Estate Planning in Hawaii with Amphay Champathong

Watch or Listen to the full episode

Interview Transcription

ADRIENNE:
Welcome back, and thanks for listening to the Team Lally real estate show home of the guaranteed sold program. I will buy it. I’m Adrienne. And I’m Attilio if you have any questions just give us a call at 7999596 or check us out online at Teamlally.com.

ATTILIO:
Our guest today is a member of the Hawaii State Bar Association. He graduated from the University of Hawaii where he finished a BA in Sociology, Master’s in Social Work and Juris Doctorate at the William S. Richardson School of Law.

ADRIENNE:
He spent more than 20 years in social work advocating for children who are in the foster care system, and is committed to helping families build strong financial foundations. Please welcome our guest, Amphay Champathong. Hi guys. Yes, welcome to the radio show.

ATTILIO:
So we like to wear like a UH, Uh defensive player, offensive player going after the receiver who’s got the ball, we got to hit them high hit him low. So let’s hit him real quick. Today, we want your you’re an attorney that helps people set up their trusts. Let’s start off with the basics. What is a trust? I just wanted

AMPHAY:
to just add not just a trust, but more an estate plan. Attilio. Yes. So we do estate planning, meaning that we want to be comprehensive. So with regards to trust, simply put it, a trust is an agreement contract between three party. We have the grantor, the person that sets up the trust, a trustee, the person responsible for administering the trust and a beneficiary, as it says the person that’s going to be all parties are going to benefit from the trust.

ATTILIO:
And you know, Amphay, let me translate that local style. You ready? Yes, sir. Okay, here we go. The grantor just grandma, everybody been coming grandma’s house. We’ve been hanging out at Grandma’s house, she got the good retirement plan. She didn’t take care of everybody. And then all of a sudden she you know, she wouldn’t pass away the executor, you know, the executors. That’s your that’s the sibling or the cousin. That’s the most organized. That is the fair. They have the wisdom of King Solomon, and then the beneficiary. That’s all I think kids who didn’t deserve anything. Now. I’m just kidding. That’s all the people who get the stuff from the trust. And people are laughing when they’re hearing this because they’re like, hey, this sounds like my family. And probably every other family in Hawaii because it’s always the same. Everything is awesome. during Thanksgiving, Christmas, everybody comes together, but when somebody passes away, and nothing was clearly there is no clear instructions always going to be done with grandma’s house, grandma’s car, all the stuff in the house. Then it gets a little it gets a little rough around the holidays. But Adrienne, you had a question.

ADRIENNE:
Yeah. So So Amphay, Like who who should be having this estate plan like what kind of people or demographic fit like your clientele.

AMPHAY:
So local style women like nobody be? Yeah, no, beefing no fighting

ATTILIO:
at grandma’s gravesite. Right.

AMPHAY:
A couple of times, you know,

ATTILIO:
come on. Guys, stop everybody.

AMPHAY:
True, true. You know, I think when we work hard when we build our assets to care for ourselves and our family. I think the last thing anybody would ever want is that for that family to break up because we fail to plan know ahead of time, because it happens way too often and you know, in my office, it’s a daily occurrence of us, you know, hearing these stories, and it’s just so sad. And, you know, to tie in what agent had asked, it’s really about families. And you know, we’re talking more to modest families. And we tell them what is a modest family, marriage family, a family that has property that has a couple of accounts. And it’s such a misconception that, you know, estate plan, it’s so fancy, it needs to be this huge a lot of assets and a lot of big million dollar estate, which is not true. And I would argue it’s actually much, much more important for all of our money families to have a plan in place. Because regardless, if you’re Ultra Rich, or you know, you have a property, the cost of having to go to probate is the same, it’s just that to a huge estate, million, couple million dollar estate, it’s a drop in the bucket in terms of the costs, whereas for our modest hardworking families, that could be you know, wasted resource.

