Non Financial Aspects of Estate Planning

2016-03-09 15.23.39A friend asked me to¬†give this talk to his firm, but I prefer to write short articles. ūüėČ

When families talk about estate planning the discussion can center around cash flow, assets and tax minimization. While those topics need to be sorted, dollar-centric living can lead to regret.

If¬†you apply last week’s tips about family leadership, you might¬†discover certain realities about financial wealth.

2016-03-16 13.56.23Namely…

The highest use of¬†an asset lies in its capacity to enable better choices…

  • flexibility to allocate time towards shared experiences
  • the ability to control one’s schedule
  • the opportunity to tag along when other people are doing what they enjoy
  • health in the context¬†of body, mind and spirit

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2016-03-13 21.51.50Cash flow without education, connection and meaning can be a negative. Examples are the challenges faced by lottery winners, professional athletes and young, highly paid professionals.

With cash flow, I would go further and point out that excess family cash flow will ultimately be consumed by the least responsible adults in a family system.

You might tell yourself that you are “doing it for the kids” but the money ends up being blown¬†by someone’s aunt or uncle.

2016-03-11 20.04.44-1What to do?

  • In your lifetime, use¬†money to acquire time.
  • Share time with people you wish to influence with your values. Be the brand.
  • Remember that it’s better to¬†earn, and spend, our own way in life. It’s what you did.
  • Have a bias towards “assets used for shared experiences,” rather than cash flow.

Ask the question, How do I wish to be remembered?

Be that person, today.

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2016-03-10 08.52.21Shared experiences, both positive and negative, bridge generations across time.

As a child, I had¬†four grandparents and three great-grandparents. Of my childhood elders,¬†only one made the transition into my children’s consciousness. The elder that bridged across did so because¬†my daughter and I were involved in her end of life care.

Love, not money, is what travels across time.

2016-02-24 16.51.20

What I Learned Last Year

biscottiTwo themes have dominated my goals for the last couple of years: my relationship with my eldest daughter and my finances.

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Kids – my daughter worked herself out, no input from me. I didn’t change her nature, I accepted it, and we enjoyed the inevitable¬†progression from preschooler to school-age girl.

For my pals with kids – avoid abandonment and retaliation – everything else is details.

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Optimism is the only worldview borne out by the facts.

At the end of 2008, I wrote-off 65% of my family balance sheet, was unemployed, owned a loss-making business and was facing civil liability relating to large-scale fraud.

You may have forgotten but everything we were reading was doom and gloom. In reality, that was one of the most useful periods of my life because I was forced to face the gross inefficiency of my spending choices.

The changes that result from earlier¬†setbacks lead¬†to an appreciation of a more simple life and I’ve continued to strip away non-core activities.

My wife is stumped when¬†asked, “What does Gordo do?”

I enjoy my life and serve my family

Act in the spirit of service to the people that love you.

Act as if things will work out.

Keep simplifying.

Free yourself to spend time on what matters.

For the pessimist in your head that likes to point out that we’re all dead in the long run… be wary of overstating your importance in the world.

My death will be a setback for a few people¬†but it won’t change the positive trajectory of history. I will¬†play my role then hand off to the younger generation.

There will be tears and¬†that’s OK.

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Human Capital & Family Finances

What can each of us bring to our families, and communities?

Strong relationships built on mutual respect and strengthened via self-improvement.

Six years ago, I was left with a home and cash assets. With interest rates moving towards 200-year lows, I realized that I had to be invested. I made an error by going all-in with real estate. Why an error?

  • I was geographically concentrated – the bulk of the portfolio¬†was within two miles of each other.
  • I invested too much – I failed to understand the short-term cash needs of my young family, which arrived in 2008/2011/2012.
  • Each asset¬†represented many¬†years of living expenses – lumpy assets¬†are inefficient when you’re moving towards retirement.
  • Real estate takes a long time to sell. With a traditional portfolio, a gradual sell down is easier to achieve.

My purchases had a margin of safety and I was able to trade my way out of the situation Р4 out of 8 addresses have been sold. Start to finish, it will take 8-10 years for me to change my asset allocation. Our family financial structure gave me time to make the change, we earned income, and we had exposure to asset appreciation.

Time worked things out Рwe did well but so did all others that were invested from 2009 to 2014.

