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Estate Planning in Plain English – Podcast Episode 287


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On this episode of the Dentist Money™ Show, Ryan interviews attorney Nathan Jay Kavlie of Thoughtful Wills. On the show, Nathan and Ryan go document-by-document over what’s needed to preserve the estate you are working so hard to create. Estate planning can seem complicated, but Nathan explains why he doesn’t believe it should be by illustrating how he takes the legalese out of wills and trusts.

Show notes:
www.ThoughtfulWills.com

 


 

Podcast Transcript

Ryan Isaac:
Hello, everybody. Welcome to another episode of the fantastic Dentist Money show, if I don’t say so myself, or if I do say so myself, brought to you by Dentist Advisors, a no commission fiduciary comprehensive financial advisor just for dentists, dentists all over the country. Check us out at dentistadvisors.com.

Ryan Isaac:
Today on the show, we’re talking about estate planning, something that, frankly, is confusing for everybody. There’s a lot of questions and misconceptions and misunderstandings about what estate planning is. Who should do it? When do you begin it? Does it involve a will, a trust, an estate, medical directives? Does it protect you from creditor protection and getting sued, and all these things? So today on the show, I have Nathan Kavlie from thoughtfulwills.com, a great partner of ours, who’s been really helpful in getting all these things organized in our client’s lives. Today, Nathan, very directly and bluntly, which I love him for … He’s so good at this. Just down to earth, basic, plain language about estate planning for a dentist, what you need to know in today’s episode.

Ryan Isaac:
Thanks for joining us. If you have any questions for us, go to dentistadvisors.com, click the book free consultation link, and schedule a chat with one of our very friendly dental-specific advisors today. Thanks for being here, guys, we really appreciate it. Enjoy the show.

Announcer:
Consultant an advisor, or conduct your own due diligence when making financial decisions. General principles discussed during this program do not constitute personal advice. This program is furnished by Dentist Advisors, a registered investment advisor. This is Dentist Money. Now here’s your host, Ryan Isaac.

Ryan Isaac:
Welcome to the Dentist Money show, where we help dentists make smart financial decisions and avoid bad ones along the way. I’m your host, Ryan Isaac, and I’m joined today by Nathan Kavlie, If I said that right.

Nathan Kavlie:
You did.

Ryan Isaac:
There’s probably three different pronunciations. Nathan Kavlie of Thoughtful Wills. Welcome to the show. Thanks for being with us today, man. How are you doing?

Nathan Kavlie:
Thank you. It’s a good day.

Ryan Isaac:
I’m always curious, where are you joining us from? Where do you live in the country?

Nathan Kavlie:
Yeah, so I live in south Minneapolis, in Minnesota.

Ryan Isaac:
Okay. All right. I’ve never been to Minnesota or Minneapolis. I just think of cold there. Is that a fair representation?

Nathan Kavlie:
It’s cold for seven months of the year.

Ryan Isaac:
And then beautiful the rest of it, amazing summers.

Nathan Kavlie:
Yeah. Our summers are amazing.

Ryan Isaac:
Just amazing.

Nathan Kavlie:
Actually, this summer, my husband and I were talking, because everything’s loosening up with COVID, and was like, “Oh, we should go somewhere.” Then it’s like, “Well actually, why don’t we just wait and go when it’s cold?” So we’re kind of sticking around all summer-

Ryan Isaac:
Okay.

Nathan Kavlie:
… because it’s amazing. It’s 70s, 80s, low humidity, and yeah.

Ryan Isaac:
Beautiful. Beautiful, that’s awesome. Well, maybe one day we’ll get out there. That’d be great.

Nathan Kavlie:
We’d love to have you guys come.

Ryan Isaac:
Well, thanks for being here. Today on the show, we’re going to talk about your company, Thoughtful Wills. Obviously, we’re going to be discussing legal matters for dentists, estate planning, wills, trusts, things like that, but we’re going to do it … Well, I’ll just tell the audience right now and then you can give an intro. But we’ve met you by just doing business with you guys and sending some clients your way. Some of our advisors helped us find you. We did a lunch and learn with your company recently, and it’s always refreshing. I don’t know if this is a good reflection on you only, or if it’s a bad reflection on the industry, and I think about my own industry like this too, you were actually just refreshingly candid, down to earth, and nice. I could understand what you were talking about as an attorney and that’s not always the case. I think that’s true for accountants and financial advisors. Sometimes, our industries tend to talk over people’s heads on purpose, or-

Nathan Kavlie:
Yeah. No, I take that as a high, high compliment.

Ryan Isaac:
Okay, good.

