Cornelius Vanderbilt Created an Estate Plan, but Should I?

AJC’s recent article entitled “Why Vanderbilts should inspire you to create an estate plan” explains that when Cornelius Vanderbilt died, his son, William, inherited most of the fortune and nearly doubled it within a decade. However, after that came a drop in the cash, and after just a few decades, the fortune had been spent. Therefore, none of Vanderbilt’s descendants stayed among the wealthiest people in the country.

When 120 Vanderbilt family members recently gathered for a reunion at Vanderbilt University, not one was a millionaire. In a century, the largest estate America has ever known had dwindled to next to nothing.

Let’s look at why this happens and how you can prevent this from happening to your estate.

America is currently in the midst of the greatest transfer of wealth ever. An estimated $59 trillion will be transferred to heirs, charities and taxes between 2007 and 2061. However, roughly 70% of wealth transfers aren’t successful. This means that sometimes heirs get practically nothing. There are three reasons for this failure:

  1. No trust and communication among heirs because they’re all concerned about their share.
  2. Heirs are unprepared to inherit an estate, which may include managing investments or a business. In many cases, other family members don’t know how it works.
  3. Heirs have no clue where the money should go and what purpose it should serve because no one is thinking long term about what is best for the family assets.

It’s common for business owners to believe that an estate plan is enough to keep everything in order, but they don’t consider their business. This is the reason why succession planning is vital. This planning determines what happens to the business itself and lays out the strategy, so it continues to operate smoothly after it’s passed to the heirs.

Let’s look at some tips for dealing with estate planning that should make for a smooth transition:

Create a plan. If you die without a will, state probate law will determine who gets your assets. This may not be what you want. Talk to an experienced estate planning attorney to be certain that everything is drawn up correctly.

Discuss the issues with your heirs. Talk to your family about the financial details. Make sure that your heirs know the details of your estate, so they can start to manage and oversee it once you die.

Get heirs involved in the process. Likewise, heirs can help plan based on their knowledge, future availability and expectations. By planning now, no one will be caught unaware about what to do with the estate.

Ready your heirs. Educate your heirs on how to manage and oversee your assets, especially if you have a succession plan for a business. Discuss the company’s mission and vision, and what you want the company to achieve.

Organize your financial documents. Get all financial documents in a single location and label everything clearly to help out your heirs. Keep this in a safe location, and let your heirs know where it’s located. Your attorney should also have a copy of your will, estate plan and succession plan (if applicable).

Get help from experts. Help forge a relationship between your heirs and your financial team, which may include a financial adviser, an estate planning attorney and an accountant. This will allow your heirs to know who to call, if things get complicated. It’ll also help to prepare them for what they’re supposed to be doing, once they get their inheritance.

Communication is the key. Talking with your experts and your heirs will make certain that everyone understands each other’s roles, regardless of whether it’s a small business or a multimillion-dollar empire.

My office is fully open to handle your estate planning matters. Please contact me to schedule a consultation, which can be done in person or virtually through Zoom.

Reference: AJC (Sep. 25, 2020) “Why Vanderbilts should inspire you to create an estate plan”

 

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Little Things Can Add Years to Your Life

Get moving, says a 20-year study conducted with nearly 15,000 residents of the United Kingdom age 40 to 79.

The research was conducted by the MRC Epidemiology Unit at the University of Cambridge, and the results were published in The British Medical Journal.

Considerable’s recent article entitled “This small lifestyle change can add years to your life” explains that the subjects who kept or increased to a medium level of activity were 28% less likely to die than those who stayed at a low level of activity.

The researchers split the sample into three groups who engaged in low, medium, and high levels of activity. They monitored changes to their activity for about eight years. Then they looked at the health effects over the next 12½ years.

The researchers found that those who stayed or increased their level of activity from low to medium were 28% less likely to die during that second phase than those who kept a low level of activity.

