New York Times “Wealth Matters” columnist Paul Sullivan recently interviewed John O. McManus, founding principal of NJ-based McManus & Associates and a top AV-rated attorney, about the implications of a recent court case in which he successfully helped a client named Kate contest the will of her late grandmother. John grasped the dynamics at play in Kate’s situation with her family, which was crucial to a successful outcome with the case.
Estate Planning For High-Income Households
A local expert weighs in on the top 10 considerations
Motherhood Moment, an advice mecca for moms, recently shared with readers guidance from the latest McManus & Associates’ educational conference call (we love the idea that moms can benefit from our focus series, because our practice not only provides asset protection, but helps continue a legacy of family values through generations). In a Motherhood Moment post titled, “Thrifty Thinking: Estate Planning with Life Insurance,” it’s noted that the use of life insurance in one’s estate plan can provide significant protection for loved ones, whether as a wealth replacement strategy combined with philanthropic giving or as a safeguard to cover expenses and taxes.
The post highlights the most important considerations when planning with life insurance and lists the 10 questions below for which Motherhood Moment readers should find answers:
- If a life insurance policy is owned by a trust, what is the ongoing maintenance required for the strategy to succeed most effectively?
- What are Cristofani beneficiaries and how can they make a life insurance trust even more gift tax efficient?
- How can insurance be utilized to facilitate a business succession plan?
- Term, whole life, 2nd to die – from a layman’s standpoint, what are the unique benefits of each?
- How can ownership and beneficiary designations for a life insurance policy affect the taxable assets of the estate?
- How do non-citizens avoid qualified domestic trust requirements with a life insurance trust?
- What are some strategies to avoid the three-year look-back period when existing insurance is transferred to a trust?
- Annual exemption gifts can fund a life insurance trust gift tax-free, but what about generation-skipping tax issues? How is the trust affected?
- When the terms of an irrevocable trust do not reflect the wishes of the parties, what options are available?
- How can life insurance be used as a wealth replacement strategy with charitable giving?
For more tips and tricks for families, visit Motherhood Moment here.
On May 11th, an article by Kelly Greene titled “When It’s Time to Huddle” appeared on page B8 in The Wall Street Journal. Greene’s story discusses an important issue that families across America are facing every day: complicated financial and legal planning for elderly relatives. In the piece, Greene relays key tips for tackling this challenge:
• Be inclusive.
• Don’t delay.
• Hire a professional referee.
• Set an agenda in advance.
• Tap long-distance relatives.
Under “Don’t delay,” Greene captures advice from McManus & Associates Founding Principal John O. McManus that “families should hold meetings before any serious health problems develop.” From the article:
John McManus, an estate-planning lawyer in New Providence, N.J., says there is a “gaping hole” in family planning around preparing for parents’ aging. He considers instituting family meetings among his clients’ families, and in his own, one of his top professional and personal priorities, he says.
“Meetings are critical for getting ideas out on the table,” Mr. McManus says. “There is no one correct answer on how to deal with Mom or Dad’s health issue,” so it’s helpful to have time to think through the choices as a family.
For more tips, check out the full story. And for guidance on how to handle family meetings addressing the health of older loved ones, give McManus & Associates a call at (908) 898-0100.
In celebration of Mother’s Day, Fox News published an op-ed written by McManus & Associates Founding Principal John O. McManus. The piece, “A compass for the road of life: Top 10 lessons I learned from Mom,” shares reminiscences and lessons he learned from his mother. Give it a read below:
A compass for the road of life: Top 10 lessons I learned from Mom
By John O. McManus
Published May 10, 2013 | FoxNews.com
Mom. Just saying the word conjures a kaleidoscope of feelings, thoughts and memories. This woman did far more than change your diapers – she put years of time and effort to prepare you for a life marked by happiness, success and, when necessary, consolation. These ladies are weaving the fabric of society, and on May 12th, our nation comes together to celebrate the most important job that exists — being a mother.
My mother taught me more life lessons than I can count — and sometimes even put into words. But there are a core set of invaluable takeaways as her child that I strive to pass along to my own children and the hundreds of households I’ve worked with over the past two decades as an estate planning lawyer and family wealth counselor. Here are “The Top 10 Things I’ve Learned from Mom”:
1. You only have one chance to make a good first impression – be friendly and dress up. Mom was Miss NYC in her youth, and also a performer, particularly a professional singer. Mom taught us that everyday was a new audition, every relationship an uninitiated audience ready to be entertained.
2. Compliment people all the time – it makes them feel good and you, too. When we were kids, and even today, Mom always makes a point to compliment others. Whether the waiter at dinner, our teacher, or the person at the front desk of the hotel, they always smiled, but I know that Mom’s joy grew in greater proportion to the compliment given.
3. As a parent, focus on each child – in the end, you are only as happy as your least happy child. We all needed Mom more than our other siblings at various points in our lives. Until we all were happy mom was not happy, which meant more food for the hungriest, more care for the most ill.
4. Live a life forging ahead. “There will be time for rest later” Mom would say as we drove from school to basketball then to church. Mom taught us to push through fatigue — in the end endurance is the key to success.
5. Talk about your family history – a lot. Don’t be afraid to tell the same story twice. No one else is writing books about your family’s tales and triumphs. Mom strove to leave an indelible impression on her children. She showed us why our roots are unique and gave us pride in our family name. Today Mom brags to her grandchildren how great their parents are. In this way, Mom reinforces reasons to admire Mom and Dad, strengthening respect for the family legacy.
6. Family starts with taking care of each other. My dad is so appreciative of my Mom’s support, care and encouragement that enabled him to have a fulfilling career with the same company for 60 years. My Mom also looked after her mother until she was 95 — whenever we moved, Nana moved too…we were never more than five minutes away. My grandmother was lucky to have my mother and vice-versa; they were best friends.
7. Regret often stems from failing to take a risk. Pursue your passions, step outside of your comfort zone — many of your limits are self-imposed, and you can transcend them to reach your goals. Mom would say, “If you take a risk and win, it was worthwhile. If you take a risk and lose, you’ve learned a lesson.” The only true failure comes from lack of trying.
8. Work hard, very hard – but not too hard. Mom grew up with her father’s assiduous work ethic; he built a national business from a single truck. Mom taught us that diligent work was essential, but never before family. While she never begrudged my dad for working late or missing dinner during the week, Mom held weekends, family vacation and children’s special events as absolute necessities.
9. Sing out loud! Mom had a singing career through her 20s. Whether in the car, or at church singing always brings her much happiness. Mom would say, when it comes to doing what gives you joy, don’t hum…sing out loud! Don’t just sing alone, but among others. Let them see your passion, but also recognize the unique passions of others singing their own song.
10. Keep the faith. My mother has been a churchgoer her whole life. Whenever the struggles hit, Mom always counted on her faith and the power of prayer. Going to church on Sundays gives her the greatest joy. Speaking with the churchgoers afterwards is equally rich to Mom. Refer back to your belief basics and think positively to create the life that you want.
Moms across the map have lovingly devoted themselves to imparting lessons that provide a compass on the road of life. The legacy of family values you hold close today started generations ago. On Sunday, as you take the time to stop and say thanks to the woman you call “Mom,” recognize not only what she’s taught you, but also that she’s prepared you to add to the legacy.
John O. McManus is a top AV-rated trust and estate planning attorney and founding principal of Tri-State Area-based McManus & Associates.