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The final lesson –¬†I am greedy in irrational ways. I can soothe my ego by noting that my flaws¬†are widely shared.

I am susceptible to the Endowment Effect. I overvalue what I have – my wife had to force me to sell our old house, I wanted to hold out.

I overvalue future¬†desires. I’m constantly fooling myself that MORE¬†will make a difference.

My antidote:

  • Write down my desires¬†(steam shower, truck, boat, kitchen appliances, vacations, clothes, car, office, ski chalet) then wait and let desire¬†pass
  • Make the wealth¬†cost of “more” both painful and visible
  • Note the choices that create¬†my best days (train AM/PM, help someone, learn, write, teach, spend time with my wife, under scheduled)
  • Spend money to create¬†true luxuries (childcare, time to think, time to learn)
  • Schedule my happiness essentials (time in nature, time with my wife, quiet time to think)

Keep it simple:

  1. Notice the good in life
  2. Write good things down
  3. Do more good things

True Strength

g_aqua

One of my coaches, Mark Allen, made the observation that to get our race in order, we need to get our lives in order. Racing, like any other form of stress, can strip away our filters.

Mark’s advice is¬†an example of an athletic lesson¬†with a wide application into everyday living.

We share¬†a desire to be strong. This desire is expressed by building up and adding to one’s self.

  • Adding size through muscles, bulk, heels, boots
  • Adding tension from taking on obligations
  • Adding palmares from victories
  • Adding possessions and external¬†signs of power

I’ve done it all: cowboy boots; academic honors; powerlifting; fancy cars;¬†big houses; jewelry for my wife…

Adding, adding, adding.

The list above is about¬†our external life. Building up is a projection of strength, but it isn’t true strength.¬†I think Mark is pointing us towards something that might become¬†resiliency. An integrated life where¬†we are in¬†harmony with our external projection and OK with all aspects of our experience (strong/weak, happy/sad). This harmony lets¬†us cope with the tests of our races (and lives).

Perhaps you’ve had a situation where you tell yourself¬†to be “strong” but a more accurate description is a fear that our¬†inner storm might show¬†through. Having completely fallen apart a few times, isn’t that big of a deal. I don’t want to make a habit of it but I also don’t want to spend my life holding tight and letting the pressure build within me.

When tired, when grieving, when sick, when stressed… life has a way of stripping our filters away.

But how can we process our inner life?

  • Exercise works well for me – moderate effort, repeated movements
  • Others prefer meditation – cultivating stillness and observing¬†one’s mind
  • Many find the combination of breathing and movement in yoga to be effective
  • Thrill seekers tend towards extreme risk and peak experience – works for them but doesn’t work for the larger goals of my family

If we keep peeling away our layers then we might find that the joke is on us.

Why?

Ultimately, every individual unravels.

It can be terrifying when we bump into this reality. You may have experienced this fear through the death of friends, parents and grandparents.

Ultimately, we might find comfort in defining resiliency in terms of something larger than ourselves Рfamily, legacy, lineage, tradition.

Cultivate courage by staying open towards little fears.

Scope Lock

It’s easy to let short-term¬†news dominate our thinking.

  • Children killed in war
  • Lost airplanes
  • Destroyed airplanes
  • Crashed airplanes

With death, in particular, I was curious.

I asked Google, “How many people die, per day, in the world?”

Google replied, “about 150,000.”

Per DAY.

That helped me put my obsession into context.

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Realizing that my thoughts are largely wasted can create cognitive dissonance.

…but it’s awful

…I need to care (to show I’m a kind person)

I ask myself, ‘is linking worry to goodness effective?’ In my life, worry makes me anxious, not compassionate.

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Here’s what I’ve noticed in myself. There’s a hidden cost to obsession with others.

The more I focus on seeking to change others, the less energy I have to change myself.

What one thing, if it happened, would change everything?

In my case, kindness through daily action in my own house.

Beware of feeding what you want to leave behind. In my case, fear – anger – anxiety.

Talking About Dementia

The medical director of the hospice where I volunteer gave a lunchtime presentation on dementia.

An interesting stat she shared was 45% of people 85 or older will show symptoms of dementia. With longer life spans, we’re going to be dealing with more dementia.