Nathan Kavlie:
Really, it’s that piece where I feel like there are the learned professions that have talked down to people for so long. That’s why people … It’s part of why I think people are hesitant to work with lawyers, or to go to the doctor, or to go to the dentist, or to … Even my mom, my mom hates taking the car into the mechanic because they all … just all of that stuff. It just feels so old school and totally unnecessary. But it actually requires, I think, a lot of intentionality to get rid of.

Ryan Isaac:
It does. Well, you got to be conscious of it. Some of it’s probably you’re just so used to doing your job in your niche, in your industry. There’s so much jargon. There’s a lot of technicalities and really difficult concepts in terms of [inaudible 00:04:34], so you probably … I mean, my dentist does this to me sometimes. He sits down and he starts pointing at things on a chart and says words I do not understand at all, and I’m like, “Come on, man, you got to write this in a crayon for me.”

Nathan Kavlie:
Well, it’s translation, ultimately. That’s one of the things I think, we each have our gifts. Like Notesong, my business partner, is that she used to be a nurse, and she’s a mother, and you just hear the caring through her voice.

Ryan Isaac:
Oh cool.

Nathan Kavlie:
That’s a talent, right? It’s a gift that people have, and ultimately I think one of mine is translation. That’s what’s really required. It’s like all professions have our short codes, our lexicons that are professional terms that nobody else understands. We use them to save time when we talk to each other, but you have to really code switch and translate concepts. It’s, I think, a fine art, because that’s the thing that’s always happened, right, when I … There have been times when I’ve had some less ideal doctors where it’s like they’ll be like, “Oh, you have blah, blah, blah,” some Latin phrase. I’m like, “I don’t understand.”

Ryan Isaac:
I don’t know.

Nathan Kavlie:
Then they’re like, “Your tummy, there’s a little thing in your tummy.” It’s like, is there a full ground between-

Ryan Isaac:
Where’s the middle ground here, man?

Nathan Kavlie:
I mean, I’m not a Latin scholar. I’m not an MD, but I am also not a child. I feel like that’s the intentionality that’s really required to spend the time to really be thoughtful about who you’re talking to and to hit that mark of being approachable, and without dumbing things down. Checking in with people too, because I always say that when I’m with clients. Then I’m like … Because we have clients that know a lot about wills already. They’ve done a lot of research. Then we have others that just know it from TV shows and stuff. So I’ll just tell them and be like, “Hey, please just interrupt me and we’ll dial it down or dial it up, or just yeah.”

Ryan Isaac:
Well, I really appreciate that. It stood out to me a lot when we were just hearing from your company and learning about what you guys do. Let’s maybe reverse a little bit. Tell us, how did Thoughtful Wills begin? How did you get into all of this? Who are you guys? What’s the origin story?

Nathan Kavlie:
Notesong and I are both attorneys. Thoughtful Wills is a law firm. The technical name of our law firm is Notesong and Nathan LLP, so we’re-

Ryan Isaac:
Notesong and Nathan, okay.

Nathan Kavlie:
Yeah. We do businesses as Thoughtful Wills. That’s what everybody knows us as, but we are in fact an actual law firm. Which is different, because most of the things that you go online when you search online wills and stuff, they aren’t law firms. You have to dig in the little bottoms part where-

Ryan Isaac:
Big difference.

Nathan Kavlie:
Yeah. They’ll say things like, “Oh, drafted by an attorney,” and stuff, but not for you. An attorney drafted the document and then sold it to LegalZoom. That’s where … There’s a lot of doublespeak, but we are lawyers. I’m based in Minneapolis. Notesong is based in Madison, Wisconsin, and we have attorneys that we partner with all over the country that act as our local counsel. They are a key part of our process as well. Really, what we offer is a blended … I describe us as we’re basically the love child of a main street old school trust and estates lawyer and LegalZoom, because-

Ryan Isaac:
And the online stuff that everyone wants now, but, yeah.

Nathan Kavlie:
Yeah, because we’re sort of in the middle. It’s where we’re actual lawyers, but we operate in a lot of ways to take best practices from LegalZoom to save time. That makes our prices a lot lower and also then frees up our time so that we have an ability to really meet with our clients and spend as much time as we need to explain things without rushing through stuff, so, yeah.

Ryan Isaac:
Now I think it might be obvious. To me it seems obvious why it not being just an online platform to print some forms, like a LegalZoom, which, I mean, certainly probably has its place in the industry. It’s probably very helpful in a lot of situations, but it seems obvious to me why it would be important for an attorney to be involved. Like for example, I’m working through something, some estate planning with a family member who’s in retirement and trying to just figure out, okay, now what do we do with the real estate we own? They’re on a budget, so they’re going to LegalZoom. Then they’re asking me, “Well, you’re in the financial industry, so do we need a trust or just a will, or do you need both, or how do they work together?” So to me, I’m like, “Well, this is why an attorney should actually be involved in some form of the document selection or creation.”

