Retirement planning? Arranging your affairs before death? Getting your estate in order? Thinking about making a will? Preparing a will? Interested in protecting principal or preserving capital? If so, you might want to know that there’s another kind of principal protection and capital preservation. And I wrote a series of articles on just that!
Cherchez-vous un avocat? Seeking an attorney? If a small business owner, I understand what it took to start an enterprise and make it successful. I also know that a generational transfer is difficult to navigate especially taking into account the tensions arising from the family dynamic. Seeking one of the family law lawyers or family lawyers Montreal, dealing with the elderly? My law firm is located in Montreal and I believe that it’s the one for you or your family. I practice in the civil law area – one of my specialties is civil-elder law. And I have represented the senior or a family member. Indeed, I wrote the book (Please visit www.practitionerspress.com) – two in fact, notably
Elder Law in Canada**ELIC**” Estate Document Professor** EDP**
Vol. 11, #16.3 – Dec. 16, 2019–ALLAN GOLD’S BLOG
Ever thought about your money, going …going… gone, once you’ve passed?
If not, maybe you should! (Part #3)
As you know, my current subject is money. More precisely, it’s on “capital preservation.” This is defined as “a strategy for protecting the money you have available to invest by choosing insured accounts or fixed-income investments that promise return of principal.” (Source: https://financial-dictionary.thefreedictionary.com/Capital+preservation). However, I’m using this notion differently – not from the perspective of the investor, but rather, from that of the will-maker (known as a Testator, if male or Testatrix, if female); and this, with a view, following decease, to preserving some or all of the principal arising from his/her estate. Of course, such raises the primordial question as to whether or not one should now try to do that. But I shall let each of my readers answer that very good question for himself (or herself).
Since I introduced my topic in the first blog of the series and in the second, I gave you my thesis and started my argument, I’ll now continue proving my case by giving you more real life examples.
- THESIS & ARGUMENT.
B.3 Pleading By Citing instances of Lottery Winners, Who Weren’t So Lucky After All!
Last time, I started off with a 1997 winner who seemingly suffered from 3rd party pressure and give-a-way tension, ultimately falling victim to the same. Indeed, this appears to be a typical problem for the ‘suddenly rich.’ Now, let’s consider several others who also had to deal with an out-of-control urge to buy, addictions, etc.
B.3.2 Evelyn Marie Adams. Once upon a time, there was a convenience store clerk from New Jersey who got double good results in a lottery. You see, in October 1985, Adams was a winner in the state’s Pick-6 lottery game, receiving $3.9 million. Thinking that she could continue her winning ways, she kept playing and in 1986, she won another $1.4 million. With her prize money totaling $5.4 million, she had many requests for financial help. She later lamented, “A few of my relatives were angry because I had so much.” But while that might have been difficult, it seems to me that she liked the casinos in Atlantic City a little too much. Maybe she thought that ‘Lady Luck’ was still smiling on her. However, this “Gambling Lady” gambled and lost …the majority of her money. By 2012, she landed in a New Jersey trailer park. Indeed, she was quoted as saying, “I’m broke now … I work two jobs.” She added, “My advice to anyone (who wins) would be to go to your lawyer and accountant first.” While some people might dismiss her as a ‘two-time loser’ because she had twice won big and lost out, I wouldn’t do so. Instead, I would defend her, explaining that human frailties just got the better of her.