The mechanisms for the various types of dementia are not well understood but she cited the following risk factors:

  • Heart disease
  • Stroke
  • Alcohol use
  • Diabetes
  • Family History of Dementia

Like most of us, I have all-of-the-above in my family tree. If I live long enough then it’s likely that I’m going to bump¬†into dementia.

What to do?

  • Consistency and routine in daily living
  • Physical and mental stimulation – stay engaged in your family, in your community, consider part time work
  • Safety – ID bracelets, honest discussions about driving
  • Reminders & Cues – at 45 I have a system in place to manage my days – if you are used to subcontracting all your admin then consider bringing it back in-house before you become part of the elder¬†elderly.

With my grandparents, we used atomic clocks (automatically set for time, day of week, date, month) to help them keep track. Towards the end, I ran my grandmother’s¬†calendar and would handle arrangements for key appointments. They were both in assisted living and my grandmother commented that she would have moved in earlier if it wasn’t for her reluctance to ask for help.

There was an excellent question from the audience… Do my visits have any impact? The doc made the point that the impact of a visit might be¬†not seen until later – when the patient is happier, more content. Don’t assume that low, or no, response means that you’re having no impact.

In my own family, the anticipation of a visit was very positive. I went as far as planning a series of rotating visits more than a year in advance. Each elder needs a champion to marshall caregiving resources.

Likewise, with demented patients, don’t assume that negative behaviors are disease related – the patient could be acting out in response to pain, lack of stimulation or excessive stimulation.

Interesting point for older athletes – the body’s thirst, and hunger, mechanisms dull with age (as well as due to dementia).

The doc shared that artificial feeding of demented patients doesn’t¬†prolong life¬†and changes the nature of death – this is due to complications associated with tube feeding.

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The thought of losing one’s mind is terrifying and the topic of assisted suicide came up. We didn’t have time to explore that issue, but it’s going to be on the 2015 ballot in Colorado.

Given dementia rates in my family, it strikes me as more productive to create a care plan, rather than relying on a quick death, or euthanasia.

I was also left with the following:

Be sure to consider¬†“who’s suffering?”¬†80% of hospice patients have cancer so my experience with the demented is limited. That said, be sure to look inward when you’re dealing with a family member with dementia. Our minds¬†can torment us more than the disease torments our loved ones.

583My grandfather had advanced dementia and was fully capable of experiencing happiness and joy. He maintained his dignity, if not his memory, until the end of his life.

The death of an elder is an opportunity to make better decisions within the entire family. What did we get right? What would we change? What advance directives are needed for the next generation? for myself? Is my life structured appropriately if I start to experience symptoms of dementia?

IMG_0920Most personally, it strikes me that if I decide to kill myself then I deny my community the opportunity to learn from the end of my life.

As a society, we can learn to live better by taking care of people on the way out. My grandmother was moderately demented at death. She faced death with courage and caring for her was a gift, not a burden.

Watching a loved one¬†unwind from Alzheimer’s is extremely difficult¬†and I hope to have the ability to avoid¬†judging opinions different than my own.

Real people, tough decisions.

The Most Beautiful Man In The World – Talking To Kids About Dying

Orion

Did you know that¬†Orion was¬†the most beautiful man in the world? Here’s a link to his¬†story – a personal favorite of mine.

How can I¬†talk about death without¬†freaking out my kids? First up, I don’t start the conversation. However, I don’t avoid it either.

There is a split between older (4-6 years old) and younger preschoolers (2-3 years old) and my approach differs between the kids, as well as how they are feeling when they bring up mortality.

My first conversation about death with my son (2.75 years old) started when he picked up a line¬†that stuck in his head, “David’s Daddy Died.” At two, death doesn’t have meaning and I don’t want him to get locked onto thinking that mom/dad might disappear on him.

From an early age, we’ve taught him that “we will be coming back” when we leave him. Indeed, a key milestone of childhood development is the ability to self-comfort when separate from our parents for 1, 3, 5 and 7 hours. We started this process, gradually, with all our kids as soon as possible.