Nathan Kavlie:
No. I mean, it’s one of those pieces. It’s like, not everybody needs a will.

Ryan Isaac:
Okay.

Nathan Kavlie:
But how do you know if you’re one of those people that needs a will or not?

Ryan Isaac:
Well, let’s get into … Okay, so that sets the stage perfectly. We can take this pretty fluid a bunch of different ways, but I think for our audience, what would be helpful is the concept of estate planning, wills, trusts. It seems confusing. The feedback I get from people is they don’t really know when do you do it? What are the trigger points in someone’s life? Maybe let’s begin with what’s a will? What is an estate plan? What is a trust? When do people typically need to start thinking about having these things in their life?

Nathan Kavlie:
Sure. So a couple of things first to explain. Not everybody needs a will. Let’s start there. Who doesn’t need a will? A single person who’s close to their family. If I were a single guy and I love my mom and dad, I’m good without a will, because if I die, everything goes to my parents. That’s just how it works, right?

Ryan Isaac:
Yeah.

Nathan Kavlie:
Then if you have a more complicated situation, that’s where it’s like if I’m in an unmarried partnership, my girlfriend and I have been living together, then you need a will. Because no state in the country recognizes unmarried partners for purposes of-

Ryan Isaac:
Asset transfers.

Nathan Kavlie:
Yeah, asset transfer without a will, so you need a will then, for that. If you’re doing dentistry, right, every dentist needs to have a comprehensive estate plan. That’s just the long and short. You can save a lot of money in the long run if you have a comprehensive plan, not just a will, but a comprehensive plan, and you can … It offers more privacy. That’s the thing. If you die, most people now have these trusts that protect your privacy. But back in the day, we would know what Elvis’s will said, or Marilyn Monroe’s will, because probate is a public process. So your dirty laundry and stuff gets aired out, and if you cut your kids out of your will and all of that juicy stuff-

Ryan Isaac:
It’s a public.

Nathan Kavlie:
Yeah. It’s a judicial process, so it’s in the public domain. So it offers a lot of cost savings and it offers privacy. Not to be derivative, but the tough questions for us, like should I have a will and a trust? Should I have a comprehensive plan, or do I just need a will? Those are conversations for people who are social workers, and elementary school teachers, and bus drivers. Folks like dentists, doctors, accountants, you guys need … You don’t need, sorry. Here’s the thing, if you die without a will, stuff will happen. Every state in the country has a system. Like if both of you guys die in a car crash and your kids become orphans, something will happen. Your kids will not just be let out to roam the streets, right?

Ryan Isaac:
But it’s messy.

Nathan Kavlie:
Yeah, its messy, and a judge will decide who raises your kids instead of you. The default plans in each state will distribute your stuff, so this stuff will happen. Your kids will not just be roaming the street like feral cats, but you get to … In order for you to make sure that what you want to have happen, happens, in order for you to save money, in order for you to gain privacy, you need to have a plan.

Ryan Isaac:
Okay, finish your thought [crosstalk 00:12:25].

Nathan Kavlie:
Oh yeah. Oddly enough, for dentists, it is a simple answer. You need a comprehensive estate plan. You will be better off. You will save money. You will have a more private everything, just lots of good benefits. Yeah, so what is involved in a comprehensive plan?

Ryan Isaac:
Yeah, I was just going to ask that.

Nathan Kavlie:
The first thing is going to a will. A will is basically your … it’s your last will and testament. The word testament comes from the idea of testify, like testimony. It really is your statement of your wishes of what you want to have happen when you die.

Ryan Isaac:
Okay.

Nathan Kavlie:
It’s an old school document, came over from England. Most of our legal stuff comes over from England. It contains things like who gets your stuff, who gets your CDs, who gets your real estate, who gets your jewelry, who takes … Then it also covers stuff like who takes care of your young children, who takes care of your pets.

Ryan Isaac:
It directs everything. The will is the thing that directs the flow of what should happen according to your wishes.

Nathan Kavlie:
Basically. Yeah, it gets a little complicated and I’ll go through that.

Ryan Isaac:
Okay. Yeah. Good.

Nathan Kavlie:
Because., of course, it’s like … That’s the thing, too. I feel like you go to law school and I think they train you to never answer a question simply, and I’m-

Ryan Isaac:
Well, I’m also asking you to explain probably a year’s worth of knowledge in about 30 minutes, so.

Nathan Kavlie:
Well, yeah, kind of. That’s okay too. I love that. I was actually teaching law school last spring, and it was a-

Ryan Isaac:
Cool.

Nathan Kavlie:
I loved it.

Ryan Isaac:
[crosstalk 00:13:47].

Nathan Kavlie:
The will, it’s your expression of what you want to have happen, and it is unique. Not every country in the world does it this way. I mean, there’s no reason why we would have to, as a society, let dead people decide who gets their stuff, right? I think it’s in Greece-

Ryan Isaac:
It’s an interesting concept.

