Protecting Your Legacy: Why a Will Isn’t Enough

In this episode of Market Talk, Natalie Picha, Partner and Chief Experience Officer at RHP Wealth Management, is joined by Kim Hegwood, Managing Attorney at Your Legacy Legal Care in Houston, Texas, to unpack one of the most important—and often overlooked—aspects of financial planning: protecting your legacy.
 
Together, they go beyond wills to explore the real risks families face without proper planning, including incapacity, guardianship, and family conflict. From trusts and power of attorney to special needs planning and blended families, this conversation delivers practical guidance to help you make confident, informed decisions.
 
If you’ve ever thought, “I’ll get to that later,” this episode will show you why later might be too late—and what steps you can take today to protect the people you care about most.

Experience the difference of working with a firm that empowers your life—a firm that focuses on what matters most—you.

Whether you are beginning your financial journey now or have already taken steps toward your ultimate life goals, we are here to guide you.

https://podcasts.apple.com/us/podcast/rhp-market-talk/id1538051530

Transcript

Why Legacy Protection Matters

Natalie Picha 0:09

Hi everyone, I'm Natalie Picha, Chief Experienced Officer and Partner at Royal Harbor Partners Wealth Management, and this is Market Talk. In this episode, we're diving into one of the most important and often overlooked parts of financial planning, protecting your legacy. I'm joined today by Kim Hegwood, managing attorney at Your Legacy Legal Care and host of the Life Happens Podcast to talk about estate planning, wills, trusts, guardianship, and how to prepare better for a crisis. Our goal today is to empower you with practical knowledge so you can make informed, confident decisions for yourself and your family. Kim is an elder law and estate planning attorney based in Houston, Texas. She's been practicing since she graduated from South Texas College of Law in 1996. After watching her grandparents struggle to maintain their independence as they grew older, trying to navigate the challenges of aging and deal with legal, financial, and emotional challenges that our loved ones face in their golden years, Kim dedicated her career to educating and helping families preserve their dignity and protect their assets. Kim's practice focuses exclusively on elder law, asset protection, estate planning, Medicaid crisis planning, probate, and guardianship. Kim is a certified dementia practitioner and a member of the National Academy of Elder Law attorneys. We hope you enjoy today's discussion and you walk away with a practical next step to protect your own legacy. Well, good afternoon, Kim. Thank you so much for joining me today. And I appreciate you having me on your show. I'm looking forward to it. Oh, I think this is going to be a great conversation. Before we just jump right in, tell me a little bit about your personal experience and how it led you to form your legacy legal care.

Kim Hegwood 2:01

So I've been practicing for about you know 28 years now. Feels like yes, duty. And um, and so a lot changed over the over time, I think. I got out of law school, and when I got out of law school, I litigated the first about first eight years of my practice. Um, I also did wills and probate and guardianship, but I did a lot of litigation. About two-thirds into that 10 years, uh, my grandparents started declining. And uh and I knew from a very early age that I was going to be the one that was going to take care of them. It's wild because it was never really talked about. You just knew, you know, and um I tell people at 18, she hauled me down to the bank, put me on everything, you know, and I'm like, okay, I'm a little uncomfortable, but okay. At 18, this is my grandmother. Yeah, grandmother, she uh went down and they put me on everything. But I was, you know, it was a long time later when before they started to decline, but they were like my second parents. Um, I talked to her every day. And if I didn't call her every day, she called me to complain that I didn't call her every day, you know. But um, around 2004, she really started to decline. So my grandfather stopped taking stopped working, and he was in his late 70s, and he really liked what he was doing too, and uh to take care of her, and he wasn't taking care of himself, so he had his first stroke. And so, you know, while he wouldn't let me do a lot until then, at that point in time, I kind of stepped in and took control, hired the caregivers, you know, to take care of her while he was rehabilitating. When he retired, he'd cobra his his health insurance for 18 months, but he forgot to add her to part B after that 18 months. So he was getting all these outrageous medical bills. And I'm like, so I said, give me your Medicare card, let me see what's wrong. Sure enough, no part B. So I'm on the phone with Social Security, you know. So my grandparents had a longtime attorney that took care of them, and all they had were wills, nothing else. Silly me. I run down and get power of attorneys, I draft power of attorneys for them, knowing they need that stuff. Right. And my grandfather looked at it and he slid it across the table and he said, I can't sign that, you know, and he stomped off like I had offended him. My grandmother looked at me and she says, Um, she says, Kimmy, if he can't sign them, I can't sign them either, right? Old school. And uh, I said, just look at them, you know, and then I'll talk to you about them. I'll talk to you why they're important. But because their attorney didn't give it to them, they didn't think they needed it because they trusted him. They went to him for real. If they had a problem, they went to him. And so, and I was while I was a very good practicing attorney, I was You were still the granddaughter. I was still the granddaughter that ran naked through the house as a toddler, you know. So they had a hard time, they had a hard time getting past that, I think, at some point in time. So we he managed to recover from the first stroke, and then he had the second one. So now we had caregivers during the day, we had caregivers at night, we had caregivers on the weekend. So I'm hiring, firing, threatening, because I had a couple of them that stole from them, you know. Just, I mean, it was, and I was litigating. My kids were teenagers at the time. So I had three teenagers that were mine, I had custody of another teenager. So I told people I had four teenagers, two dogs, two cats. I was litigating, running back and forth from Houston to Galveston and making sure the grandparents were taken care of. They passed away in 05 and 06. And in 08, I was sitting at my conference room table and I found myself rising out of the chair to slap my client on the other side of the table. And I sat back down. You know, I didn't rise very far when I snapped, and you know, when the thought hit me, and I sat back down and went, I'm I can't do this anymore. You know, I'm not happy, I'm done. So I stopped litigating and um and I'm sitting in my office going, and Lorraine, who had been with me, she's still with me back then, goes, Oh my God, what are we going to do? Right. She's thinking, I'm not going to get a paycheck, you know.

