2016 Annual Newsletter
Office Happenings
The Heartfelt Legacy Foundation
We, at the Law Offices of Stephen B. Yim, are committed to serving our community and are happy to report that our Heartfelt Legacy Foundation sponsored a Special Needs Presentation in September of 2015 featuring Nationally-recognized special needs attorney Terrie Varnet. The event was well-attended and Terrie, as always, graciously shared her knowledge and experience with us. We hope to bring Terrie back next year some time.
The Foundation is also looking forward to coordinating an effort among medical professionals, lawyers, financial planners, and other community leaders to implement an integrated process about quality of life at End of Life that helps families make, honor, and respect end of life choices. Rather than the usual experience of checking a box as part of a legal document, this process focuses on guiding families in determining what quality of life means for each individual, helping to communicate these choices to loved ones and medical professionals, so that choices are honored and respected. Studies evaluating this type of process show significant positive results in that over 90% of individuals make end of life decisions, and well over 90% are honored and respected (as opposed to about 30% of individuals making an end of life decision in communities that do not offer this process, with less than 10% of choices being honored and respected). Guilt, anxiety, and depression go way down in communities that offer this process.
For those of you who have recently come in for a review, you may have received the Heartfelt Advance Care Plan, a booklet put together by our Foundation to help people think about what quality of life means to them, especially at End of Life. This booklet provides thought provoking questions that that will not only help people determine what quality of life means to them, but it can also help them communicate those thoughts to not only their loved ones, but to their medical professionals as well, when they are no longer able to communicate them themselves.
Office Updates
Jennifer Morgado continues her studies at the ABA approved paralegal program at the Kapiolani Community College, which is part of the University of Hawaii Systems.
As Jennifer looks to developing her skills as a paralegal, we hired Stacie Kauila to join us as our new Administrative Assistant.
Monica Yempuku not only completed her first year of law school at the University of Hawaii, Richardson School of Law, she did so with excellence placing well within the top 20% of her class.
Britta Bourne continues to grow with our firm as she has recently been promoted to office manager. She now holds the responsibility of making sure we all continue to grow professionally here, committed to excellence with compassion.
Periodic Reviews
Periodic reviews are an essential part of estate planning as everything changes — laws, policies, our ideas, and even family relationships. Reviewing your estate plan from time to time gives us the opportunity to accommodate these changes. My responsibility as your attorney, is to help you communicate your intentions clearly at a time when you can no longer speak for yourself.
Try to think about a conversation you had recently where a misunderstanding resulted, and where clarification was necessary. Now imagine how that conversation would’ve turned out if you weren’t there to clear up the misunderstanding. This is the reason why it’s so important for us to use every means of communication available to us to clearly pass on your intentions. This includes: (1) preparing the legal documents such as a trust and powers of attorney; (2) providing each client with our Heartfelt Will, a booklet where they write their intentions down in their own words and handwriting — like an operating manual for their estate plan; and (3) meeting together with their family (and where appropriate, their professional advisors) to help relay their clear intention and instruction.
Reviewing your estate plan not only allows us to gain a deeper understanding of each other so we can prepare a more meaningful plan for you, it allows us to get organized. So often we hear that the appointed trustee, after a parent dies, does not know what the parent owned or where documents are located. The review allows us to double check the funding of your trust, check brokerage and bank account ownership records, and review beneficiary designations for retirement accounts and life insurance.
This periodic review becomes particularly more important with regard to retirement accounts in light of a recent Supreme Court Case, Clark v. Rameker where the Court determined that “inherited IRA” lose certain creditor-protection. This means for each of us, that we must pay closer attention to our beneficiary designations. There are ways to provide creditor-protection for our IRAs that we leave to our spouse and children, and require a collaborative effort among your estate planning attorney and financial planner.
Discounted Powers of Attorney for Your Children Heading Off to College
For the past two years we ran a special for those of you whose children were heading off to college for discounted Powers of Attorney. From June to August, we will prepare a Statutory Durable Power of Attorney and an Advance Health Care Directive for your children for a fee of $395 plus the General Excise Tax. Usually our fee is $850 per a Power of Attorney, but we’ll discount the fee to $395 for both, a savings of $1,305.