Nathan Kavlie:
Yeah. I think in Greece, it goes to the oldest son and stuff, even if you’re … It doesn’t have to be this way, but we have this great … It’s an amazing document, just to be clear. I think estate planning is amazing. It’s like superhero stuff, because really it is like, you’re gone. You’re in the dirt, but you’re actually making things happen in the world of a living. You’re taking care of your kids, and you’re setting up trusts to put them in good standing for education, and you …

Ryan Isaac:
That’s cool.

Nathan Kavlie:
I think it’s amazing.

Ryan Isaac:
Yeah, that’s cool.

Nathan Kavlie:
So there’s the will. It’s this old school document from England. Unlike most of modern world where you can just sign with your finger at Target, or you can just click here to agree, wills are old school. It’s about ink on a piece of paper with witnesses, and that’s the key. That’s what’s required, and the reason for that is because the thing, unlike most documents you sign where if there was a legal dispute, you could show up at a court and say, “Yep, that’s my squiggled signature.” With a will, the person who wrote the will is dead, so they can’t testify. That’s why there are these really old school, very detailed requirements about who has to sign, how many witnesses and all of that. That’s the will.

Nathan Kavlie:
In the 1960s, 70s, the living trust became a piece of estate planning. Trusts are old as well. They go back to the crusades in England. It basically is that idea of somebody is taking care of your stuff for the benefit of somebody else, and it’s a unique … Trusts are an amazing tool and they can be used for all sorts of things. You can use them to protect the inheritance of your kids. You can use them to create charities. We use what’s called a revocable living trust. What basically happens is, the reason you use them is, I don’t know, people have usually heard about probate, but don’t know what it is. Probate is usually this boogeyman. Again, to go back to it, it’s a judicial procedure that winds up people’s estates, and because it’s a judicial procedure, it’s public. It’s also expensive, because you have to hire lawyers, and you have to serve notice.

Ryan Isaac:
So the family or whoever is incurring more costs just to say where everything’s going to go. Even if they know where it’s supposed to go, then they have to incur more costs.

Nathan Kavlie:
Even if you have a will, yeah, and especially too … I know that a lot of dentists do some real estate investing. If you have real estate in multiple states, like if I own property in Minnesota and Wisconsin, I then get the pleasure of doing probate in both states. So your costs just go away.

Ryan Isaac:
Only real estate is the asset class in both states that would make that happen, or it’s like what if there’s … A lot of people practice … they’ll have two locations on a border of two states.

Nathan Kavlie:
That’s a good question. I mean, then the asset is essentially LLC. I think it’s probably real estate because the LLC, essentially, even though your business is operating-

Ryan Isaac:
Yeah, it’s separate.

Nathan Kavlie:
… you would have single purpose LLCs that own those, and then those might be held by holding companies.

Ryan Isaac:
Interesting. Then that would be a unique situation. Yeah, that’s really interesting.

Nathan Kavlie:
Yeah, but real estate will totally screw you. Yeah.

Ryan Isaac:
I love that. That’s a hot take.

Nathan Kavlie:
But in a good way, right? I mean, there’s a reason why we invest in that because it [crosstalk 00:17:17]. So probate is this thing that is a hassle and it’s expensive. There are a bunch of different things called … they’re called non-probate assets, like retirement accounts or life insurance. The thing with retirement accounts and life insurance is that they have their own beneficiary mechanism built in, so that when you die … When you sign up for a life insurance policy, you say who you want to get the money. As a result, life insurance doesn’t go through probate. Sorry, this is a … It’s again, a winding road to follow along. I apologize, but-

Ryan Isaac:
No, this is good. I think we’re all following along [crosstalk 00:17:51].

Nathan Kavlie:
This is the magic. The magic that happens is a trust is a non-probate asset. It’s a non-probate mechanism. So if you move, … Basically what happens is that your life insurance, your retirement accounts, those happen non-probate regardless, so you don’t have to worry about them. We encourage you to think of them as part of your comprehensive plan. But the key is that a trust lets you take physical stuff like your real estate and like your jewelry and your cars, you can put them into your trust and they then become non-probate assets as well.

Ryan Isaac:
Okay.

Nathan Kavlie:
That’s the da, da, da, da, and after all that fanfare, I realize it’s kind of a let down to be like a trust let’s you put physical assets and turn them into non-probate property, but-

Ryan Isaac:
It’s a beginning. Now, probate drags out though.

Nathan Kavlie:
It is.

Ryan Isaac:
I mean, that’s another problem is it takes a long time for someone to get the money they know they’re going to get anyway, but they just have to sit around and wait for courts to decide, right?

