Estate Planning Blog Articles

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How to Protect Wealth over Generations

The Gilded Age was a time of rapid economic growth, creating extraordinary new wealth, materialistic excess, political corruption and terrible poverty and struggle for the lower economic classes. Famous families from this era, including the Rockefellers, Carnegies, Vanderbilts and Astors, had huge wealth. Nevertheless, not all benefited from multi-generational estate planning, says the article “Estate Planning to Protect Generational Wealth Transfers: Lessons From The Gilded Age” from mondaq.

The Vanderbilt family’s wealth came from shipping and railroad empires. In 1877, the family’s wealth was estimated at $200 million—$105 billion in today’s value. The family name continues, but with every generation, the size of the wealth dwindles. While the exact terms of the Vanderbilt estate plan are unknown, it’s understood that the family had no strategic long-term plan.

The Pulitzer family is best known for the Pulitzer Prize and the founding of the Columbia Journalism School. Two generations after Joseph Pulitzer’s death, a grandson lost most of the massive fortune in a single bad investment. Without a multi-generational plan for wealth transfer, the fortune evaporated.

The Rockefellers are known as one of the Gilded Age families that got estate planning right. They used irrevocable trusts to protect assets from wasteful spending by heirs over multiple generations. The Rockefellers created business succession plans and incorporated philanthropic goals that are still used today.

Your family can benefit from trust and estate plans, even if you’re not worth $100 billion. Creating a strategic plan to protect and transfer wealth over many generations can happen with the skilled experience of an estate planning attorney. Teaching financial literacy and shared family values, including understanding the importance of stewarding wealth and philanthropy, is as important as the money itself.

Generation-skipping trusts (GSTs) are just one means of preserving wealth transfer. With a GTS, a grandparent can leave assets in the trust to grandchildren and other beneficiaries at least 37.5 years younger. By skipping a generation, federal estate taxes aren’t paid twice on inherited assets. Trusts have also been used to offer creditor protection for generations. Divorcing parties can’t access funds in a trust.

If appropriate, there are some states where perpetual trusts are permitted. An estate planning attorney will be able to make recommendations as to whether these are appropriate for your family.

Selecting trustees and successor trustees is extremely important for wealth to last over many generations. Your estate planning attorney will also guide you in choosing either individuals or institutions to ensure trustee power is in the right hands.

Reference: mondaq (June 18, 2024) “Estate Planning to Protect Generational Wealth Transfers: Lessons From The Gilded Age”

Why Is Family of a Texas Governor Fighting over His Estate?

Dolph Briscoe Jr. was a Texas rancher and businessman and was the 41st Governor of Texas between 1973 and 1979. His oldest child, Janey Briscoe Marmion, established the foundation with her father to honor her only child, Kate, who died in 2008 at the age of 20.

The Uvalde Leader-News’ recent article entitled “Briscoe family lawsuit targets Marmion’s will” reports that Marmion’s original will filed in 2011 directed her assets to be placed in a revocable trust.

The foundation was to have received income from half of her wealth for 22 years. The rest was directed to the children of her brother Chip Briscoe and those of her sister Cele Carpenter of Dallas.

However, a second will executed by Marmion in 2014 and admitted to probate in the County Court in December 2018— a month and a day after her death—calls for three trusts, including two child’s trusts created by her father and a generation-skipping trust (GST). A GST is a type of trust agreement in which the contributed assets are transferred to the grantor’s grandchildren, “skipping” the next generation (the grantor’s children).

Marmion created the Janey Marmion Briscoe GST Trust, dated November 1, 2012, in which she gave a third of her assets to the foundation and the other two-thirds to be divided equally between Chip Briscoe’s sons.

Carpenter’s three children filed suit in Dallas and in Uvalde County last year challenging the validity of the 2014 will and contesting the probate.

Their complaint alleges that Marmion intended to include the three as beneficiaries, in addition to Chip’s two sons, and that the situation creates a disproportionate inheritance in favor of the Briscoe men.

The amount in question is more than $500 million, since the former Texas governor’s estate was estimated by Forbes to be worth as much as $1.3 billion in 2015. Governor Briscoe died in Uvalde in 2010 at the age of 87.

Reference: Uvalde (TX) Leader-News (March 11, 2021) “Briscoe family lawsuit targets Marmion’s will”

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