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Mike On Money

August 27th, 2025. Well it’s time to add to my blog. Seems like the Covid ordeal put a damper on posting. This blog post is about disinheritance actions. I can say very honestly that this subject is one of the most controversial consulting areas in my legal documents practice. When I am hired to draft legal documents in estate planning that limit or completely disinherit a child or grandchild, my heart starts beating faster. I have had to do it a lot over my long career and it never sets well with me. However, the dictate to create terms of disinheritance for offspring does have value in the estate planning arena.

Perhaps, more and more children, grandchildren in the past few decades have gone against the wishes of their parents or grandparents and acted in ways, (including inactions as well) that did not please the estate client who after much deliberation, has come down to dictating this legal move to remind them, after the death, that there was a cost to pay for certain habits, actions, in-actions, harmfully spoken words in anger never recalled, abandonment of visiting, etc.

I hate to see the “hammer” come down this way after a client dies, but they are in charge at the time they draft and they have their reasons to restrict or eliminate certain beneficiaries, normally their own children, who they are unhappy about their lifestyle, habits, that have hurt the estate owner/s. So it is a way to remind after a death, the true cost of their actions. (or inactions) If this is something you are exploring, I have a lot of experience in drafting legal documents (Wills, Trusts) that will help carry out your wishes to disinherit someone. Smart attorneys can contest the provisions and try to prove a “senior” was not at full mental capacity when the disinheritance clauses were drafted. Or try to prove in a formal “contest” court filing they simply forgot them.

Just know, as much as I hate doing these, I have studied for years the best terms to draft so that the decision does not get amended by a Judge in a formal court contest filing. Since 2009, Arizona trust code law is pretty liberal in this area compared to other states (such as my home state of Iowa who will let a Judge disinherit you if you even get mad at a Executor or Trustee), as it takes a formal “contest” court procedure here in Arizona and an extremely clear and egregious situation in order to lose your share of an estate you were named a beneficiary (heir) of.

I close in saying the wording in Wills and Trusts will normally in most states contain language that you are to be treated as if you (and perhaps all of your offspring) are to be treated as if you pre-deceased the descendent. I tell clients that in honest frank language, (without practicing law of course), that this pretty well means you are “dead” to the parent who disinherited you and thus, not able to get any share. Leaving other siblings to redivide the money and assets amongst themselves right in front of your eyes. (legally dead, personally very much alive).

A free 15 minute conference by Zoom or in person can discuss the general legal information pertaining to drafting such a provision in your Will or Trust with me. Call me at 1-800-782-2806 or email me at mdanderson@webfsi.com

I hope and pray this blog post does not apply to you!

M.D. Anderson

SLEEP DISORDER

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In the middle of an epidemic, yes I could repeat the mantra on every newscast in America. I won’t waste time doing that. But I do want to “ring the bell” on steps you should consider right now regarding your money and your property.

I had the pleasure this week to help a long term client who openly admitted she didn’t understand the mutual funds she has owned for many years. Luckily, they were picked for her by another financial advisor and he picked them well. I got a call when these funds lost a big chunk of money when the equity markets dropped a few months ago. Worrying about the fear to have to go get a job after many years of retirement scared her to death.

Since she had held her mutual funds long term, I told her it might be best to wait and see if some loss could be recovered. We waited and luckily, the market returned most of her gains. This week, she had recovered from most of the unrealized loss’s and because of her fears of another crash coming and inability to sleep well at night, I assisted today helping her get into cash (money market) and out of the stock market.

She had a sleep disorder for months over the loss’s that scared her so much. It wasn’t sleep apnea, or a loud neighbor’s dog, but the fear she would wake up and see another big drop in her equity accounts. And run out of retirement money before long. I can attest, her financial position does not allow for any more big loss’s. Looking at assets, income producing assets, retirement accounts and life expectancy, the risk of staying in equity investments that she did not understand was too high.

I first suggested considering selling 1/2 of her equity accounts and transferring them to a product that had guarantees on her principal. She liked that idea but did not fully grasp how it would work. But when it came down to a face to face chat this week, it was apparent she never ever wanted to be scared like she was when a big chunk of money had disappeared. (on paper) SHE WANTED OUT!

I also felt it was time to review the few areas I don’t take care of for her in her finances. Upon examination of her insurance plans, I found her insurance policies for auto and homeowners were either overpriced or under protected in case of a major loss. In fact her homeowners policy replacement cost could build a townhouse at best for her if her home burned down. But not a nice beautiful home in a retirement community like she has now.

We are quoting with another carrier and adding an umbrella liability policy as well for quotes. The key in your financial planning is to be sure you insure all risks possible to protect your net worth. This includes medical insurance as well as long term care (nursing home) protection. And proper limits of liability insurance.

As I have done for so many families and individuals for 45 years, I am assisting her in “recasting” her money accounts into investments that meet her investment risk factor (she is a 0 for risk on a scale of 1-5 according to my client). Our new investment financial plan will be completed in a few weeks or less. Rethinking your protection mechanisms, recasting your investment accounts for more safety in a year proven to be like no other (and it is only 1/2 way through) makes a lot of sense.

The best part of all, my client has solved her sleep disorder by using FSI’s free consulting services. Yes, I get paid on some insurance products as an insurance broker. But they are GREAT products from GREAT companies. Not poorly rated company and products so many insurance agents push on you because they pay higher commissions.

Call me to help you solve any sleep disorders caused by having too much money in the stock market. DON’T PROCRASTINATE!!!

M.D. Anderson, Notary, AZCLDP, Realtor, Accountant, Insurance Broker

Michael AndersonFinancial Strategies, Inc.1 Comment