The Truth About Estate Planning with Amphay Champathong

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Interview Transcription

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

ATTILIO:
Hey. And our guest today arrived in Hawaii with his family after spending a couple of years in camp, in a camp he grew up in Kalihi, attended Kalani High School and went on to complete his college education at the University of

ADRIENNE:
Hawaii. He holds a BA in sociology, a master’s in social work, and a juris doctorate from the William S Richardson School of Law as a member of the Hawaii State Bar Association. He practices in estate planning and serves as a guardian ad litem, making significant contributions to our community. Please welcome back our guest. Amphay Champatong,

AMPHAY:
hey guys, Aloha,

ATTILIO:
Amphay, you know, I Googled this right before you came on, people who have died without a trust. You ready? You want to hear some of you? I know you celebrities, celebrities. Name one already. You must know one Amphay

AMPHAY:
my favorite 80s Prince, Prince, Prince

ATTILIO:
died without one yes, guess what Aretha Franklin, Sonny Bono, oh, everybody knows this guy, Tupac Shakur.

AMPHAY:
And then I didn’t know that, yeah, wow. I didn’t know that died in

ATTILIO:
1996 without a will and his estate. Yeah? And then Chadwick Bosman, and people not going to recognize that name, but that was the Black Panther in the Marvel series. And then Heath Ledger, everybody knows that actor, but Oh, and then Stan Lee,

ADRIENNE:
that’s odd,

ATTILIO:
yeah, without an estate plan, wow,

ADRIENNE:
he was kind of on the older side.

ATTILIO:
Yeah. I mean, I was thinking, like, he had plenty of time to be playing, you know, if I, I was, I was coming off an airplane, and I saw Stan Lee. He was there, and he had his personal assistant, and I regret to this day not going up to him and getting his autograph, because I’m a huge fan. I think we were in the TSA line with him, yeah, and I just we, you know, snakes, right? So he was on the snake side. He was like, sneaking by. And I was like, That’s Stan Lee. And everybody’s like, that’s Stan Lee. And then I should have got his autograph done a cell phone with him. Or you should have said, Hey, have

ADRIENNE:
you done your estate plan? Yeah, I

ATTILIO:
would have said, Stan Lee. Two pieces of advice, do not buy any green bananas and get your estate planning squared away. So, but he did it, so it was a big and then, so

ADRIENNE:
let’s talk about that. Like, what is an estate plan?

ATTILIO:
We’ll talk about estate planning and all of that. But was there anything in particular you wanted to chat about before we get started? I

AMPHAY:
want to, I want to talk about the Black Panther that you brought that up. So amazing, you know, yeah, with that list that you gave me, Wow. I’m to look them up. I’m, like, very curious about what happened to Stanley’s estate, you know, and

ATTILIO:
fact, yeah, the but not only that, Amy White House, Jimmy Hendrix, Pablo Picasso, Abraham Lincoln, Bob Marley, Howard Hughes, anyway,

ADRIENNE:
the list goes on, the

ATTILIO:
list goes on.

AMPHAY:
The list goes on. So one interesting fact about the Black Panther. So he was married, and when he passed away, he did so him and his wife, they had a somewhat of a interesting relationship. And when he died, as you share it, he didn’t have any planning done so because they didn’t have any children, the state of California said, with regards to his estate, the wife would split it with the parents, with his parents, and mind you, now the wife, the parents, didn’t know that he got married to the wife. Oh, so when they divided his estate up, initially it was worth 3.8 million, so the family lost 900,000 because of all the courts legal proceedings, okay? And then the 2.3 million has to be split between the wife and his parents. Oh, wow. Imagine how the wife felt. Think about that one. Yeah.

ADRIENNE:
So how does Why did his parents not know that he got married? Were they like not speaking to each other? Or that’s that’s odd for them not to know these right?

AMPHAY:
And then now, now being the wife, if you were to assume right? And of course, I’m making assumptions, it probably deals with relationships. Now, can you imagine, though, being the spouse, and then thinking that now you’ve worked hard with your significant other in building up your wealth. Yeah? And then when your spouse dies, especially if you don’t have a relationship with your mother or father in law, and they get, you know, half of of your family, the state isn’t that crazy. Yeah.

ATTILIO:
Even little side note, diet, Princess Wales, the Princess Diana, she had a will prepared, and then she she did some additions called Letters of wishes, which were, which was a late amendment to her will. However, they were disregarded because they were not considered legal documents so completely, and they went back to the original will, which is what, not, you know, because she thought she had it amended. So talk about, talk about, Wow, talk about what people are thinking in their heads, what they want to happen. And talk about, actually, what happens when you don’t have a trust in place.

