomics.com;Alternate Reality Comics: www.myalternatereality.comFavorite Characters / and what drew you to them?RobinShazamFavorite Issues/ StoriesFavorite Artists  Who are the artists and writers we should really be looking out for?History, Craft, and Business of Comics (Diamond, New Readers, Promotion, Writing, Drawing, etc.)-How the COMIC BOOK industry has become so tribal politically, whereas before it used to be Marvel vs. DC vs. Indies (just weird now)MCU vs. DCEU What does the future of the comic industry look like?Animated Concepts - Tell us the concept behind it and what are your plans for it?How do we keep in touch with you? [email protected] (Focus Groups are forming in July- reach out to Gevian for more information)FACEBOOK: GEVIAN DARGANTWITTER: @GEVIANDARGAN

A quick aside: many of you know of my love of comic books and the myth-making engine of that industry. My pal, Jim Harberson, and I (written under a pseudonym) dipped our toe in the water of the industry with our book, Stay Alive. We wrote our first (the horror/comedy, Stay Alive) and published it through the UK-based, Markosia Enterprises. It was a great experience to work with the multitalented and super-nice Stephen Baskerville. His art is amazing. The industry itself is tough. It's opaque and the chances of publishing, let alone success, are slight. Here's our first foray . . .

https://www.amazon.com/Stay-Alive-Jim-Harberson/dp/1913359166/

and here are some of Gevian's favorite covers:

As businesses and business owners struggle the impact of COVID-19 on operations going forward, I thought it would be useful to revisit the issue of asset protection for wealthy families. Liability is around every corner and the best laid plans can be wrecked with a car accident, an employee suit, or the discovery of asbestos in an investment property.

Joining me is IKE DEVJI to discuss some of the ways to address this issue. He is a prominent attorney in Scottsdale, Arizona who focusses on asset protection for executives, business owners, athletes, entertainers, and other high visibility people that can be the object of creditors. Ike has personally practiced from Phoenix and Scottsdale, Arizona for over 17  years as an Asset Protection-only lawyer and helps protect a national client base of thousands of clients representing nearly $6 Billion in personal assets.

He can be found at

PRO ASSET PROTECTION DAVIS MILES MCGUIRE & GARDENERTwitter: @IKE_DEVJILinkedin: IKE DEVJI

A) What is there to worry about?

Here are some real examples of the “impossible” that actually happened and resulted in large claims:

Parents away for the weekend return to find that a teenager died at their home during a party their child had from the drugs he brought with him;Chiropractor adjusts a patient’s hip and the woman dies on table from cardiac arrest-he is sued for wrongful death;Long time, most trusted employee of medical practice molests a minor female patient during treatment;Employees of moving company get drunk and severely beat another employee and lock him in company truck in company yard over weekend;LLC for real estate development is pierced and a passive member is held jointly and severally liable for the actions of the other members;Dentist works on elderly patient who goes home and dies of unrelated heart attack hours later, dentist sued for wrongful death.

B) What are Ike's three layers to good Asset Protection planning?

Clean LivingIdentifying the risks that are part of your daily life (and business)Being a good citizen and acting responsibly where at all possible Avoiding behavior that would cause harm and get you suedPutting in processes and procedures around riskier behaviorInsure against the risks you can reasonably identify (and afford)Put structures around and compartmentalize your wealth

C) What are the big tactical missteps people make that Ike sees?

1. FAILING TO ACT (Timing) 

(AKA - waiting for the tort to happen)The importance of the term: Fraudulent Conveyance

2. THINKING YOU’RE NOT RICH ENOUGH  

Many larger high net worth families can absorb a large hit to their net worth and not suffer a reduction in lifestyleFor those people with net worths in the 500K-5mm range, a $1mm settlement can have catastrophic consequences on lifestyle

3. RELYING ON YOUR TRADITIONAL ESTATE PLANNING

4. TOO MANY EGGS IN ONE BASKET

What happens if an accident happens on one investment property but you own 8 others?