Nathan Kavlie:
Yeah, it’s a hassle. Yeah. Prince’s estate still hasn’t finished and it was five years ago that he died, so it’s-

Ryan Isaac:
Whoa.

Nathan Kavlie:
Yeah. I mean he also didn’t have even a basic well, so there’s lots of things there. So the key with a trust is that basically … So what ends up happening is for a comprehensive plan, and this is what we tell all of our dentists to do, is you get a will and the living trust and they work together. They dovetail to take care of all of your stuff. What ends up happening is your will will talk about who should take care of your kids, who should take care of your beloved pets. All of the stuff about who gets your stuff, who gets your assets, that will all be moved into your trust. So that way, then they dovetail together and they form this really great combo. Yeah, so those are the sort of when you die documents. The other two pieces are actually about when you’re still alive, and they just have become part of a comprehensive estate plan just because they just … They’re all kind of yucky in the same [crosstalk 00:19:48].

Ryan Isaac:
All the stuff you … we don’t … You were here on this the other day when we were having a chat with you, like these are the things you don’t really like to discuss. They’re not fun subjects, but they’re realities.

Nathan Kavlie:
It’s exactly. It’s me saying like, so we have figured out what will happen when you die. Now let’s talk about what happens if you’re in a coma.

Ryan Isaac:
Yeah, while you’re slowly dying. You’re sick.

Nathan Kavlie:
Yeah, exactly. So it’s healthcare directive, durable power of attorney, and these documents basically authorize somebody to act on your behalf if you are not able, and so-

Ryan Isaac:
If you don’t have them, what happens if you don’t have these documents?

Nathan Kavlie:
Again, there’s mechanisms, right? If you don’t have a durable power of attorney and somebody needs to get access to your checking account to pay your kid’s school tuition or something, there’s this delightful thing called conservatorship. Then you petition the court and say, “Nathan’s in a coma and can’t sign and we need to do this and will the court authorize it?” It’s a hassle

Ryan Isaac:
In probate, the person’s gone and maybe it’s not as urgent to divvy up assets. Maybe there is more time just because it’s maybe there’s more. Maybe there’s some urgent situation, but it’s probably less urgent than someone’s in a coma or needs major medical decisions to be made urgently. I was going to say, there’s got to be a lot of situations where families fight about all kinds of healthcare decisions.

Nathan Kavlie:
Oh yeah. No, exactly. It’s one of those pieces that we actually put in a lot of our … we put in our worksheet and we talk about in the interview. So the healthcare directive lets you nominate a person to make decisions for you. That person is your healthcare agent. It also lets you create instructions. I think that’s a huge piece. It’s really, I think, a kindness to the people who love you because then, I mean, just imagine how yucky it would be to be the person that has to decide if you’re going to pull the plug or not.

Ryan Isaac:
I know, yeah.

Nathan Kavlie:
And they don’t know for sure, right? That’s where this document is a true … It really is a kindness. I hate that phrase, but it’s so-

Ryan Isaac:
No, that makes sense.

Nathan Kavlie:
Because you’re telling that person, “I don’t want to be in a vegetative state for years. I don’t want that.” Or you’re telling them, “I want that. I want to be hooked up to machines until my heart stops or whatever, until there’s absolutely nothing.” We have clients that come on both sides of the spectrum, but the nice thing then is that it’s written down. So you have somebody that is ultimately is vested with the authority to make that decision and they have your words. So if your parents that either are not into comas and want to pull the plug, or if you’ve got the Catholic parents that think that any of this is a deadly sin, there you can just sidestep the hunt. You know what I mean? Hopefully, that doesn’t mean necessarily that your parents will respect what you wrote in the document, but [crosstalk 00:22:40].

Ryan Isaac:
True, but they can.

Nathan Kavlie:
Legally speaking, it’s totally sound. There’s just no … It’s like, yep, we’re done.

Ryan Isaac:
Man. Okay, so that’s four parts to recap. We have a will, an estate or no, a will, a trust, medical directive, and power of attorney. Would you call it-

Nathan Kavlie:
Yeah, durable power of attorney.

Ryan Isaac:
Okay, durable power of attorney. That’s right. Okay, so those are the four parts of of a comprehensive estate plan. I would agree with you any dentist … I mean, maybe there’s some dentists who are like, again, maybe they’re single, no kids. Maybe they don’t own a practice, they just have a job somewhere.

Nathan Kavlie:
Sure.

Ryan Isaac:
Maybe those are the situations where it could be. But I would agree with you any … if you have a family, kids, you own a practice, you own a building, just don’t mess around with piecemealing it together.

Nathan Kavlie:
Exactly.

Ryan Isaac:
You should have it all.