AMPHAY:
So I would actually say a proper estate plan is a more, you know, pro comprehensive. Because, yeah, yes, I mean, and this is one thing that we focus on, this will, you know, you mentioned earlier with Aretha Franklin. Aretha Franklin actually had two wills and then one being drafted by an attorney’s office, and they fought for years to see which was a valid will and it had implications. I mean, financial implications. And worst of all, similar to Princess Diana, it creates a lot of like conflict with the families. I mean, families will fight are. Says, for example, her three sons were fighting for about four to five years until they decided on which will was a valid will. Yeah. So you know, and it’s important that we do again, a proper estate plan, because at the end of the day, the goal is to have peace of mind to know that your assets, your affairs, are all in place while you’re alive and well, you have full control when you become incapacitated, where you cannot make decisions. You know you have plans in place for you and your loved ones. And then when you pass away, you know exactly who’s gonna get what, how they gonna get it, when they’re gonna get it. And now. Hence the peace of mind.

ADRIENNE:
So. So Amphay, what is the difference, though, between a will and having an estate plan? Yeah.

AMPHAY:
So this is the whole thing with Bill misconception. If you ask the general public, right, if they did their planning, it hasn’t failed me yet once. Okay? Well, first of all, when I do a workshop or presentation to the general public, I would say less than 30% when we ask about planning, would have done their plan. Okay? And then I further inquire with the 30, less than 30% that said they did the planning, and ask them, What does that mean to you? And a majority of them will say that they did their will. And what I’m going to share with you now is that A will is absolutely not enough. A will in a proper estate plan is actually something that we don’t ever have to use. It’s actually a safety net. It is not the document that you would utilize, because all wills must go through probate. And second, a will give us absolutely nothing to help you when you’re incapacitated. It really is effective when you pass away.

ATTILIO: 
So they’re like, oh, step on the oxygen line. He only has a will. It’s not good if he’s still still humming along, yeah, because that when you say estate planning, I think it’s like a truck a lot of I like to use analogies. Tony Robbins is the best at this. At the reason we use analogies for Tony Robbins is you’re trying to explain something that people don’t understand in terms that they do. So correct me? If I’m wrong, Amphi an estate planning is like chapters in a book that that address different aspects of your life, and the trust is just one chapter in that big book.

AMPHAY:
And I would say probably the biggest chapter,

ADRIENNE:
there you go, and the most important one, yeah, as well,

ATTILIO:
because all the other chapters that you talked about are the what if scenarios, what if I don’t die, I’m just incapacitated. You know, the will is not going to cover that. But the things that you have in the estate planning talk about, you know, other kind of misconceptions that people have regarding, oh, I have a plan. They think that the will is the plan. We’re

ADRIENNE:
thinking that they have a plan, yeah,

AMPHAY:
and the provisions, the setup, the designs of these estate plans are very, very important. Yeah. I mean, I’ll give you an example, and this has been prominent this year in terms of my office, the type of families are coming through, like, for example, when we think about incapacity. So incapacity is an individual’s inability to make decisions because of either a disability, an accident, cognitive impairment, like dementia, Alzheimer’s. So generally, you always rely on the general, you know, old school way of doing was always doctor decide. The problem is, you can have two doctors have two different opinions on the same question, and then who’s going to settle that? It usually involves the court, very costly, time consuming, okay? Worse yet, it’s when medical facilities actually don’t even make the decisions because they don’t want the liability, and now the family stuck. Yeah, okay, so we’ve been kind of like, going to this, and it’s just amazing, you know, I read one where the drafted documents that three doctors will decide in the jurisdiction in which the individual lived. And I’m like, you know, good luck finding one doctor to sign off, let alone three doctors to sign off to say somebody’s incapacitated, because, you know, they can already foresee all of the issues that’s going to come up, right? And litigation witness, whatever it may be, yeah,

ATTILIO:
I think the doctors are there for people to hear this and that they’re there to advise, but ultimately the family needs to make the decision. I think that’s preferential process. When you’re in that state, right? That doctors are going to prefer. We’re going to give you all the advice that you need to know. But it’s just like, you know, like cancer patients, you know, they can make a decision to live their lives out longer through chemotherapy, though it’s inevitable that it’s, it’s not going to put it in full remission, or they can just decide, You know what, I’m not going to do any of that, and my focus is just going to be to be comfortable in the in the last parts of my life. But that’s not a decision that the doctor can make for the patient. And it’s not, maybe not even something necessary. It’s not willing, yeah, and it’s me, it’s not even a decision maybe the patient, but it’s going to be the family, if given the the authority to do so, and picking the people that love you and care for you that and I think you said, Pick, you know, just and don’t put that burden just on one person, put it on a group, group of your loved ones. Yeah, yes, yeah, yes.