ADRIENNE:
So, so Amphay So at a minimum, it would say like, if you own real estate, you should have a trust, you own a house or a condo? Yeah, if you own any kind of real estate, you should definitely have some kind of a trust. Now, if you don’t own real estate, is that recommended to have the trust? Or, you know, what’s the benefit?

AMPHAY:
That Adrienne, I would say, more of an estate plan than just a trust itself? Only because there is so many things, I mean, excuse me, there are multiple documents that consist of what we call a comprehensive estate plan. And then to you know, and the trust is a big part of it. Yet, it’s not the only thing. It serves a broader function. However, there are other doctrines as well, that’s all in competency will be what we consider a proper estate plan. So when you you know, when when the the thought is, is just owning a property, I go, Well, when you talk about estate planning, there are things like a durable power of attorney that says in the event that I become disabled, or incapacitated, now, can somebody asked on my behalf? The Advanced Health Care Directive? Do I help a health care agent in the event that I cannot effectively communicate? Consent with regards to medical procedure or even more importantly, decisions with regard to end of life is there now to I leave that burden to my family and other documents that come with that, in addition to that, so yes, property, but I would frame it in a matter of four, if these things apply to you. You seriously need to look at getting an estate time one, if you have children. If you come from a family, if you own business interest if you have a special needs child, a beneficiary. So all those things don’t apply.

ATTILIO:
And it’s all documented. It’s all in writing. And no one’s coming back and say, well, grandma said I was gonna have the house. And I’m like, What do you mean, you’ve been in Vegas all this time, you never even come visit Grandma, I’m telling you, that’s how the conversation goes. Especially the 2003 Toyota Tacoma, nobody’s cherry lifted with one Molly build sticker on.

ADRIENNE:
So I, I just want to put out this the website that our listeners can go to to find out more information on they can go to EPGhawaii.com. And look for Amphay there.

ATTILIO:
What does that stand for? EPG?

AMPHAY:
Estate Planning Group. Okay.

ADRIENNE:
And so you can find out more about their company, their team, the different types of plans that are offered? And

ATTILIO:
could they could they possibly get a free consultation?

AMPHAY:
Always. So I, you know, we actually pride ourselves. When we talk about estate planning. Our approach is to educate our family. And to go for most we want families to understand what it is they’re setting up, know the value of why it needs to be done. And with that, then now when they do get all of the under state plans in order, they’ll understand exactly, you know, what we’re what we’re wanting to achieve, which is ultimately peace of mind for the families. So yes, to that sort of question of Yeah, it’s the consultation is free. And I actually even go one step further personal for me, it’s really, you know, engaging with families. I like meeting them in the community at their homes, whatever it is that cannot be more most fruitful and efficient in terms of our working relationship.

ATTILIO:
Now, our show does broadcast simulcast all across the state on different stations all around Hawaii. So we know that somebody on kawaii somebody on Maui somebody Big Island, kona Hilo might be listening right now. Could you help them to?

AMPHAY:
Oh, definitely. So of course, we do do the zoom. Thank goodness for technology. And I actually enjoy sometimes going to the nearby islands. It does give me a mini break from my family. Hopefully my wife is listening to the show right now.

ATTILIO:
Next time you take her with you?

AMPHAY:
Oh, yeah.

So actually, we look forward to visiting families, I’m gonna be violent. It’s

like you’re gonna get away. Yeah.

ADRIENNE:
So Amphay, why is a will? Not enough? Like some people just say like, oh, like I got my will together? Why is that not enough?

AMPHAY:
So there is a misconception many times everybody refers to their estate plan, like, you know, they did their will, you know, a will, again, is one piece of the entire estate planning, there are certain things a will will not do. And again, if the purpose of estate planning is to avoid probate, if you have a will, and only a will, the two misconceptions is first, with a will, it only becomes effective when you pass away. So what happens if you’re incapacitated, as you know, a majority of us will go through some period of incapacity. I think the average you know, it’s like about like two years is the last statistic that I read it, that’s where we send in like incapacitated, long term care. And in those situations, a will can do absolutely nothing to help you. So you need other documents that functions in different capacities. The second thing with the will, which makes it Limited is a will does not avoid probate. And so we’ll have to be probated. And what probate means, essentially is that in the event, so probate is a court proceeding, where if you don’t have an estate plan, the courts will appoint what we call a personal representative, Kay, that will be able now to administer your estate.