B.3.3 William “Bud” Post III. Good fortune came in 1988, when Post, then in his 40s, won the $16.2 million Pennsylvania lottery jackpot. This was quite a change of circumstances for someone, who was then seemingly just getting by, working at carnivals. With $2.46 in his bank account and living on disability payments, his prospects were then not very good. But after getting his hands on the big bucks, he seemingly went on a binge, ‘spending money like a drunken sailor.’ You see, in the two weeks after getting nearly $500,000, he spent about two-thirds of it. Perhaps thinking of himself as something of an entrepreneur and investor, he bought a used-car lot and a restaurant. During this whirlwind shopping spree and regardless that he didn’t have a pilot’s license, he even purchased a twin-engine airplane. In three months, he was $500,000 in debt. In one year, his debt rose to $1 million. It’s noteworthy that this was after being urged by relatives to invest in business ventures, which didn’t pan out. But that’s not all! He further got conned by his landlady into giving her 1/3rd of his money. If that wasn’t enough, his brother was arrested for plotting to murder him. He was also confronted by the fact that his then sixth wife had hired a hitman. Since, his annual after-tax prize payments of $500,000 were spent with little thought of the future, he filed for bankruptcy in the early 1990s. Indeed, he ended up as something of “a (16.2) million to one” guy! His bankruptcy lawyer, John Lacher, described it as a “Beverly Hillbillies” story, saying, “He did everything you would expect of a guy who became a millionaire overnight…While you might buy one laptop, Bud would see the same laptop and buy 30.” Afterwards, Post remarked, “Everybody dreams of winning money, but nobody realizes the nightmares that come out of the woodwork, or the problems.” He even admitted, “I was much happier when I was broke.” In 2006, at the age 66, Post died of respiratory failure. It’s self-evident that Post liked to buy…buy and buy some more. While some people might say that he was a “Shopaholic” type who shopped until he dropped, I wouldn’t do so. Instead, I would defend him, explaining that he was confused. For me, he wanted so much from life and mistakenly thought that he could make purchases in order to fill the deep void that he felt. Of course, meaning and contentment cannot be found on a store shelf or after signing a purchase order.
B.3.4 Michael Carroll. In 2002, Carroll, a 19 –year- old Englishman, whose then occupation was a garbage man, was the lucky lottery ticket holder, winning £9.7 million (about $14.4 million at the time). However, he straight away went through the money, purchasing a mansion, drugs and gold jewelry amongst other things. In ten years, after losing it all, Carrol found himself living off unemployment checks. While some people might call him “Lordy Big Spender,” I wouldn’t do so. They could try to explain his downfall as being a matter of ‘easy come, easy go.’ I disagree. I would defend him, explaining that he just didn’t have the tools to deal with his new situation.
My questions at the outset bear repeating. Retirement planning? Arranging your affairs before death? Getting your estate in order? Thinking about making a will? Preparing a will? Interested in protecting principal or preserving capital? If so, these sad stories may have surprised you so much that they dislodged you from your comfortable perch causing you to rethink long-held assumptions. Or in effect, such knocked your block off, leaving you reeling and after falling on your butt, you wonder what to do next. Or they may have rocked your boat so violently, that you’re figuratively overboard in the sea, flailing and gasping for breath. Regardless, I’m not going to let you out of this fun house just yet. There are even more stories to come next time.*
D. PREVIEW OF NEXT IN THE ELDER LAW BLOG SERIES.
I believe that with this blog series, I may have started you along the way to being more aware of elder law. I will continue on with the subject of retirement planning and more particularly, principal protection and/or capital preservation after you’ve passed on. Stay tuned, I will recount further stories in order to build my case. Interested? Want to get more information about the current topic, retirement planning, or other areas of elder law written by an “avocat,” one of the family law lawyers, family lawyers Montreal, practicing in the elder law field? See you next time. It won’t take too much time. Remember my byline – it’s “Gold’s Legal Minute*GLM*!” And please don’t forget to join my professional community by entering your e-mail at the prompt. *
E. NOTICE – CAUTION –DISCLAIMER.
The material provided herein is of a general nature, strictly for informational purposes. The interpretation and analysis is not to be misapplied to a personal situation with a particular set of facts. Under no circumstances, are the herein suggestions and tips, intended to bring a reader to the point of acting or not acting, but instead, the hope is that they are to be a cause for pause and reflection. It is specifically declared that this content is not to be a replacement of, or a substitution for, legal or any other appropriate advice. To the contrary, for more information on these presents, related subjects or any other questions, it is the express recommendation of the author that everyone seek out and consult a qualified professional or competent adviser.
* ©/TM 2019, 2015-2018, Allan Gold, Practitioners’ Press Inc. – ALL RIGHTS RESERVED
** ©/TM 2006, 2008, 2018 Allan Gold, Practitioners’ Press Inc. – ALL RIGHTS RESERVED