AMPHAY:
So it’s just, you know, and the consequences of. That. I mean, it’s just, it’s been a word, I don’t even it’s been tragic, you know, with families having to deal with the emotional toll and the grieving and the healing now, to deal with all these legalities, you know, it’s a mess. And to me, I go, the best thing is to sit with, you know, an attorney. Of course, it doesn’t have to be me or my law firm, but any attorney, and really, you know, iron out what your wishes and what your plans is going to be, and has to be customized in that way. Yeah, so, So

ADRIENNE:
Amphay, like, just, there’s so much to consider or to think about, or, like, the what if scenarios, it’s like, there’s almost like so much. It’s becomes a little overwhelming. What kind of, you know, process does your firm go through in order to just help to, you know, facilitate the plan

AMPHAY:
we’re actually make it really simple. Adrienne, I mean, when families come to sit with me, we will spend the time to actually educate the families and really walk them through the process. It’s, it’s like a road map. If you just saw the map, you look at it, you’re like, Oh, my dear. What is all of this? You know, a whole bunch of things. But as we walk through it and we talk about it, you know about what is actually going on, by the time that we’re done, a lot of you know they are, they will breathe a sign of release. They say, thank you. We’re all done. I’m like, Yes, you have some homework. However, your plan is in place. So we now really value education for our families. We want to make sure that they make well informed decisions with the advices that we provide for them, so that way now they do have that peace of mind when they are done with their planning.

ATTILIO:
I think too, what’s too important to point out, because I personally did it with you, was the updating your trust over time. Because, you know, relationships change,

ADRIENNE:
kids get older, assets changed,

ATTILIO:
you know, maybe, maybe your mindset on certain things, healthcare directives change over time, and it’s important to update them, because a lot of I always, we always in real estate, we always, we have this one saying, Keep your handwriting long because your memory is short. So you’re gonna be thinking, Oh, that’s in the in the trust, and then you go back and like, Oh, that’s not in the chat. Oh, I gotta update it. How many? Yeah, how often? Go ahead, Adrienne with the question, yeah, how often

ADRIENNE:
Amphay Are you? Do you recommend to make those updates or to review, or

ATTILIO:
what triggers? What triggers?

AMPHAY:
So I would say review is optimal to look at your plan what’s every three to five years. And if there are nothing to update, then you let it be, because it will be, you know, it it’s reliable. It’s just, so I would say, every three to five years, review your planning, and if no changes need to be made, then we let it be, yeah, what we do at my firm is we do, you know, in the event that say there is changes in the law as an example, and notify our families if their plans need to be updated. For the most part, it’s really for them. You know, one more thing I wanted to add to that, Tilly, when you talk about, you know, real estate, and I go, one of the things that I let families know is, when you create a trust, your trust is, is kind of like, you know, think of it as a bucket, yeah? So as you now acquire more, like, say, you acquire more property, you acquire more assets, you acquire more wealth for your family, then you would just put these assets and properties into your bucket. Yeah, it’s actually being used. And those things really don’t need, you know, an attorney, to up people documents. You can just put these assets in there.

ADRIENNE:
So when you say, when you say, put them in there, that means, like, put the title of the property into the in the trust, correct. Or, if the property is owned in an LLC, the owners of the LLC needs to be the trust,

AMPHAY:
correct? Yep. So when you have ownership interest, yeah, when you open up, say, an investment account, you know, or you you buy CDs, or you get crypto or whatever it may be, yeah, all of these things will go into your trust. And then you would provide instructions, yeah, to your trustees.

ADRIENNE:
What happens if you forget to put it in the trust. Is there some what do you call it like, a pour over or over will? Can you explain how that works? What is that you forget? Yeah, one of those accounts.

AMPHAY:
So that actually circles back to when we when we first started this morning, you know, regarding the the will and I shared with you right in a. Proper estate plan. A will is actually a safety net. A will is not the instrument we want to use for our for our planning. So in the event now you forget to put something into your bucket, meaning funding it like, say, for example, a property, or that property, you’re in the midst of acquiring that property, and something tragic happens, and that property never went into the trust. That property, that acid now must go to probate. Okay, okay. If it goes to probate, the will is actually a poor over will, instead of a last will and testament. Now, this poor over will be provided to the court. It’s going to instruct the courts judge that property, that asset, that I did not put in trust, go ahead and pour it over into the trust, making the trust now the beneficiary. That’s why it’s a safety net. We still have to go to probate because it was in now, however, it says, Put everything into the trust and allow my trustees to administer through the trust. So

ADRIENNE:
it’s like, is it like a mini it’s like a mini probate kind of thing, versus, like, if you had no estate plan and no will, which would have been, like, that’s a lot more extensive. Or is it the same amount

AMPHAY:
of the court it actually, it does have to go to probate. However, the instructions are clear as to who now is the heirs. It would basically, it’s going to go into trust,

ADRIENNE:
so it still has to do the probate, but, like, it’s a lot better than just going into probate with no instructions. Yeah,

AMPHAY:
right, because then the laws intestacy, we call it a test C, where you don’t have anything in place now, that rule now will apply. It goes back to like the Black Panther as as an example, with Chad mcin When he passed away. So the state of California rule says that if you die, if you if you’re married, and you pass away and you don’t have any children, your estate now will be split between your spouse and your parents.