5. SQUARE PEG ROUND HOLE – USING THE WRONG TOOL

6. DRAGGING LIABILITY INTO YOUR PLAN

Ike brings up a terrific example where having your business own your vehicles may be great tax planning in allowing you to deduct those expenses, but it can be terrible asset protection planning if they are used personally and cause a lawsuit. The assets of the business will have been exposed to the action.

7. RELYING ON GIFTING TO RELATIVES (SEE ALSO FAILING TO ACT)

8. USING UNPROVEN, POORLY STRUCTURED TOOLS OR SCAMS LIKE “FRIENDLY LIENS”

9. RELYING ON INSURANCE ALONE OR FAILING TO ADEQUATELY INSURE. WHY CAN’T WE SIMPLY INSURE OUR WAY TO SAFETY?

Premiums are expensive The "Business of Insurance" to collect premiums and try to pay out claims as little as possible)If you look hard enough you can find liability everywhere - there isn't enough any to insure away EVERY risk.Having a good P&C Insurance expert is important to makes sure that you have enough insurance to cover high probability (and high damage) events AND to make sure that you aren't overinsured for things you don't have to worry about.

D) The use of trusts in the asset protection world

1. Concept (erecting speed bumps for creditors); natural tension between protection and access

2. Using a jurisdiction with good law and good trustees

3. Reducing Nexus Issues and using good assets (real estate being a less desirable one)

[FRAZER'S NOTE: We don't get too much into the weeds on the trust topic (I'll use another podcast for that), but it is important to note that trusts can be a flexible tool in an asset protection plan. It is also important to make sure that tax planning, estate planning, and asset protection planning are integrated.

https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT

With the tensions brought on by the confinement, new roles and financial pressures of the Coronavirus, I thought it would be good to take a new look at one of the greatest threats to wealth . . . Divorce. High-end family law attorney, EVAN SCHEIN, and I got to sit down and talk about what is happening in the world of divorce. Evan is an expert in the field as Partner and Head of the Litigation Department of New York-based divorce firm, BERKMAN BOTTGER NEWMAN and SCHEIN. He has seen it all in the space.

Here is a quick outline of what we covered:

Are confined spaces and the quarantine causing an increase in the interest in divorces- what are you seeing in your practice?How has the lockdown impacted the process of divorce?What is the process looking like in the new Zoom Conference world?Is there anything new in the legal landscape of divorce?Planning before the wedding generally- what are best practices? What is the best way to be a good client?Asset titling is this still a useful tool?The use of trusts- has this expanded in this day an age?What is the best way to integrate other advisors? Wealth Advisors, Lawyers, Accountants, Business Advisors, Agents?Pre and/or post nuptial agreements- how should one think about pre-nuptial agreements? How do you have that uncomfortable discussion?If you are feeling like divorce is becoming an option in your relationship, what should you do?How do you advise people in communicating with the children in this difficult circumstance?Any crazy stories that you can share?Personalities in the divorce practice? 

EXTRA POINTS:

Finally, (since I'm running this!), Evan and I take a quick tour of our favorite sports teams and how they are dealing with the sports disruption.

https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT

https://mehlmancastagnetti.com/wp-content/uploads/After-COVID-Mehlman-Q2-2020.pdf

The political consulting firm, Mehlman Castagnetti, put together an interesting presentation on what a post-COVID world is going to look like. HAVEN and I synthesized some of the highlights and broke down what we saw as important. The link is above and it's useful to have in front of you as we deliver our comments.

Here is a quick outline of what is covered:

SECTION 1: WE WERE NOT PREPARED

"Recreational government" is neglecting what the true government functions are.

Our system is overly focussed on luxuries and there doesn't seem to be any political will until disaster is upon us.

SECTION II- M/C's PREDICTIONS

#1- New Psychology- what will the population's mindset look like going forward?

