Developing Your Life Plan

Making Sure Financial Documents are available during a family chrisis can save you time, money, and pain

someone to make medical decisions should you become incapacitated.

PASSING WEALTH TO THE NEXT GENERATION
Having a will or trust alone does not mean that you have an estate plan. The above documents will help your family manage through the difficult times involving death or major injury, but only a team of professionals can formulate a strategy for the distribution of family assets, tax savings strategies, insurance coverage, and financial planning that will make for an effective estate plan. “African Americans have made significant strides in terms of economic empowerment, and estate planning is extremely important for us so that we can retain what we’ve accumulated as a legacy for successive generations,” says financial planner Creuzot.

The challenge of distributing assets among six adult children is what motivated Paul Norman and Lurline Baker-Kent to get serious about estate planning. The couple’s plan includes two irrevocable trusts that will prevent nearly $2 million in combined assets from being challenged in probate court. Since Paul, 60, and Lurline, 63, each had a previous marriage, the trusts also prevents former spouses from contesting their assets in court.

With Lurline’s four sons (Michael, 44, Keith and Kenneth, both 42, and Darnell, 39) and Paul’s son and daughter (Chad, 24, and Lisa, 39), the couple did not want their blended family squabbling over assets when they die. Paul is a psychologist at Hennepin County Health Mental Case Management and Lurline is a retired assistant commissioner and founding director for the Center for Excellence in Urban Teaching at Hamlin University in St. Paul, Minnesota. The couple’s assets include a $325,000 home, a $400,000 life insurance policy, $100,000 in mutual funds, and two time-share condos in Hilton Head, South Carolina. They say the $2,000 it cost to create the trusts is well worth it.

“Our
kids get along fine, and we want to make sure there is no haggling or ambiguity over the assets,” says Lurline. “People might not do this because it’s not free, but it can help eliminate a lot of grief and bickering between offspring.”

Lurline has an additional trust that includes a $200,000 home in California that her 82-year-old mother will live in until she moves to a nursing home. The trust states how assets should be used to make mortgage payments, pay taxes or other expenses while her mother lives there. Upon her mother’s death, the trust calls for the home to be sold and the money to go to Lurline’s 58-year-old sister Marie Carter, their mother’s caretaker. Lurline’s main motivation for doing this trust is to ensure that, should she die, her mother will be taken care of.

“We, as African Americans, are afraid to raise [estate planning] issues because feelings of distrust or bitterness come up,” she says. “But a family is a business, and we need to look at it that way.”

Lurline and Paul’s strategy was recommended by their financial adviser, Marilyn Broussard, a certified financial planner at the financial services firm of Waddell & Reed in St. Paul. In addition to advising clients about the

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