Moreover, those subjects who’d been moderately active but raised their activity level achieved a significant 42% increase in survival, compared to the low-activity subjects.

This impact was present even for those respondents who ate an unhealthy diet or had experienced a health condition, like high blood pressure, high cholesterol, or obesity.

So, the big question is just how much activity is required?

The study defined the activity levels according to the following guidelines:

  • Low: Less than the guideline of 150 minutes per week of moderate intensity activity
  • Medium: achieving the guideline of 150 minutes of moderate-intensity activity per week; and
  • High: The guideline of 300 minutes of moderate-intensity weekly activity.

The high level also allowed for an equivalent, like 75 weekly minutes of high-intensity activity, or 60 minutes of high-intensity activity and 30 minutes of medium-intensity activity per week.

The researchers think that their study will motivate more people to take it up a notch, regardless of their age.

“These results are encouraging, not least for middle aged and older adults with existing cardiovascular disease and cancer, who can still gain substantial longevity benefits by becoming more active, lending further support to the broad public health benefits of physical activity,” the authors commented.

Reference: Considerable (Sep. 22, 2020) “This small lifestyle change can add years to your life”

 

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Will COVID-19 Cause Memory Loss?

It’s now apparent that many people suffering from COVID-19 exhibit neurological symptoms. These symptoms include a loss of smell, delirium and an increased risk of stroke. There are also longer-lasting consequences for the brain, including myalgic encephalomyelitis/chronic fatigue syndrome and Guillain-Barre syndrome, reports Considerable’s article entitled “Does COVID-19 increase your risk of memory loss? Here’s what we know.”

The article say that these effects may be caused by direct viral infection of brain tissue. However, there is growing evidence to suggest that additional indirect actions triggered via the virus’s infection of epithelial cells and the cardiovascular system, or through the immune system and inflammation, contribute to lasting neurological changes after contraction of COVID-19. Scientists are looking at whether there be a COVID-19-related wave of memory deficits, cognitive decline and dementia cases in the future.

Scientists say that many of the symptoms we link to an infection are, in fact, due to the protective responses of the immune system. This is also true when it comes to feeling sick: the general malaise, tiredness, fever and social withdrawal are caused by activation of specialized immune cells in the brain, called neuroimmune cells, and signals in the brain.

In addition to changing behavior and regulating physiological responses during illness, the specialized immune system in the brain also has several other roles.

Research now shows that the neuroimmune cells that are at the connections between brain cells (synapses), which provide energy and minute quantities of inflammatory signals, are essential for normal memory formation. Unfortunately, this also is a way in which an illness like COVID-19 can cause both acute neurological symptoms and long-lasting issues in the brain.

During illness and inflammation, the specialized immune cells in the brain become activated, sending out large amounts of inflammatory signals and changing how they communicate with neurons. Because COVID-19 involves a massive release of inflammatory signals, there are both short-term effects on cognition (delirium) and the potential for long-lasting changes in memory, attention and cognition.

There is also an increased risk for cognitive decline and dementia, including Alzheimer’s disease, during aging.

The potential connection between COVID-19 and persistent effects on memory are evidenced by observations of other illnesses, such as patients who recover from a heart attack or bypass surgery who report lasting cognitive deficits that become exaggerated during aging.

It will be many years before we know whether the COVID-19 infection causes an increased risk for cognitive decline or Alzheimer’s disease. However, this risk may be reduced by prevention and treatment of COVID-19. Prevention and treatment both rely on the ability to decrease the severity and duration of illness and inflammation. Interestingly, new research suggests that common vaccines, including the flu shot and pneumonia vaccines, may reduce the risk for Alzheimer’s. Several emerging treatments for COVID-19 are drugs also suppress excessive immune activation and inflammatory state. These treatments may also reduce the impact of inflammation on the brain and decrease the impact on long-term brain health.

Reference: Considerable (Aug. 7, 2020) “Does COVID-19 increase your risk of memory loss? Here’s what we know”

 

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