#2- "Deglobalization"- Will there be a retrenchment?

#3- Freedoms Trade-Off: Can you be worried about the virus, the economy and political freedoms at the same time?

#4- "Techlash" - will the suspicion of tech companies persist? It may pause but will return in earnest when our situation stabilizes-

#5- Asset Bubbles as search for yields and stability becomes paramount.

#6- COVID Inequalities Widen Social Divisions

#7- Initiatives will move away from the state

SECTION III: REASONS FOR HOPE

#1- Americans Stepping Up: Fauci, Front- Liners, Community

#2- Innovators Stepping Up

#3- Government Trying to Step Up- Even If Incompetently

OUR BIG ASK-

More Cooperation Between Public and Private Spheres as we look for solutions to the virus and revitalize the economy?

A reminder that you can subscribe to the podcast on most major platforms. More from Haven on his PUNDIFICATOR blog below. . .

https://pundificator.com/

And "Wealth, Actually" can be found here:

https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT

https://www.amazon.com/Stay-Alive-Jim-Harberson/dp/1913359166/

The COVID-19 phenomenon has created worldwide economic upheaval and problems for many business owners. One area where the coronavirus has created opportunity is in the field of estate planning.

I was able to speak with AARON FLINN about the opportunities that exist right now. We will go into some of the tools in his toolkit (including the use of preferred jurisdictions like Tennessee) to help successful, and often complicated, families take advantage of a difficult economic environment.

Aaron is a partner of WALLER, a full-service business law firm based out of Nashville, Tennessee with offices across the Southeast and Texas. He specializes in trust and estate work, wealth preservation, business succession and family office structuring.

Why is right now is an optimal time to review estate planning affairs and wealth structure?

1)  The shutdown has been a rare quiet time to think about the how families want to set up future affairs and have internal discussions about the investment, use, direction and purpose of the wealth.

2)  Lower valuations:

With markets generally lower across the board, the valuations of most family assets has decreased as well. This provides added flexibility when using estate planning tools and government defined exemptions to shift wealth out of an estate into the ownership of the next generation.

3)  Generationally low interest rates:

As the government has lowered interest rates to stimulate the economy, many of the standard interest rates used in estate planning have fallen as well. Government defined "Applicable Federal Rates" (AFR's) are the lowest they have ever been. The amplify the effectiveness of even the simplest of planning techniques.

As part of that planning, there are lots of instruments, jurisdictional choices and legal devices to effectuate a family's wishes. What makes Tennessee an interesting state for families to consider?

The Friendly Trust Environment of Tennessee

The theory behind Tennessee's trust law

The interaction of the Bar, Trust Industry, and the Regulators

Directed Trusts 

Specialized control of a trust's investments - why is that important?

Involving Trusted Advisors on Distribution Decisions - why is this important?

Why does the use of an Independent Trust Company for administrative purposes make sense?

Avoiding State Income Tax on Accumulated Income and Capital Gains

How does this work with clients from other states?

What should we think about with source income

Asset Protection

Beneficiary Creditors

Self Settled Trusts

Distribution Flexibility

Perpetual Trusts

Flexibility for Family wishes

Decanting

Trustee Removal

Silence

Specialized Protection for Independent Advisors

Special Purpose Entities (SPE) for investment direction advisors

Special Purpose Entities (SPE) for Distribution Advisors

Tennessee as an Excellent Environment for Private Trust Companies

What is a Private Trust Company?

In building these out what is the best way to ensure the multi-generational success of this flexible structure?

Jurisdictional and Regulatory "Understanding of the Space"

Well-suited legal and corporate fiduciary support located locally as required.

COMMENTS or QUESTIONS

Aaron can be contacted here: AARON FLINN

Additionally, I can be contacted here (FRAZER RICE) or here (FRAZER RICE) for further comments and questions.

https://www.amazon.com/Wealth-Actually-Intelligent-Decision-Making-1-ebook/dp/B07FPQJJQT