Nathan Kavlie:
We tell, we hear from a lot of people when they’re either pregnant or have kids, just somehow that triggers a lot of worries, granted obviously, because you start worrying about that. But that’s when a lot of people, I think, come to us and then say, “Oh, we’re ready to do this.” But truth be told it’s like, anytime might be the right time, depending on your circumstances, and we’re happy to chat with you.

Ryan Isaac:
Cool.

Nathan Kavlie:
We’re happy to chat with anybody. I mean, we’ve had people where I was like, “You’re single. You’re a social worker. You like your family. You don’t need a will, but you do need a health care directive. Let’s get you hooked up with that.” But by and large, I mean, the thing that’s nice about this is a comprehensive estate plan, you might want to amend it here and there. But the nice thing, especially with this trust, that’s the weird other part that we could talk about later or something. The key to the trust is moving all of your assets into the trust. So that is its own-

Ryan Isaac:
That’s like the house you live in, life insurance policies, real estate-

Nathan Kavlie:
Yeah, cars, your real estate.

Ryan Isaac:
… businesses.

Nathan Kavlie:
Yeah, your business, your LLC that you operate and own, all of that stuff. So as soon as you start acquiring or if you’re about to, because then you can … I think the nice thing is you get the reassurance of knowing all of your estate plan is in place, so that if anything bad does happen, you’re covered. But the other nice thing is that you’ve already got it set up in place. You have it in place then, so then when you do start acquiring assets, you can just put them in there from the get-go and save yourself the hassle that’ll come, because we … I think a lot of people are like, “Oh, I’ll switch to a living trust when I’m in my 70s.” Then it’s like, well, doesn’t that sound fun, to spend a couple of months just redoing all of your assets. Anyways, and we have cool clients like that. They’re lovely, but you can save yourself the hassle by doing it early.

Matt Mulcock:
On the Dentist Money show, we teach dentists how to make smart financial decisions.

Ryan Isaac:
You’re correct.

Matt Mulcock:
I mean, is that all it takes Ryan, to make smart financial decisions, listening to our show?

Ryan Isaac:
Matt, it’s a good first step, but to put your financial future on the fast track, the next smart decision is to go to dentistadvisors.com. What you do there is you click on the book free consultation button, right in the middle of the home screen. Then you schedule a time to talk with one of our very friendly, dental specific financial advisors today.

Matt Mulcock:
Okay, so I have a question. It comes up a lot. I think there’s misunderstanding or misconceptions about having an estate plan for the things we’re talking about, and then having some kind of estate plan, if that’s even the right term for it, for, I don’t know, call it creditor protection. Business owners have significant assets and are worried about being sued by somebody. How do those two things coincide, or are they totally two separate deals?

Nathan Kavlie:
They’re kind of separate. The comprehensive estate plan is really about avoiding probate.

Ryan Isaac:
Okay.

Nathan Kavlie:
There’s more and more talk now about this asset protection or liability avoidance. It gets really complicated because essentially … I don’t know how to put it. It’s not supposed to work. I mean, essentially what you’re trying to do is have your cake and eat it too, right? You’re like, “I want to play with my boat, but I want to make sure that nobody can get my boat if I-”

Ryan Isaac:
Yeah, hit someone with it.

Nathan Kavlie:
Yeah, if I do malpractice and I get sued, I don’t want anybody to get my boat, or my house, or my car. The system, you’re supposed to be on the hook for your liabilities. So when you’re thinking about … A couple of things to keep in mind is, and this is, I think, things that people do usually now. You don’t operate your dental businesses as sole proprietorship. You create an LLC. So that is a limited liability company that’s designed then to absorb and contain assets … contain liability within the company. That way then, it won’t … Essentially, only the assets that are owned by the company are at play if there’s liability to related to the company.

Ryan Isaac:
Great. Yeah, [crosstalk 00:27:18] the rest of your life.

Nathan Kavlie:
Yeah. I mean, I think a lot of things that people do already, it’s like, there’s already a lot of good asset protection built into just normal business practices.

Ryan Isaac:
Well, most dentists own their practice. I mean, most nowadays that I talked to, they are LLCs. They’re filing as an S-corp or they’re just an S-corp. Their buildings are in separate LLCs. So there’s probably some basic things they’re doing anyway that covers some of those grounds.

Nathan Kavlie:
All of that helps, but in [crosstalk 00:27:41].

Ryan Isaac:
They carry insurance, liability insurance, and yeah.

Nathan Kavlie:
Exactly. Insurance is another key piece too. I mean, there are lawyers out there that will help you draft, and essentially they’re irrevocable trusts designed to become creditor remote.

Ryan Isaac:
Okay.

Nathan Kavlie:
The problem is they’re, and this is that thing. If you really enjoy spending money on lawyers and meeting with lawyers, I mean literally, because the thing is, is that here’s the deal. A comprehensive estate plan is really simple. You set it up. You put your … You don’t have to do a lot to it. But these asset protection trusts are complicated, and they require that you don’t mess them up. Because if you do them wrong or if you mess-

Ryan Isaac:
Title an asset or open an account the wrong way.