Axel’s nature means that he experiences less separation anxiety than our other kids. Still, he looked to me for an explanation about “David’s Daddy Died.” Here’s what I do each time…

  • I go down on one knee
  • I look him in the eyes
  • I open my arms for a hug
  • I say, “YOUR Daddy’s right here”
  • I give him a huge hug

Sometimes it takes a couple repeats of… “Your Daddy’s right here” but it always works to bring him to the present, give him reassurance and shift us back to whatever we were doing.

With a 4-6 year old, the conversation is different. My oldest understands death and can have questions about it. She remembers her great-grandmother (who died on this day one year ago) and has asked me about it.

  • What’s death – your body stops working
  • Is she coming back – no, her body is finished
  • Is it like sleeping – no, it’s different
  • Daddy, are you going to die –¬†Sweetie, everything ends
  • How long until you die – likely more than 40 years

And the biggie… Daddy, where will you be when¬†you die?

  • Once again, I look her in the eyes
  • Put my hand over her heart
  • And say, “I will always be with you. Even when I’m not with you, just close your eyes and you will feel me in your heart.”

I then choose a person – perhaps my grandmother, or her mother – and we both put our hands on our hearts and think about that person. “See you can feel the person, even when they aren’t in the room. That’s where you go.”

When they get a little older, I’ll teach them how to spot Orion in the sky and share that he was the most beautiful man in the world.

When they see Orion, I’ll tell them to always remember that I love them.

See me beautiful.

 

Say What Needs To Be Said

When I tell people that I volunteer at hospice, I get one of two replies:

  • I could never do that; or
  • It’s a good thing that you’re doing.

Most hospice patients are at home, so the majority of volunteers are working in the field. Of the 300 patients that might be on a current census, only 8-10 will be at the Care Center operated by the group.

My field work falls into the categories of respite, light housekeeping, day trips and errands. Volunteers also help with companionship, comfort touch, meal prep, massage and life review. The field work is usually easy – guidelines limit what a volunteer can do and we’re able to opt out at anytime.

As you’re working solo in the field, it can be a little lonely. The group recognizes that aspect and holds monthly volunteer connection meetings. I haven’t made it to any of these meetings. Being “alone” is a pleasure for me.

In addition to the field work, there’s a Care Center. Patients are admitted to the Care Center for family respite, to get medications sorted (usually pain/nausea/agitation) or, if they don’t want to die at home.

What surprised you? The biggest surprise is how little I’m working with dead people. Before I started, the team emphasized that a lot of living happens on hospice. They were right. 99% of my time is with living patients¬†and I have the freedom to opt out of the 1%.

Are the dying in constant pain?¬†At the bottom of my fear of death lies unknowable and uncontrollable pain. Working at the acute end of hospice care, I was surprised that there wasn’t more suffering. To be clear, I have seen true suffering but it is less than 5% of all patient interactions. Young people dying of cancer and patients dying after being on a feeding tube have been the most emotionally challenging.

Isn’t hospice about giving up?¬†I sense that many families see hospice care as pushing a person towards death. With my grandmother, most of our family (myself included) wasn’t willing to consider hospice (so Nana died at a palliative care ward). Watching the team, what’s emphasized is:

  • Optimizing the time that remains
  • Putting the patient and family in control
  • Ensuring dignity & comfort.

As well, there is a strong network within the grief services team to help the survivors continue living.

Don’t postpone joy.¬†I’ve shared laughter with people that are close to death. This has been a valuable lesson for my unnecessary attachment to being “miserable.” Always stay open to happiness.

Every generation needs a caregiver.¬†Volunteering at a care center is free training in an environment that can be “scary.” It’s only taken three months for my boundaries to be reset. As a parent, there is (now) nothing that my kids can produce that will freak me out. My sick kids, and their diapers, have been put into a better perspective.

Tips to conquer fear. The group does an excellent job managing their volunteers. I noticed:

  • Everything is optional
  • Responsibility for outcome is removed – that lies with the professional team
  • Acceptance of mistakes – I don’t always say the right thing but that’s OK
  • However, clear boundaries are established to prevent serious mistakes (no medical care, no feeding, no giving of medicines).
  • The above show me the difference I can make by helping with “small” things. Listening to a spouse, taking out the trash, sorting laundry, refilling inventory… I’ve experienced deep gratitude from little acts of kindness.

If you feel the calling then follow it. There’s tremendous value to you and your community.

Within the constraint of “do no harm,” say what needs to be said.

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