Natalie Picha 6:00

Right, right, right.

Kim Hegwood 6:02

And so I told her, I said, I don't know, but we're just going to pray about it. God's going to take care of it some way or another, you know. And so, and about a week or so later, a little postcard came in the mail. It says, Hey, if you're not happy with what you're doing, what type of plan, you know, law you're doing, do you want to learn to do estate planning? And I looked at it and went, Oh, thank God. You know, and so so then I got some very good training on doing a lot more in-depth estate planning. So we learned about, you know, doing trust planning and all of that kind of stuff. And then I got involved with a bunch of other groups and I did learn to Medicaid crisis planning and you know, very advanced uh estate planning, you know, type things. And so, and it just kind of rolled from there. And the beautiful part about doing elder law, and I tell everybody this I miss my grandparents. Hanging out with other people's grandparents makes my day.

Natalie Picha 6:53

Oh, and so that's wonderful.

Kim Hegwood 6:55

I love my seniors, you know. When you think about, you know, people that were raised, you know, because I'm like right at the end of the baby boomer kind of generation. We were raised to be very respectful, you know, you treat people very well, you know, and so it's a different mindset than what I think the younger generations, you know, that have been that are coming up have were raised. And maybe it's just me, maybe God has just blessed me immensely. But I have great clients. I have great people, you know, that come into my office to do planning, you know, and we, you know, we work with them to do the things that is important for their family. And I honestly think my litigation background comes in really handy because I can spot those family issues real fast.

Natalie Picha 7:41

Yeah.

Kim Hegwood 7:42

You you see them coming, they're like red flags that just kind of blink me on. And so I think it makes me a better planner, you know, in that regard, you know. But I love what I do. I can spend all day hanging out with great people, have a lot of fun. I think I'm funny, so I'm pretty much a little jokester. So we we try to make sure that you know that the clients were comfortable when they come in. I gave away all my suits when I hit my 20 years in practice, gave them all away. And uh there's a great organization called Dress for Success. They got 37 suits of mine. Wow. And uh when you have different sizes as you get older, and you know, you get a whole bunch of them.

Natalie Picha 8:22

Yeah, you had a great it was a great donation opportunity there.

Kim Hegwood 8:25

It was a great donation. So we did it as kind of a fundraiser type thing and encouraged all our clients to bring any of their stuff in. So they picked up a lot of stuff from my office that year. That's very funny. So that was a lot of fun. So it just it's progressed. I tell people, God has driven my practice, honestly, in the way he's wanted it to go, because things have just kind of fallen into place. You ask, and you know, and then it's just kind of happened. So it's it's been it's been a good ride. I'm enjoying it.

Documents That Matter Before Death

Natalie Picha 8:53

Well, that I mean, that is really exciting. And I I feel very, very much the way you do is that we have some amazing clients, and I love the opportunity to just get to hang out with them. And everybody's story is so unique, everybody's situation is so different. So you're always trying to figure out, you know, the best way to navigate whatever's going on in someone's life. So tell me a little bit about, I think when we think of estate, just estate planning in general, we just think of, well, someone needs to make sure they have a will. But you just pointed out your your grandparents had a will, but they didn't have anything else. And you and I recently had a conversation about doing planning way before death. I also think that it's it's interesting you were mentioning being a little jokester and being funny. You know, part of what comes with the territory of being an estate attorney or a financial planner is getting really comfortable talking about dying, talking about end of life, talking about the fact that at some point you will likely be incapacitated and someone else will need to be making decisions on your behalf. And when you're gone, you want someone you can really trust that's going to take what you hope, you know, your legacy will be and follow through with that. So just talk a little bit about a will is great, but what else should you be thinking about?

Kim Hegwood 10:10

So with my grandparents, they had the will. They needed, um, my grandmother never signed her documents. My grandfather did after he had his first stroke. I I sat down and gave him his what I commonly call his come to Jesus speech. Right. And uh I said, I'm in the hospital room sitting beside him, going, listen here, old man, let me explain to you how things work. I said, I'm not the one that's going to be making medical decisions for you if you don't sign that medical power of attorney. I said, it's going to be in my mom and her two sisters. He goes, What? I said, Yeah, that I'm I said, I'm the granddaughter. I'm low man on the totem pole in the hierarchy of things. And I'm not even the oldest granddaughter, you know, so there's a bunch of us. And um, I said, So you have to understand that I can't do things. You know, I can't make those medical decisions because until you sign that document. I said, as far as finances, while I can handle some of the finances, you know, because I'm on some of the accounts, I can't take care of everything because you didn't sign that statutory durable power of attorney that allows me to handle all of the finances.