Nathan Kavlie:
Yeah. Most of the assets can’t be moved in unless you own them outright. So anything that’s mortgaged, your lender is not going to be happy if you put your house into an irrevocable trust.

Ryan Isaac:
Yeah.

Nathan Kavlie:
Yeah. Anyways, I digress. I mean, the thing is I guess what I’m trying to tell people is there’s already a lot of asset protection and liability protection built into the way that most people operate good business practices. Create a limited liability entity just to house your business, adequately insure your risks. Then I think people just need to chill out a bit too, because honestly I think it’s weird, because it’s the dentists and doctors are so freaked out about liability.

Ryan Isaac:
Sure, yeah.

Nathan Kavlie:
The lawyers aren’t. Lawyers do not sit around … Seriously, lawyers do not sit around-

Ryan Isaac:
They’re like, “Sue me. Let’s do this dance.”

Nathan Kavlie:
Yeah. I figured it out. Let me tell you about my crazy trust that will keep anybody. So it is, it’s like, yah. I think I just want to tell people you’re probably good. Just do good work, right?

Ryan Isaac:
Yeah, your insurance, do the normal stuff. Okay, [crosstalk 00:29:32].

Nathan Kavlie:
Yeah, don’t do malpractice, carry insurance, and this is what we do. I mean, that’s the thing. We’re professionals. We do good work. We offer people refunds if they’re not happy. We have malpractice insurance and we have a limited liability partnership. That is how our entity is formed.

Ryan Isaac:
Okay. When we talked about … We were joking about this in the beginning, but tell us about the way that you guys tried to … I thought this was interesting too, and really helpful, the way you try to structure just the verbiage and the wording of documents. You said something like your mom understands her will that you wrote for her.

Nathan Kavlie:
Yeah.

Ryan Isaac:
I thought that was like a really cool way to put it.

Nathan Kavlie:
I mean, so much of it is … My dad’s an electrical engineer and my mom teaches piano lessons. Well, they’re both retired now, but that … My mom, I’ve always thought … I mean, it’s the thing, I remember my mom not wanting to go into the mechanics. I remember my mom being talked to go to doctors and stuff. So as an attorney, it was really important for me always to meet people and use phrasing that honors and respect to them. So that, it’s a thank you to my mom, but in the same token too-

Ryan Isaac:
That’s awesome.

Nathan Kavlie:
Yeah, it really … Our documents are really amazing, and that is a very intentional process. It’s a lot of work that we … a lot of time and energy that we took to rewrite these documents to make sure that you can understand them. The weird thing, so the story I tell is my best friends had me review their will because I’m the godparent of my goddaughters, right? so-

Ryan Isaac:
They’re like, “We paid an attorney already, but we don’t trust the guy we paid, so you look at it.”

Nathan Kavlie:
Yeah, exactly, and I think it happens more often than you would believe.

Ryan Isaac:
Yeah, I’m sure.

Nathan Kavlie:
I mean, honestly too, I have lawyer friends that are like, “Yeah, I don’t even know. I can’t even read my will.” It’s a weird thing that they have these documents that are so old and nobody … they just are inherited. It’s like the old lawyer, when you start, gives you his will, and then you just start using that, and [crosstalk 00:31:24].

Ryan Isaac:
From an outside perspective, I would wonder, well, doesn’t it have to be this really difficult legalese phrasing, or else it’s not legally binding?

Nathan Kavlie:
No.

Ryan Isaac:
And it doesn’t, right? No.

Nathan Kavlie:
It doesn’t. We’ve had some questions because sometimes folks are essentially like, have your documents been stress tested and stuff?

Ryan Isaac:
Sure.

Nathan Kavlie:
But the fact is, it’s like the law is very clear about what’s required for a legal … for a will and a trust to be legally valid. But some of it, I mean, honestly, how do I want to put it? It’s a lot of time and energy that we put in, but some of it I think is just so plain, so dumb. Like why were we the first to think about this? So going back to my friend’s-

Ryan Isaac:
Okay, [crosstalk 00:32:02].

Nathan Kavlie:
26 page document. Obviously, the reason they went to go get a will is because they want to make sure their kids, somebody will … there’s somebody to take care of them. That was on page 23. I kid you not.

Ryan Isaac:
Out of 26.

Nathan Kavlie:
Yeah.

Ryan Isaac:
That was the main goal of the [crosstalk 00:32:17].

Nathan Kavlie:
Yeah, that was the impetus. That’s why they went and did this. So that’s how it works.

Ryan Isaac:
Because why, there’s 22 pages of just template?

Nathan Kavlie:
Yeah, talking about fiduciaries and talking about how the trust will function, and all of that.