If you are wondering whether or not your child needs powers of attorney, you should know that once an individual reaches the age of majority, which is 18 in most states, their parents are no longer entitled to see their child’s medical and financial records, nor are they able to make decisions on their behalf. Once an individual reaches 18, the law classifies them as adults with legal rights to privacy and to govern their own lives. If the unspeakable does happen, and you receive a call informing you that your child is in the hospital unconscious, or in trouble, or in need of your help, a Statutory Durable Power of Attorney and an Advance Health Care Directive can make handling the crisis much easier.
If you would be interesting in finding out more about our Powers of Attorney Special, please contact our office for more information (808) 524-0251.
Three Reasons to Review Your Estate Plan
It seems that good things always come in 3’s. This has been my experience in the new laws that have occurred for us as it relates to estate planning. These significant law changes include the New Statutory Power of Attorney, the Estate Tax Exemption increase, and our new Statutory Creditor-Protection law for real estate. These three laws have solidified as planning opportunities in the last few years. If you have not reviewed with us in the past three years, I strongly encourage you to call to make an appointment to see if you want to take advantage of the new laws.
The New Statutory Power of Attorney
This new Hawaii Statutory Power of Attorney (SPOA) was signed into law in April of 2014. The law came about as a result of many financial institutions refusing to accept a legal Durable Power of Attorney. The purpose and intention of the power of attorney is to keep financial matters running smoothly during periods of incapacity, and financial institutions not honoring these powers during these times can cause considerable stress for families.
The State of Hawaii prepared this new SPOA, which every financial institution must accept, in order to help families keep their finances running during periods of incapacity.
We have developed this new SPOA for our clients, and we encourage each of you to contact our office so that we can assist you in making this new SPOA.
The Estate Tax Exemption
The estate tax exemption for 2016 is $5.45 million per an individual, up from $5.43 million last year. This increase reinforces the need to shift tax planning from estate tax planning to capital-gains tax planning.
If you haven’t yet taken time to explore the possibility of eliminating capital gains tax for your children through the Joint Legacy Trust, we encourage you to come in for a review meeting to discuss this in detail. In short, the Joint Legacy Trust can eliminate the potential for capital gains tax to your children should they sell real estate or other appreciated assets at your passing, making the entire estate tax-free to the children (other than qualified retired assets like an IRA). It can also simplify your plan and clearly reflect your intentions.
The New Creditor-Protection Deed
In 2012, the State of Hawaii became one of two states that allows you to hold property in Trust and maintain creditor-protection if one spouse gets sued. Just driving on Hawaii roads these days, with pedestrians, moped riders, bicycle riders, motorcyclists, people on their cellphones, the narrowing of lanes, the building of bike paths, and the fact that most of us are amateur drivers, makes for a stressful experience. If we make a mistake and hit one of these pedestrians, moped riders, bicycle riders, motorcyclists; we can protect our real estate from an overzealous attorney who would like to capitalize on our mistake.
Professional Development
One of our goals at the Law Offices of Stephen B. Yim is to continue to grow and develop, individually professionally, and as an estate planning law firm. This year our office has designed and will be taking a course called “nonviolent communications” which teaches us to communicate expressing feelings, needs, and requests. The skills that we look forward to developing in this course will allow us to have more meaningful relationships at home, in the office, and with each client. Our mission includes helping each and every client make meaningful estate planning decisions, helping these clients communicate these wishes and choices clearly to their loved ones, so that their choices can be honored and respected. Since our goal is to help communicate our clients’ choices at a time when they cannot speak, it is imperative that we continue to each continue to develop and hone our own personal communication skills.
The legal profession is often criticized for lacking character. Because of this, we at the Law Offices of Stephen B. Yim take this very seriously. Because of this we have begun subscribing to a monthly journal from the company Strata Leadership. The journal focuses on a character quality each month, with the sole purpose of encouraging companies to build character in their organizations.
Reading Recommendations
Being Mortal, Atul Gawande. Atul Guwande is an M.D. who takes a look at modern medicine’s “over medicalization” and encourages us to get back to the humanity of living a good life, to the end.
Sycamore Road, John Grisham. Sycamore Road is a novel filled with suspense, intrigue, and family conflict when the matriarch of the family writes his will and immediately afterwards hangs himself from a Sycamore Tree on the family property.
For future reading recommendations, periodically visit: http://stephenyimestateplanning.com/blog.
MAHALO!
Please allow us to express our gratitude to you for allowing us to assist you with your estate planning needs. As a continued service to you, we hope you find the information above informative. We encourage you to continue to periodically meet with us to review your plan. We hope to see you soon.