Natalie Picha 11:13

Right.

Kim Hegwood 11:14

And so, you know, with that goes a HIPAA authorization so that I could access his medical records because I was with him with every medical appointment I took him. And so I adjusted my schedule. Thank God I was, you know, I worked for myself because I don't know if I could have done it otherwise, you know, because I adjusted my schedule so that I wasn't in court the days they had doctor appointments and things like that. Right, right. You know, so but that hip authorization that allows me to access his medical records, you know, he signed the directive that said, hey, if I'm terminal or incapacitated, how do I want to be taken care of? Now we've added designation of guardians, you know, for clients, for them, not minor children, for them, because now we have kids that will fight over how mom and dad are taking getting taken care of.

Natalie Picha 12:00

Right.

Kim Hegwood 12:00

And always laugh. And it's usually the child that's not doing the caregiving that complains the most. And you know, it's just the irony, I know. And so, um, but those those documents that go with your will are are so important because when you plan, we plan for incapacity way more than we plan for death. Death is easy. It's that incapacitated state that you have to plan for to make sure that the bills are getting paid, the care that you want is getting taken care of, that they have the ability and access to funds to hire caregivers or, you know, do the things that you want to do. You know, so we talk to clients about what's the plan? You know, how do you use vision things? A lot of clients are like, I want to stay at home. Well, how are you going to do that? You know, where's the money? Hop has access to the money. So there's a lot of things that go along with planning, and it's just a matter of having a conversation because you have to start there by having that conversation.

Natalie Picha 12:57

So let's talk a little bit about privacy and control. You were talking a little bit about so I have a lot of clients that especially after the first spouse passes away, we start feeling concerned that we only have one individual on the accounts, you know, and then there could something could happen. But we will have clients that will say, I'm not ready for anyone to know what's going on in my accounts. I don't want them to see anything. This is about privacy, right? And control. How do you handle that situation when you're kind of met with that objection?

Kim Hegwood 13:31

So most of the time it's a matter of usually your power of attorney agents can um can access those accounts when they need to. So a lot of times having that power of attorney, um, some of your people that have their their money in in certain entities, they have their own power of attorney, you know, that they use. So you have to make sure that you sign that one. And I know most of which those are, you know, so we always ask, you know, do they have their own? Because you need to know that. You also, in the in the financial power of attorney, can decide if you want someone to access your stuff now, you know, at any time or only upon incapacity. And I tell clients, incapacity is going to be very difficult if you make that choice because you've got to have a doctor to put in writing that you're in, you can't handle your finances before that agent can use that power of attorney. It's not a fast process. Doctors don't like to put stuff in writing. So not only do you have to get mom or dad to a doctor that's willing to test her and then write the letter that says she can't handle her finances or he can't handle his finances anymore, it's a lengthy process. And if you've got to wait, it's a problem. The big thing I tell clients all the time is if you don't trust the person that you put on that document implicitly, don't put them on the document.

Natalie Picha 14:46

Right. I would also say that we're seeing, and I mean, we're seeing it within our own clients, is that early onset dementia, all the way up to full-blown Alzheimer's, and we experience this in our own family, can also cause uh, you know, individuals to be very paranoid. And so it may be time for them to have help, but they are going to refuse that help at every, it feels like at every turn. So I think to your point that getting to that place where everyone realizes, oh, we are we're at incapacity, oh, now we've got to go get a doctor, actually put that in writing, or admitting it is is sometimes a really hard place to be.

Wills Versus Trusts And Probate

Kim Hegwood 15:29

Most people won't. Most people that are in that have they're past the early stages of being diagnosed, um, you know, they're mid to full-blown, you know, dementia. They have no idea. And they and a lot of them will deny it. And ironically enough, I see it more in men than women. And um, and so, but that doesn't really surprise me because you know, men of that generation don't like to admit any weakness anyway. And you look in a lot of people look at that as kind of a weakness to not be able to remember things and things like that. So um that's why it's important to plan prior to needing that stuff. So, you know, clients that we know that have been early diagnosed with dementia, you know, we get them to do their documents and then I get them to update their documents every year until they can't anymore. So we we visit with them, we touch basically to make sure the doctors are on board because that last document that they sign is the one they have to live with. You know, so that financial power of attorney, if it's really old, a lot of financial institutions won't take them. So having them approved ahead of time, you know, here's it is, it's all been signed in the lawyer's office, everything's good, it makes life easier for that person needing to use it down the road.

Natalie Picha 16:42

I know you also do a lot of trust work and you advocate for, okay, we can do a will, we'll will's great, but let's let's get all of this stuff kind of all figured out way ahead of time. Like you said, death is kind of easy. It's the beforehand, right? So can you talk a little bit about what you think of when you talk about doing trust planning for uh, you know, say a couple, an individual, maybe even specifically, because I know it gets super complicated when you start talking about blended families and making sure that those things are all set up. And then I think something we have to explain to clients quite often is the difference between an irrevocable or a revocable trust and what that means. So can you just speak to that a little bit and how you got how you because I what I find too is working with a lot of us state attorneys like we do, everyone approaches it all a little bit different.

