The Wealth & Wisdom Blog

Information on Estate Planning, Estate and Trust Administration and Unique Asset Planning

New View, Same Approach

As of July 1, 2021, we are now “open for business” in our new office location in Bell Plaza, located in Bloomington on the southeast corner of France Ave. and 494.  If you have not already done so, please update your contact information for us to the following mailing address: 3800 American Blvd. West Suite 930, Bloomington, MN  55431.  Our email addresses and telephone numbers remain the same.  When you are able, please stop by our new office.  We would love to show you the new office location, and perhaps also buy you lunch or coffee.

As our firm transitions to this new era at our new location, I wish to express our appreciation to you, fellow trusted advisory team members, for the opportunity to work collaboratively on behalf of our valued clients.  While we have a new office view, our collaborative approach to assisting our mutual clients has not changed.   In this month’s update I want to share three reasons why I enjoy working together with fellow professional advisors to achieve the planning objectives of our joint clients.


What Job Are You Being Hired For?

In his best-selling book, “How Will You Measure Your Life,” Clay Christensen writes, “Companies focus too much on what they want to sell their customers, rather than what those customers really need.” According to Christiansen, successful companies are able to first determine what problems their customers are trying to solve, and then provide a product or service that is “hired” to solve the problem.

Christensen recounts how a fast food company conducted extensive research to determine why the sales of their milkshakes peaked at two distinct daily intervals.  They determined that milkshake sales peaked in the morning by reason of commuters who purchased milkshakes to occupy them during long work commutes. For these consumers, the milkshake was made thicker because it was being “hired” to solve the problem of boredom.  The company also determined that milkshake peaked in the early evening hours by reason of parents of young children who sought to provide their children with an after-dinner treat. For these consumers, the milkshake was made smaller, smoother and sweeter because it was being “hired” to provide a good excuse for a family outing.

At our firm, we take pride in the preparation of the legal documents that will address a client’s numerous business, tax and family legal issues.  Ultimately, however, the job that we are “hired” to accomplish is not to create a stack of legal documents.  Rather, we are being hired to provide our clients with the peace of mind that comes from knowing that their legal affairs are in order. Our clients appreciate the time and effort we take to explain legal and tax terminology in layperson’s terms, to lay out their options for implementing a plan consistent with their overall objectives, and to work collaboratively with other advisors to achieve those objectives.  Our clients derive peace of mind from the fact that our firm, together with other advisory team members, will continue to be available to them and their surviving family members in the future to address their legal matters.

Initiating Difficult Conversations

Son, we have decided that your brother is going to lead our family company.”

Those of us who are “Minnesota nice” have a difficult time initiating difficult conversations, especially with family.  For example, have you and your spouse had conversations about his or her wishes to remarry if you die? (without naming names, of course).  According to a study entitled, “The Better Than Expected Consequences of Asking Sensitive Questions,” those who fail to initiate difficult conversations are missing out on important benefits. According to the authors, “individuals make a potentially costly mistake when they avoid asking sensitive questions, as they overestimate the interpersonal costs of asking sensitive questions.”  While we often avoid difficult topics for fear of offending others, we miss out on the opportunity to use the difficult topics to deepen our relationships.

In this month’s update, I share a few thoughts as to how clients might communicate difficult estate planning topics with their family.


American Family Plan and Gifts to Children and Charity

A few weeks ago, President Biden introduced proposed legislation under the name of the “American Families Plan” (“AFP.”)  In this month’s update, I wish to summarize the appropriateness, or perhaps the double-meaning, of the name of the American Family Plan legislation.  If the AFP is enacted, certain taxpayers should consider gifts to other members of the taxpayer’s family, or perhaps gifts to favorite charities, thereby benefitting other American families.  There are many uncertainties about the AFP proposal, including the opportunities that wealthy taxpayers might have to liquidate highly-appreciated assets ahead of the effective date of any legislation.  For now, I wish to draw your attention to how two tax proposals, if enacted, would impact gifting decisions.


Charitable Remainder Trusts

A charitable remainder trust (“CRT”) is a type of irrevocable trust that creates a “split interest” in contributed property between the taxpayer and one or more tax-exempt charities.  This type of irrevocable trust structure provides three separate tax benefits: (a) an immediate charitable deduction to the taxpayer equal to a certain percentage of the value of the contributed assets; (b) the deferral of the capital gains taxes on assets contributed to the CRT; and (c) the avoidance of any estate taxes for assets contributed to the CRT.  The CRT planning proceeds as follows:


Margin for Error in Estate Planning Decisions

“Spread the News, Cory,” my friend told me after arriving home from a weekend skiing with his wife and friends in Colorado a few weeks ago, “the pandemic is over.”  While my friend’s exuberance may be a bit premature, I think all of us can relate to a desire to be done with the pandemic.  In this month’s update, I wish to emphasize, through two recent client illustrations the importance of creating margin for error in our estate planning decisions.


