Bielski Law Office, Ltd.

Using Wealth to Cure Illness

A recent trend is wealthy people spending vast sums to fund research into cures for diseases that family members suffer or died from. That can be great, but it can also create problems.

Getting funding to research and possibly cure rare diseases has never been the easiest thing for scientists to do. Since some diseases are so rare, they do not get enough public attention for policymakers and private donors to get interested in funding research.

However, there are many wealthy people in the world. Their family members sometimes have rare diseases.

Through foundations, regular charitable giving and estate planning, many of these wealthy people are taking it upon themselves to fund the research into the diseases that their family members have suffered from, as The New York Times reported in "Bringing Family Wealth to Bear Against Relentless Illness."

This can have extremely beneficial positive effects on research into these diseases, especially if a wealthy donor is able to convince other wealthy friends to also contribute.

Research into several rare diseases has progressed greatly as a result of wealthy donors. However, there can also be problems associated with this type of funding.

In an effort to find cures for diseases, some donors have not adequately ensured that proper scientific and medical protocols are followed and have even pushed hard to not have them followed.

Public policy experts also worry that this funding of specific rare diseases can lead to less research into more common diseases that afflict many more people, as researchers are pulled into the funded rare diseases.

Funding research into curing any disease is important, but donors need to be certain they are doing so following proper protocols and the greater interests of the public.

Reference: New York Times (April 28, 2017) "Bringing Family Wealth to Bear Against Relentless Illness."

Your Collection and Your Estate

A person who has spent a lifetime building a collection of anything and is working on an estate plan, often wants that collection to remain in the family. That can be difficult, if your children are not interested in the collection.

It is not exactly a secret that children often grow up to have different passions and interests than their parents. A parent might have a love for old movie memorabilia and amassed an impressive collection over the years. The children, however, might not have a connection with that memorabilia and might not be interested in it.

This can be a problem for many collectors, since they fear having their collections broken up after they pass away with the individual pieces going to strangers, as Barron's discusses in "How to Get Your Child Interested in Your Collection."

One thing that collectors can do is work to get their children interested in the collection.

It is best to start this when your children are young by including them in the collection process. However, if it is too late to do that, there are alternatives.

Parents can talk to their children in order to let them know why the collection is so important and what it would mean to the parent if the collection were to be sold out of the family. This helps give the children an emotional stake in preserving the collection.

If that does not work, then collectors do have some estate planning options about how their collections should be handled. For example, it might be possible to bequeath the entire collection to an interested museum or library.

Reference: Barron's (May 2, 2017) "How to Get Your Child Interested in Your Collection."

Your Children and Remarriage

If you are planning on getting remarried and have children from previous relationships, it is important  for you to think about how to preserve an inheritance for your children.

Although state laws have some variations, a general rule is that if you pass away without a will, then your closest living relative will get your estate. If you are married, it normally means that your spouse gets everything.

This can be a problem if you have children from a previous relationship, since your spouse will not be obligated to preserve anything that he or she inherits and give it to those children.

It is, therefore, important that you make plans for your children, as the Wills, Trusts & Estates Prof Blog discusses in "Protecting Your Children's Inheritance After Remarriage."

Some ways to accomplish this include:

• Get a prenuptial agreement before you get remarried. In a prenuptial agreement, you and your future spouse can agree that some of your assets will go to your children after you pass away.
• Create a trust that allows your spouse to use some of your assets while he or she is alive and that gives the remainder of the assets to your children after your spouse passes away.
• Name your children as beneficiaries of your retirement accounts or life insurance policies.
• Create a will that gives specific bequests to your children.
• Give your children gifts while you are still alive.

In the end, make sure that you work with a qualified estate planning attorney to get it done right.

Reference: Wills, Trusts & Estates Prof Blog "Protecting Your Children's Inheritance After Remarriage."

Trouble in Louisiana

An estate case in Louisiana has raised ethical concerns for the local executive director of the council on aging.

A few months ago, a 95-year-old woman in Louisiana, Helen Plummer, passed away. Her family knew that she had about $300,000 in liquid assets and two homes.

What they were not aware of, is that a will had been drawn up for Plummer and they are extremely unhappy about that will.

About two years ago, Plummer started visiting the local council on aging. While there, an attorney board member of the council drafted a will for her. The will created a trust to oversee Plummer's estate.

The executive director of the council was named as the trustee and given a $500 monthly benefit from the trust for her services until the last trust beneficiary reaches the age of 30, which will occur in 21 years.

WRBZ2 reported on this story in "Family claims 95-year-old swindled by Council on Aging director."

Upon learning of the will, the family began removing cash from Plummer's bank accounts, since they were afraid the director would seize it. This prompted the director to sue the family members.

They claim that they have not spent any of the money, they have records and it was inappropriate for the director to be given a stipend in a will which the council on aging had drafted and the family was not told about.

Local elected officials have become involved in the case, since the director's actions may be against the state's ethics rules.

This case is interesting since it is often appropriate to name a non-family member as a trustee who can be trusted to act independently and that trustee is normally paid for the services. However, there are ethical concerns for a council on aging to draft such a will for the benefit of its director.

It would be more appropriate for an outside attorney to advise on and draft a will.

Reference: WRBZ2 (April 29, 2017) "Family claims 95-year-old swindled by Council on Aging director."