Kim Hegwood 17:33

So I'm going to start back to your first thing and then we'll work our way forward. Okay. So everything depends on the client, the family member, where the money is, how much money they have, who's getting it, things like that. So when you sit down with the client, you really have to know what their goals are. You know, what's important to them. I had a client come in, and I've had more than one client come in and I say, All right, well, how much fun do you want to have today? Right. And uh, you know, what do you want to do? And they're like, How much fun I want to make sure that the in-law doesn't get anything done. I know how to do that. Anything, any, you know, do you have more requests? Because we can do this. And so, and a lot just depends. You know, when you've got, you know, whether you do wills versus trust, a lot of times depend on when you're an individual, depends on your beneficiaries, it depends on their ages, it depends on uh how many beneficiaries, possibly who they are, how you want them to get it, you know, because when you do will-based planning, you know, truly the only thing that passes through a will is real estate, oil and gas mineral rights. Everything else you have in life has a beneficiary designation. But creditors get paid in probate. So, you know, so that's a given. We have to notify them in writing. I mean, it's you know, it's out there in trust planning, it's all very private, you know. So if you're going to leave a decent amount of money to a child or something, you don't necessarily want their future spouses to know, hey, this is hey, I should marry this person because their family left them money because it's now public record. If you know, and I've had a back early in my practice, not so much now, but I had a lot of the older attorneys that would just tell people they do wills for them and they say, just make your estate the beneficiary. So then everything passes through the will into a trust. And you're like, oh my God, no, you don't want to do that because here's all the reasons why. You know exactly.

Natalie Picha 19:28

There's so many reasons to not do that. We still encounter that pretty frequently, and we have to ask people, no, no, no, can we set a meeting with your attorney and let's go back and talk about that? Because they just want to put their estate as the beneficiary of whatever it is, right? And we're like, no, no, no, don't do it.

Kim Hegwood 19:44

Yeah, no, no, no. We chose we, you know, we we have I have a nice probate practice, you know, but I like to think it's not my clients, it's other people's clients. And um, you know, because we go, we we work very hard at trying to, you know, there's only so much you can do to help a client fund a trust. You know, they have to do, they have to do their part, you know. So, you know, sometimes it happens, but it's not by choice, you know. I mean, it's not by our choice anyway. You know, when married people come in, one of the things that I like about trust planning is I can put remarriage provisions in there. And and I love the remarriage provision, you know, it's in there that just says, hey, if somebody passes away and this person remarries, they need to, before they get married, they need to have a prenup in place to protect the deceased half of the estate. So it makes sure it goes to the children. You know, one of the things that has caused more conflict with families probably is the mom or dad passes, the survivor remarries, they usually marry somebody younger and they're living in the house. And the kids can't do anything with the house, they might be responsible for putting a new roof on it, but they can't kick her out because they have a statutory right to live in the house that they have to rave in the prenup. I'm a huge fan of prenups, you know. So it limits, you know, how long does that second spouse can stay in the house, you know, three, six. I think a year is the longest I've ever drafted one. And I kind of I really argued with them over that one. I thought a year was a long time because it just puts things, you it puts the estate in limbo, you know. So you you have to really reach down and figure out what the client goals are in that aspect of it. Now you talk about blended families. We always tell a blended family to do trust planning. It is so easy to disinherit children doing will-based planning. Because as soon as you give that spouse the beneficiary, you make them the beneficiary, and it all goes to that spouse, right? They can redo their estate plan, change all the beneficiaries to their kids. And if you passed first, your kids won't get a dime.

Natalie Picha 21:40

Yeah.

Kim Hegwood 21:40

And so, and while people say, Oh, I love them, trust them, I'm like, that's great on paper, but it doesn't work in real life 99% of the time, because you know, there's usually something that happens. I I went to a funeral and I barely missed a fist fight. And I was like, man, I hate being late. You know, so so it's a lot of kids will tolerate stepparents, you know, probably more stepmoms than stepdads. I think they will tolerate them while their parent is alive, but they have a tendency to get real ugly when they're done when they're gone, you know. And so and you just there's no way to know, you know, some people do really well with stepparents, a lot of people don't. So it's really a matter of planning. Always plan for your worst case scenario. Let's assume that everything's going to go badly and let's plan for that and then work our way back. Because if you do that, I have put together an excellent plan for you because we've covered a lot of the bases that you could possibly encounter. And for me, that's a better plan.

Natalie Picha 22:40

Oh now family dynamics are a thing. I I, you know, we deal with it on a very regular basis.