Planning for Multi-Generational Living Arrangements

How Much Rent Can I Legally Charge my Mother-in-Law?”

Even before the outbreak of COVID-19 last March, I was interacting with an increasing number of clients considering multi-generational living arrangements. According to  an article last week in the Wall Street Journal, the incidence of these multi-generational living arrangements, defined as multiple adult generations living together in one primary residence, has actually increased during the pandemic.  According to the Journal, 15% of residential purchases made between April and June of 2020 were for multi-generational living arrangements. In 2018, a record 64 million people lived in multi-generational households, which account for 20% of the population.  As home values continue to increase, and many older Americans seek at-home end-of-life care, this trend will only continue.

In this month’s update, I suggest a few important questions to ask mom and dad (the “Senior Gen”), as well as the younger generation (“Junior Gen”), who are considering such multi-generational living arrangements.  These questions are as follows:


Minnesota Tax Law Update

“Dad, it’s so cold outside. Why can’t we live in a warmer state like Grandma and Grandpa?”

This past week, a few of my clients called me from their winter residences in Florida and Arizona.  In addition to their own estate planning matters, we discussed the significant temperature differential between our respective locations.  On a somewhat related note, Governor Walz recently announced his proposals for state estate tax and income tax changes.  In this month’s advisory update, I summarize a few of the Governor’s proposals and provide a brief comments as an estate planning practitioner.


2020 Year-End Tax Update and Planning in a Time of Uncertainty

Our new constitution is now established and has an appearance that promises permanency; but in this world nothing can be said to be certain, except death and taxes.”  Benjamin Franklin’s letter to Jean-Baptiste Leroy, 1789.

For many of us, the end of the calendar year could not come soon enough.  Between the social unrest, political turmoil, the COVID-19 pandemic, and the economic and societal upheaval created thereby, few of us will shed any tears for the end of the 2020 calendar year. Looking ahead, many clients and fellow advisors lament the lack of certainty surrounding government institutions, the future of tax laws, and perhaps the economic outlook.

In this time of uncertainty, I encourage our clients to make decisions based upon the certainties of life, decisions based upon their faith, their love for their families, and their charitable endeavors. Over this past year, I have been honored to help some clients make significant lifetime gifts.  Some clients have helped with an adult child’s unexpected living expense costs, other clients with educational costs of their grandchildren, and other clients with the establishment of charitable strategies. While tax law changes might impact the tax efficacy of such lifetime gifting decisions, I am certain that none of the clients that I assisted this past year with significant gifting matters will regret their gifting decisions, given that these decisions were ultimately driven by non-tax considerations.

Keeping in mind that tax rules are likely to change in the coming years, we should plan on the following tax rules going into 2021:


Four Strategies for Funding a Grandchild’s College Costs

Golf is a game whose aim is to hit a very small ball into an even smaller hole with weapons singularly ill-designed for that purpose.”  Winston Churchill.

As a golfer, I have come to realize, through many poorly-played rounds, that the use of the correct “tool” (that is, club selection) is of critical importance in executing the appropriate strategy.  For those endeavoring to complete a home improvement project, I am told that having the appropriate tool on hand is key to the efficient completion of your project.

Over the past few months, I have had the pleasure of representing several clients who have shared a common planning objective: to provide for the educational costs of their grandchildren.  Ideally, a grandparent will have the personal satisfaction of seeing their granddaughter or grandson move the tassels on their cap and hear Pomp and Circumstance at a post-pandemic graduation ceremony.   Just as certain tools are better than others when it comes to golf or home improvement projects, the most appropriate gifting strategy should be customized for each family.  In this month’s update, I provide a brief overview of four different gifting strategies that grandparents could implement to assist grandchildren with educational costs.


This blog is intended to provide the reader with assistance in understanding various estate planning and trust estate planning concepts. In an effort to keep things as digestible as possible, I have tried to keep each blog post as short as possible.  As a result, an astute reader would see that I often fail to address various exceptions to rules or principals, or how various principles relate to one another.  There are a number of moving parts associated with various planning structures summarized on this blog.  In order to achieve your estate planning objectives, it is important that you receive the assistance of an experienced estate planning attorney.  Otherwise, your family may be in a worse position for your having attempted these strategies on your own.  Until we form an attorney-client relationship, you should be aware that your visiting this blog has not formed an attorney-client relationship, and none of this information can be taken as legal advice.  To contact my office about scheduling an appointment, contact us at 612-465-0080.