ATTILIO:
And that becomes a very kind of a public process as opposed to private,

ADRIENNE:
and expensive.

AMPHAY:
And time consuming. And you know, you get into patients for fight. And I think the two of the biggest things are there’s a lot there’s a lot of drawbacks to probate. And that, you know, conversation we can have like take them there are things I want to focus on is the first thing is really the loss of control. The whole point in why we go see planning is we want to the exercise of control. You know, the idea of liberties means I get to do what I want, I want what I want when I’m alive and well. When I become disabled or incapacitated, you know, my access to useful my benefit and my my family’s benefit. And then also when I pass away, you know who I want to give what I want to give when I want to give an hour I want to give essential so when we go to probate case, somebody else is going to do that for you. And some times or many a time, that court or the law or the state of Hawaii may not do what you wish you wanted to do. And that’s an issue and then the second thing I want to point out is the idea of outright distribution. What that means is when something is probated a once the your personal representative pays the taxes pay the expenses, pay creditors, whatever’s left okay? However the law says who it’s going to go to the beneficiaries are going to receive it outright. And there’s a lot of drawbacks with that. Can you imagine if the person getting what you want it to leave for? We’re going through a divorce or they were being super creditors, they owe people money they like I mean all the stuff now ever that they get will be subject to that, that life circumstances that they’re in. And there’s nothing anybody can do cuz by law, the law requires that distribution be made its mandate.

ATTILIO:
Yeah. So

AMPHAY:
that was a lot to me. I’m getting

ATTILIO:
well, it’s you know, a lot of people avoid doing these things because they’re they’re kind of reminder of all of our mortality. But I think it’s it’s a it’s a sign of maturity and wisdom when we do this proper planning sooner than later. And you’d be surprised how you would think that wealthy people With other advisors would know better. But in fact, Prince died without a trust Aretha Franklin and you talking estates that were hundreds of millions of dollars, ugly, went through the and all went through the probate process that took years and probably costs, the beneficiary, you know, if not 10s, of hundreds of 1000s of dollars in legal fees, because everybody was fighting over everything. So do your do your family, do your family, at least a minimum of having a consultation with Amphay, they also too, I think I want to mention too with the zoom, let’s say some of the beneficiaries live on the mainland, you know, maybe Mom, Dad is here, they got some kids on Oahu, and then some kids would move to the mainland, you can include all of them in the consultation, if that would be something the family wanted to do, right?

AMPHAY:
Oh, definitely. And yeah, like we you know, I always leave it up to the families and I use the word family purposefully. Usually I can, it’s going to be mom and dad, when grandparents grandma, and whatever it is that they’re comfortable in between, you know, because there are certain things that confidentiality and our you know, our attorney client privilege, things that for the most part, whatever it is that the family is comfortable in wanting to do. That’s what we would, that’s where we would start from funny Attilio talks about, you know, all these celebrities and things like that, and I just wanted to, you know, as, as we all know, purchase clone on a claw, you know, passed away, you know, a couple months ago. And that was in the news for years. You know, and the other drawback we only talked about probates. But there’s this thing called conservatorship as well, to in the event that you failed to class. There’s this thing called a conservatorship. And it also is a court proceeding, very costly. And again, the two things people fight about is one, whether or not they can come and control, you know, like whether you’re incapacitated. Okay. And the second thing they fight about is who’s going to be appointed? Because who’s going to now control the money? So you like Britney Spears? You know, that conservatorship? Right? Well, Britney

ATTILIO:
Spears, that was a scary, scary Netflix show about her conservatorship that it was even boiled down to the fact that on whether she could have a child or not talk about control. Wow. Yeah,