Irrevocable Trusts And Medicaid Planning

Kim Hegwood 22:46

Wait, you want to talk about irrevocable trust? So let me Oh, yeah,

Speaker 22:49

yeah, yeah. Yeah, let's forget that. So we so we do a lot of irrevocable trust planning. Uh, one of our most favorite trusts is we have an income-only irrevocable trust that we use a lot. Um, we use it for clients that are looking to protect assets from long-term care because you got to beat that five-year look back period for Medicaid. We do it for clients that are looking just for asset protection, maybe they're doctors, lawyers, nurses, whatever, you know, somebody that's got a target on their back as soon as they got licensed. And um, you know, so and a lot of people just, you know, they like the ability to just kind of put it away and, you know, and be okay with it. And we put some provisions in that trust. You know, it's it's one of those trusts that you don't have to file a separate tax return for, you know, so we like that. You don't have to do a lot of extra stuff for it. And then we put some little extra provisions in our trust that allow them to change the trustees, change how the beneficiaries get it just in case the kid goes off the rails down the road. Right. Um, and then maybe change their disability panel if that's how they decided their incapacity is going to be determined. So we give them some provisions in there that gives them a little flexibility that covers the big things that you might want to change in a trust, even though it's irrevocable. And so we do a lot of gifting trust, uh, we do a lot of retirement trust. Retirement trusts are great for second marriages because I can make the spouse the primary beneficiary of that trust where all they get is required minimum distributions during their lifetime, and then the kids get the remainder. So yeah, but the kids still have something down the road. It's a wonderful thing for second marriages. We I kept thinking when the Secure Act came, I'm like, man, what am I going to do with this retirement trust? They we don't have the stretch anymore, and that's why we did them all the time. I don't know, for some reason the light bulb went off, and I was like, oh my God, second marriages, it's perfect for them, you know, because then you can take care of the spouse and the kids with one instrument when you know, because we have a lot of clients that have large retirements, yes, you know, and once you make that spouse the beneficiary, it's theirs.

Natalie Picha 24:46

It's all of it, right?

Kim Hegwood 24:47

Yeah, it's always great to have clients that are that come in to put to the meetings and you you give them this plan and they know they're this the second spouse, and they're like, you know what, that's a great plan. You know, I'm I'll be okay during my lifetime when the kids, his kids get it or her kids get it when she's gone, it's a great plan, you know. So that really works as well too.

Natalie Picha 25:07

That's excellent. That's excellent. So I think one of the things that people forget, you've got the irrevocable and the revocable and the tax treatment of those two different, those different things. So you just mentioned it with the revocable trust. You have that option of it doesn't require an additional ENT number, you know, it's basically it's basically under your own social security number and it provides a tremendous amount of flexibility.

Kim Hegwood 25:31

Yeah. While you're both, if you're married, while you're both live and well and competent, yes. If you in our trust, when one person passes, the family trust becomes irrevocable. We do the split because we want the asset protection when the second when the first spouse passes, you know, and even all our income-only irrevocable trusts, you still use your social security number and um until until you're gone. So because we make them, I tell clients, we make them defective on purpose. So it's I'm like, we we did it on purpose. It works really well. I really like it, you know, for clients that like that kind of flexibility.

Guardianship Costs And Court Control

Natalie Picha 26:08

So I want to circle back to something that you mentioned earlier, which was guardianship and working through guardianship pieces. We actually have quite a few clients that have either children, adult children, special needs adult children that they're working with. But I also know that there are those out there that at some point guardianship makes more sense than just being a power of attorney. Talk a little bit about what you guys do on the guardianship side.

Kim Hegwood 26:36

So with the guardianship, the courts, if you have a power of attorney that works, you won't get a guardianship. Okay. And so you people that fall under guardianships usually are people that don't have power of attorneys, the medical and the statutory durable power of attorneys. So I sell up the medical and the financial. Um, they maybe they were never didn't have capacity, you know, so they were 18 and still no capacity. So now they're in guardianship. Um, and so and guardianship can be it can be a blessing and a curse. So it gives parents or someone the ability to make decisions for them, whether it's medical, where they live, things like that. But then you have things like if you're guardian of the estate, then you've got to do annual accountings and they have to be approved by the court. And they're making it really difficult for attorneys in this practice because they're expecting us to work for free, get all the work done, and then request to get paid from the court afterwards. Oh, so you're going to find attorneys that are going to do less of that because we have people I have I have team members I have to pay. Right, right. This is yeah, you can't work for free. And some of it, some of it takes there's a probate court in Harris County, they're three and four months behind approving annual accountings. Oh my goodness. So, oh, it's ugly. And um, so yeah, and uh so it makes it really difficult to you have to understand with the guardianship. Not only do you have to request the court's permission for everything you do, but you got to request a monthly allowance, you know. So when you have when you're guardian of the estate, you have to ask the court, hey, can I spend this much money each month and this is what I'm going to spend it on. You can't go over, you can go under, but you can't go over. If you go over, you got to go back to the court and say, Hey, can we increase my monthly allowance? Every time you do that, you have to have an attorney do that.

Natalie Picha 28:31

That's not practical. That's not practical.