Ryan Isaac:
Definitions and okay.

Nathan Kavlie:
Yeah. So we were like, “Well, you know what? Our clients are here because they’re wanting to take care of their kids. So let’s put the stuff about the kids on page one,” and that’s how it is. Literally, our document starts out like, “Hi, my name is Nathan Kavlie. I live in Minneapolis and I’m married to Corey, and I have no kids.” Then it talks about … Well, let’s pretend I have two kids. So I have two kids, and then literally the next section is here’s who takes care of my kids. That’s what we’ve done. We’ve basically gone through and tried to … and the other-

Ryan Isaac:
Get someone to read it and go, “Yep, this is still current, and I understand my own will, great.”

Nathan Kavlie:
Yeah, exactly, because otherwise that’s the piece. It’s like, people like to think they do a will once. You just have to do it once, but then they look at it and they’re like, “Well, I can’t read this document, so I hope I remember who.”

Ryan Isaac:
Yeah, I hope that’s covered everything. You said we can wrap up on this. This has been really cool.

Nathan Kavlie:
Oh yeah.

Ryan Isaac:
Now, you said something in the meeting we had with you the other day that I thought was a really cool phrase. I don’t know if this came from you.

Nathan Kavlie:
I don’t know.

Ryan Isaac:
You should just claim it. You should just claim it, but you said don’t let perfection be the enemy of good.

Nathan Kavlie:
Oh, that’s not a Nathan quote. That’s a famous one.

Ryan Isaac:
Well, you should just take it.

Nathan Kavlie:
Well, I think the phrase is, don’t let the perfect be the enemy of the good.

Ryan Isaac:
Cool. How do mean that in the legal … Like when it comes to someone’s estate plan, how do you see that happening?

Nathan Kavlie:
I see it happening in so many ways. First of all, people are like, I know I need to get all these things figured out first, and then I will contact the lawyers. That’s the first mistake, because again, that’s why we’re here. We are here. All you have to do is decide that you want to do it and sign up with us. Then we’re here to have meetings and we will explain what you need to know. We will explain the decisions you need to make. You don’t need to … It’s that thing of like, it’s like my grandmother, when she used to wash the dishes before she put them in the dishwasher.

Ryan Isaac:
My father-in-law still does that. I love [crosstalk 00:34:20].

Nathan Kavlie:
You don’t need to do that. That’s the thing. It’s like, we have a dishwasher. You just put them. The same [inaudible 00:34:24]. It’s like, we will help you create your estate plan and you don’t need to know any of it ahead of time.

Ryan Isaac:
I was really impressed by the way that you guys have married technology with good old fashioned customer service. You answer the phones?

Nathan Kavlie:
I do.

Ryan Isaac:
People are surprised that you, the attorney who owns the company picks up the phone?

Nathan Kavlie:
I know. I was driving to go out of state to get my vaccine for COVID. The phone rang and I answered it, and the guy was like-

Ryan Isaac:
You?

Nathan Kavlie:
Yeah, he was like, “I was just reading about you,” and I was like, oh yeah, well, you know.”

Ryan Isaac:
I asked about your company, [crosstalk 00:34:57].

Nathan Kavlie:
Yeah, so we talked. Yeah, I mean, that’s like …

Ryan Isaac:
I think that’s really cool. Where can people find you? What’s the easiest way to reach out and get in touch and get some questions answered and start the process?

Nathan Kavlie:
Yeah, so our website is called thoughtfulwills.com. You just go there and in the upper right-hand corner, it says let’s connect. So shoot us an email, give us a call. You can schedule right on our calendars, and that’s the thing. I don’t schedule meetings before 10:00 AM because I’m not a morning person.

Ryan Isaac:
Solid, yeah.

Nathan Kavlie:
Literally, any of those spots, take them. Just feel free. Yeah, we like talking to people.

Ryan Isaac:
Yeah, I relate to that. I think it’s really cool you guys are doing, and I have a lot of admiration for people who are trying to just put a new spin on old industries. Because people need this stuff. They need financial advice. They need legal advice, but it’s intimidating. It’s confusing and it’s not fun all the time. So I really appreciate the work you’re doing. Thanks for being with us today.

Nathan Kavlie:
It was my pleasure.

Ryan Isaac:
Yeah, this was awesome. I think we’ll end up doing a webinar for everyone who likes watching our webinars too. So we’ll do that again soon, but thanks for being with us. Thoughtful Wills, guys, check them out. We’ll post all the links and everything in the comments, but thanks for being here, man. You have a good time.

Nathan Kavlie:
Thank you.

Ryan Isaac:
Yeah, you’re very welcome. Thanks everyone for tuning in and listening to another episode of the Dentist Money show, and we’ll catch you next time. Take care.

 

Estate Planning

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