ADRIENNE:
And that’s just a California law, right? That’s just California also in Hawaii ago. Oh, okay, all different. Okay, yeah,

AMPHAY:
so Hawaii has a similar law. The numbers may be different, yeah, it’s similar in that if you’re married, you don’t do your planning. You you and your spouse. If you pass away, your spouse now will get a percentage of money amount, and then now the remainder of the asset will be split three, three fourths to 1/4 which means what it’s going to be?

ADRIENNE:
What if you’re What if the parents are no longer around? What if they’ve passed away? Will just go 100% to the spouse

AMPHAY:
Correct. Okay, there’s all these different rules, like I said, and it gets funky as now, so the law will do its best to kind of guess at what you want to see happen. Yeah, the more that changes, especially when you look at what nuclear families are like now. If I asked you today versus 40 years ago, what is a family, right? 40 years ago would probably be husband, wife, children, right? Nowadays, you know, given the, you know, statistics in terms of how, you know, families are so much more blended now, right? It’s more more that you see blended family than you see nucleus, like just a, you know, traditional family, right? Well,

ATTILIO:
today’s family is a group of Homo sapiens with no personal pronouns. That’ll be the most liberal description of it. Interesting here. You know another misconception people have is like wealthy people, billionaires, they’re so smart, they got all these attorneys. Howard Hughes. Anybody heard of Howard Hughes? Howard Hughes is development company, by the way, that’s building all those luxury high rises in Kakaako. Yeah, still exists today. He has no will. He was worthy $2.5 billion they had over 1000 heirs come out of the woodworks, and they settled with 200 of them. Guess how long it took? MP, if you had to guess, guess how long all of this took?

AMPHAY:
Let’s see, eight years. Close, 34

what? 34 years? 34 years.

ATTILIO:
Because it’s just, I mean, so you’d be surprised. So Young, old, smart, plenty money, no more money. But if you got assets, be smarter than Howard Hughes, be smart. You know what? Be smart and Be smarter than a billionaire. Give

ADRIENNE:
call Amphay. Yeah, give Amphay a call. He’ll help you get started on it. He makes it very easy, stress free. Attilio and I have both done our plans with with Amphay, and it’s, it’s not,

ATTILIO:
you know, when I step off the curb, I still look twice, but I am not really paying attention to busses anymore. I know they’re there, but I’m not so hyper aware of them. Am, yeah.

ADRIENNE:
So Amphay, we are coming towards the end of the show. So if there’s any last minute thoughts that you want to share with our listeners before we let you go, one thought,

AMPHAY:
I’m stuck at 34 years.

ADRIENNE:
Yeah, shocked, yeah.

AMPHAY:
I’m still shocked, you know, and the worst part of it all is the families have to wait, yeah. But imagine if it wasn’t used it was your, you know, again, your typical family. See, even if you have young children, your children have to wait, yeah. And if you sort of take 34 years, what happens then? And I know, you know, in my office, we, were here, you know, this is what we do, and I will share with you on a daily basis, like the stories that come. I mean, we were not able to make these up, you know. And it’s a daily life having, and it’s, it’s horrible for the families. And I can’t say enough about, you know, everybody needs to do their planning. Yes, you know, if you have a home, if you have property again, if you’re married, you have a splendid family, you have special needs loved ones. If you own a business, you have to look at doing your planning, whatever that level of planning is. Hey,

ATTILIO:
you know, let’s be real, folks. We’re all leaving this planet the exact same way. No one’s got no one’s getting out of it. So have an estate plan put together to take care of your loved ones,

ADRIENNE:
and we recommend Amphay he’s the best. Yes, he’s our he is our expert we trust, and he’s Yep, and he’s done a great job for both myself and Attilio and some of our team members as well. All

ATTILIO:
right. Well, thank you. Amphay,

ADRIENNE:
thank you Amphay,

AMPHAY:
thank you guys. Oh, thank you for that wonderful list. Attilio, I have to look up Stanley,

ATTILIO:
yeah, Abraham Lincoln, 16th president. He was an attorney. He didn’t have a will. So amazing. But hey, life happens. It’s not a plan. Death is not a plan, but your state can be a plan. That’s right, yeah. All righty, thank

AMPHAY:
you. Amphay Thank you. Thank you.

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