Kim Hegwood 28:33

Oh my god, it's very expensive. I tell clients, you avoid guardianship as much as possible. You know, you might spend a thousand dollars doing power of attorneys, but you walk in to do a guardianship, you know, and I don't know about other people in my office, you're going to pay anywhere from four to five thousand dollars right off the front, right off the front, and you probably will spend about $7,500 to $10,000 by the time that first year is over, because there's so much that has to you have to kind of set up and put in place and then do accountings. And people are not necessarily really good at hanging on to all their receipts, and you know, because you got to hang on to receipts. And I mean, it's it's work, it's work to do being a guardian of the estate. And I tell clients it's so much cheaper to do good planning, you know, and so and as you get older, you want an elder law attorney to draft your your power of attorneys because in ours, we have all the extra bells and whistles that you need for long-term care. Yeah. And so we put the extra stuff in ours. And um, and so and and we've implemented we've implemented changes in ours that have, you know, as we've run across things that have come up, we add more to our power of attorneys to make sure that our clients don't have problems as they age because you you don't want to. You don't want to have problems. You're already aging and not liking that part of it. The last thing you want to do is have problems trying to get taken care of in the process.

Natalie Picha 29:51

Right, right. So, how does that, what is, how does that differ? We were talking about guardianship, but when we talk about special needs and special needs trust.

Kim Hegwood 29:58

So I like special, I mean, special needs trusts are great. Uh, we have a lot of clients that have children with disabilities. I have a child that has a disability, you know. So the beautiful thing about special needs trust is you can put a million dollars in that special needs trust and they're still going to get all their benefits.

Natalie Picha 30:14

Right.

Kim Hegwood 30:14

Because it's designed to be able to put money in that trust to make sure that your child is taken care of for as long as you can make that money last, that they're going to be okay. And with our special needs trust, we put in care manager provisions, trustee. If you're not looking at my kid at least once a month, then you have to hire somebody to go out and look at my kid once a month. Because I want to know that my child is happy and healthy and they're clean and they're in a good environment. You know, I mean, you just as a parent, you want to know your kid's okay. Right. And some children, you know, they may not be have the ability to, you know, to pick up the phone and say, mom, a trustee's not taking care of me, you know, because you know, I'm lacking X, Y, and Z. You know, so you want to make sure that somebody's looking at them, somebody's taking care of them, somebody's getting them all the benefits that they're entitled to, and the trust comes in as extra when all possible. You know, so it's it's such a good plan. And I tell people, if you have a child with a disability, set that special needs trust up early because you want everybody to put money into it. You know, whenever possible, you want people to put money into it. But also, too, what a lot of people don't get told is that so mom and dad are in my office and they're doing a special needs trust. I always tell them, if your parents are alive, I need them to update their estate plan too. Because if you think about it, mom and dad's estate plan says, hey, we leave everything to each other, and when we both pass, it goes equally to our children. But if the children pre-deceases, then it goes to their kids. And we needed to say to the trustee of that special needs trust.

Natalie Picha 31:48

Yes.

Kim Hegwood 31:49

So we don't want that, we don't want to have problems with you know having to worry about making sure that that things go the way you want them to, because if the children inherit money outright and you don't catch it in time, they could lose all their benefits. So, or you have to turn around and put it into a first party trust. So now you've spent more money that you don't want to spend. So it's always better to do planning, get everybody that's involved in the family to do planning as well. Um, I've done a lot of generational planning. I've done grandparents, I've done parents, I've done the kids. And a lot of times that works really well because then you can map everything. Exactly.

Natalie Picha 32:24

When you do generational planning, yeah. You've got to map going. Well, we've got a couple of special needs situations uh that we're working through right now within our firm. And what's interesting is a couple of those are diagnosed later as kind of special needs or having issues. And so the parents are kind of working through the process. It seems sometimes when you've got a child that's got special needs and prior to them turning age 18, you've had that designation. It seems that the sit the process goes a lot easier and they have a lot more benefits available to them versus something that happens later in life. Do you guys help clients kind of navigate that space?

Kim Hegwood 33:01

And so we do, you know, because I want to make sure that clients know what to do. Part of the things that we put in our binder is a little mini special needs trustee handbook, you know, it just kind of hits the highlights. Clients will call and schedule time to talk to me about whatever questions they have. Um, I was scheduling something and looking at my calendar, and I'm thinking, and so a client, the description on my calendar for the 30-minute invite says she has 12 questions. And is it a 30-minute window? And I'm thinking, is 30 minutes going to be enough for 12 questions? I'm thinking I'm thinking, I don't know if they scheduled her enough time, you know. So uh so I may have to redo that one to because I want to make sure that I'm not rushed, you know. I want to make sure that I can sit down and you know spend time with her to answer the questions that she has. And so, and there's there's a lot of good resources out there, you know. We try to give clients as much resources as possible so that they know what to do when they need to do it. And so, in a lot of them though, they'll set the special needs trust up and it's there as a catch-all for when the time comes later. Right. So you still set it up, you still put a little money into an account so that it's in effect. But what you have the ability to is just it's a beneficiary designation for a whole lot of stuff. You know, I used to tell clients if you've got siblings that don't have children, not planning on having children, maybe they take a life insurance policy out and make the trust the beneficiary.

Natalie Picha 34:21

Yeah.