AMPHAY:
and like going back to Princess Kawananakoa. And knew what they were fighting about was her incapacity and whether or not she needed a conservator, she actually had a trust. But again, the way the language of the trust becomes very important. So with our firm, there is the ability now like the idea of disabilities, for example, you know, you meaning the person that setting up the trust, can make a decision to have this incapacity determination made by like a private title. Essentially, what that means is you pick the people that know you best that you trust to make that determination. So that way, now, we don’t have two doctors saying two different things and causing a lot of problems. And, and, you know, like I shared, it wasn’t even completed yet. And my understanding, and this is a year or two years already, that they swallow spent well over $7 million. And, again, don’t correct me if I’m wrong. The point is, it was a lot of money.

ATTILIO:
Wow. Yeah. belated? Yeah. The other thing that people don’t think about is that when you name the executor, you know, unfortunately, with today’s modern, standard American diet, unfortunately, we’re, you know, that our children are the first generation that will live long, shorter lives than their parents, because of our lifestyle. States. Yeah. So what happens is, you think, oh, I’ll just name one of my children as executor. And I’ve actually seen firsthand where the executor of the wheel died, and there wasn’t, you know, if so, and so PDCs it’s this person and this person. So it’s like World War Three with this family that I’m currently working with on the house. And somebody lives in the house and somebody New Vegas and somebody lives in the mainland, and some people are here and so on. So it’s not talking to so and so. All of this that because they probably didn’t sit down with someone like you and have multiple options and plans in place should some somebody PDC somebody else.

AMPHAY:
You know, in Hawaii, we have a lot of families that live together, right? multi generational families living in a home and I experienced this a lot where say one of the children is raising their family, and they’re living in the family home that consists of grandparents as well. And they lived there for like the last 1520 years. And then the siblings, you know for that the siblings move out to the mainland younger own families and whatnot. And then now, grandma and grandpa passes away. And that sibling that lives at home that took care of them, and then you know, basically paid all the expenses or whatever else is, wait, what happens now? Somebody from you know, my other siblings from this is entitled to what? And then it just it gets really like exactly like what you’re saying. As silly as it happens, because that’s just Hawaii, right? Like, I live with my family. I live with my parents, like, you know, there’s nothing wrong with that. It’s just, we don’t plan. It is like, can you imagine though, like that sibling, that brother that lived in that home? And now his you know, and it’s usually not his siblings that lives on the moon. It’s usually the in laws. It’s just the children but like the nieces and nephew that has no relation to Hawaii that says a where’s my share?

ATTILIO:
A lot of times to the third. Yeah. Well in the occupants not paying rent. So now they’re kind of stuck financially being in that position. And that’s what we see all the time. They kind of move and they want to stay on like, Okay, you haven’t been paying any rent, how are you going to make the $3,000 a month mortgage payment, now that grandma’s dead? And so they ended up in foreclosure? And then we’re bailing them out at that point, too.

ADRIENNE:
And we are coming to the end of our show. So Amphay, could you shout out a good phone number that our listeners get a hold of you at? I know, we’ve been to the website, EPGhawaii.com. But what’s a good number for them to call you? You know,

AMPHAY:
I’m gonna leave you my cell number because like I said, I like the meeting my family’s out in the community a lot as well as living homes. So my direct line is 8082189301. 2189301. Yes. Okay. So

ADRIENNE:
give him a call, get that consult. Ask some questions. He’ll take care of you.

ATTILIO:
You know, I think the only regret anybody will have is that they didn’t call Amphay sooner.

ADRIENNE:
That’s right. Thank you. Thank you, Amphay.

AMPHAY:
So thank you guys so much. Have the rest of that great afternoon. Thank you. Attilio. Thank you, Adrienne. Thank you for this. I’m getting excited. I’m all excited right now.

ATTILIO:
Yes, thank you so much.

ADRIENNE:
Okay, thanks for listening. And thank you to our sponsors.

Follow Us On Social Media