Kim Hegwood 34:22

You know, you know, even if you paid for it, or you know, if they do it early enough, it's a small amount of money to make sure that your child has more money coming in. Right. And so, and that's the goal, you know, always um is to make sure that there's plenty there to make sure they're okay.

Starting The Conversation With Family

Natalie Picha 34:37

Right. Well, and I think you just you mentioning that is that I think in the days, in these days of AI and and just Google search everything, sometimes just sitting down and being a little creative, things that you don't know that you wouldn't just get if you just Googled it, right? So what you just mentioned, mm having a sibling, taking a life insurance policy, that's that's part of the game, if you will, is looking at the complexity of someone's family dynamics and then kind of weaving through all of that to find the very best solution that works in a lot of different ways. And usually one size is not going to fit all at all. So, in your personal experience, how should most people who are not yet in a crisis situation approach their families' estate planning?

Kim Hegwood 35:25

Are you talking about as far as getting it done or talking or maybe the kids talking to mom and dad about it?

Natalie Picha 35:30

No, take well, I think just if they're not in a crisis yet, what should be the first thing that they do? So let's just say someone's done no planning at all yet.

Kim Hegwood 35:39

First off, we want them to call and schedule an appointment with my office so we can get them on the right path. I mean, that's a no-brainer. And um no, seriously. Yeah, you want them to, you got to they have to take that step. And choosing a law firm to to do this with is a real kind of a personal experience. So, you know, you want them to come in, you want them to meet people, you want to really find out. The first consultation in my office, you know, runs of, you know, what are you looking to do? What's important to you? How do you see, you know, your stuff going? So, what what do you have, what's your vision for what happens to your stuff kind of thing? Because you want to get an idea about where they're thinking. And a lot of times you want them to think a little, you want them to think about options. And and the goal when we do planning is to always figure out, you know, if they're thinking about doing something, say, well, that's great. Have you thought about X or maybe Y? You know, or maybe Z is a better plan. And so, so it's sometimes it's a matter of there are lots of different things you can do, and sometimes you can be very creative in the sense of what you want to do. You're going to have some clients that are very clear about what they want to do, right? And then I have some clients that are like, I don't know yet. I'm like, Well, is your child good with money? Well, no, not really. Okay, so we don't necessarily want to give them a lot of money all at once. You know, have you thought about you know who might manage that money? No, hadn't thought about that either. We'll have a great list of corporate trustees if you don't have someone that can do that. We've worked with them for almost 20 years, they're fantastic, they know how to make money, they know how to take care of your child. But we also want you to do something else. Maybe that trustee needs some instructions, they need to know what you want them to do. Right.

Natalie Picha 37:13

Yes, you know.

Hardest Lessons And Biggest Rewards

Kim Hegwood 37:14

So I had a clients come in and they were probably in their 40s or 50s, and they were getting their planning done. And they said, Man, my parents need the plan done, but you know, they have nothing, they have nothing in place. And uh, how do we start that conversation? And I said, Tell them you did your estate plan, tell them what a great experience it was, and tell them how good you feel for getting it done. And so they're like, Oh, that works, and it did. Parents came in to see me, and so and um, but seriously, you have to. I joke all the time and tell clients, oh my god, in my family, we talk about everything at the kitchen table. It is not a subject we have not discussed at the kitchen table, right? Any kitchen table. I don't care where we've eaten, we've had wild conversations, you know, and the big running jug for years was what we were going to do with mom when she when she passed. Because mom started this conversation back when my kids were young, and I can remember it like it was yesterday. It was so weird. The things you can remember, but we're sitting at the kitchen table, the kids were little, they're outside, my in-laws were in, my mom and sisters were there when my mom pops up out of the blue and says, I want to be cremated. And I said, No. She goes, What? I said, You heard me. Uh no, no, we are not cremating you. And she goes, Well, I won't leave you in charge. And I'm like, Well, I'm sorry, but I'm the oldest. You think these other two are going to go against me? No, you know, so mom's mad, but she doesn't want anybody, but my in-laws are there, so she can't be real mad, right? So I've I've ticked her off a little bit. So I said, So what do we do with you? You know, let's assume that we're going to cremate you. What are we going to do with you? And she says, I don't know. I guess you can bury me out at Polly Cemetery. I said, I am not paying for a cemetery plot for ashes. Try again, right? So now I know she's mad, but she's she's got that, she has that look where you know your mom's, you've done really ticked your mom off, but she's not really saying much or anything. So, you know, me being the funny girl I am, I say, Well, you know what, mom, no problem. You know, you got three girls, we'll just trade you off every four months and you can spend time with each of us, right? You know, so everybody giggles a little bit, and then my mother-in-law leans over and she says, Twilight, she says, 'You know, I love you,' but the four months that you're at camps, I'm not coming to visit. And oh my God, we were rolling. Oh my god. Oh, it was so funny. That's a great story. So funny. And I tell this story a lot. And I was telling my mother that I told this story. My mom goes, I don't remember that. I'm like, trust me, I remember it like it was yesterday. And so millions of my clients have heard it too, because it's funny. So the subject kind of went on for years, and you know, and we and we're older and we meet, uh, we meet for lunch a lot. My mom and and two sisters, so the four of us, you know, meet a lot together. We always meet in Sugarland because it's very for uh for each of us to meet. And all of a sudden she says, I now know what I want you to do with my ashes. We're having lunch, right? We're evening talking about whatever, and all of a sudden she's we're back to what are you doing with mom again, you know. Right, right. And um, so she says, I decided that I want you to bury me between Nani and Pawpaw, you know, her parents. And I went, Perfect, that's a great plan. I'm all over that one. That's good. And then I started laughing. Then my sister started laughing, and my mother's looking at us going, What's so funny about that? I said, Well, I don't know why they're laughing, but I'm picturing myself in all black with a flashlight and a post hole digger. And uh, and so so now we're really all laughing. Yeah, you've got to go in the middle of the night and bury the action. Yeah, I'm like, sometimes it's better to ask for forgiveness than permission, you know. So, but um, oh my gosh, it's just a lot of times, even with my grandfather having the conversations with him, because I told him, I said, look, Nani can't sign any more power of attorneys because she's past the point of signing. Yeah, you have to outlive her, you know, otherwise the family fight is on on how we're going to take care of her. Right. And so, because it's it was just that way in my family. I begged him to have the wills updated because the beneficiaries got it at 18. Oh, that was a mistake. Yeah, and uh, and so, but I didn't want to do it because I knew it was going to, I figured it'd create problems, so I didn't do it, I should have done it. So three of those beneficiaries were my kids and they blew through money like there was no tomorrow. Wow. Um, so in my practice, I'm very honest with people. I do not draft for a child under the age of 25 to get anything. I won't do it. I think 30 is a way better number. And uh, and there's very few kids that have proved me wrong, including mine, and I think they're brilliant. And so they're smart kids, but I sometimes think it takes some you know kids a little longer these days to have some life experience and really understand about handling money.

Natalie Picha 41:39

Well, I am so excited that we had this conversation, and I'm so appreciative of you sharing so much about your personal story and your personal situation. I love that what are we going to do with mom conversation and the fact that you're you're so open about it because you've just got to have these conversations. Before we go, I have one more question for you. Two parts. Having practiced in this specific area for over 25 years, what would you say has been your biggest challenge? And also what has been your biggest reward?

Kim Hegwood 42:09

I think the biggest challenge sometimes is is is getting people to do something. You know, you know, take the step, take the step. If it's not with me, take the step with somebody. You're not going to get, I always tell clients, you're not going to get it better, but at least take the step, you know. So um, and the reward is oh my gosh, I have a thousands and thousands of clients that have come through my office. And I and I tell my team, I said, some a financial advisor one time asked me, well, what kind of client are you looking for? I said, a nice one. I said, I want somebody that I could invite home for dinner, somebody that's very personal, you know, somebody that you want to spend time with. I said, because I've had a lot of those and I've been kind of spoiled that way. So that's what I'm looking for in the future is like you just want clients that you will, you know, that you're happy to invite home for dinner. So and um and just spend time with them.

Disclaimer

Natalie Picha 43:02

Yeah, I love that. Oh my gosh, we are much in the same in that regard. That was that is wonderful. I cannot thank you enough for having this conversation, being our guest, and sharing all of your expertise with our listeners today. I look so forward to dropping this podcast and sharing it with your network, our network. I I think it's just going to be a fantastic uh listen to to our listeners. And my hope is that this will inspire them to do something if they have not already. I will remind everyone listening we've if you have done the step and you've already you've already done some planning, please, please, please don't put that plan on a shelf and just leave it there. We have a family this year that I was assured everything was all buttoned up and found out later that the plan had not been taken off of a shelf since 1975. And interestingly enough, everything in that plan was dated, if you could I mean. As you can imagine, uh, most of the people listed had already deceased. So please do something and then also please keep it updated to our listeners. If you enjoy our podcast, please take a moment to subscribe. We would love it if you would leave us a rating and a review because that's going to be the best way for us to reach other listeners. We'd also love it if you would share our podcast with your friends and family. We're always looking for an opportunity to help more individuals. And like Kim said, we like nice people. It's what keeps us going every day. If you can find us on LinkedIn and Facebook, you'll see additional content. And if you have any questions or want to discuss today's subject, please reach out to us through our website at Royal HarborPartners.com. Whether you're beginning your financial journey now or you've already taken steps towards your ultimate life goals, we're here to guide you. Experience the difference of working with a firm that empowers your life, a firm that focuses on what matters most, you. Royal Harbor Partners is a registered investment advisor, and the opinions expressed by Royal Harbor Partners on this show are their own. Registration of an investment advisor does not imply a certain level of skill or training. All statements and opinions expressed are based upon information considered reliable, although it should not be relied upon as such. Any statements or opinions are subject to change without notice. Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Investments involve risk and unless otherwise stated are not guaranteed. Information expressed does not take into account your specific situation or objectives and is not intended as recommendations appropriate for any individual. Listeners are encouraged to seek advice from a qualified tax, legal, or investment advisor to determine whether any information presented may be suitable for their specific situation. Past performance is not indicative of future performance.