Estate Planning for Blended Families With Valerie Hogan

What's most important to you when it comes to choosing your financial advisor? Someone who's aligned with your biblical values. How about someone who will take the time to explain your options? Certified Kingdom Advisors are professionals who meet high standards in competence and integrity and have been trained to offer biblical financial advice.

To find a Certified Kingdom Advisor in your area, visit faithfi.com and click Find a CKA. Blended or step-families have become a new normal. How does that affect their finances? Hi, I'm Rob West. Around 40% of families in the U.S. are blended with at least one child from a previous relationship.

That presents challenges for estate planning. Valerie Hogan joins us today to talk about it. And then we'll take your calls at 800-525-7000.

That's 800-525-7000. This is Faith and Finance, biblical wisdom for your financial journey. Well, it's always fun and educational, I might add, to have Valerie Hogan on the program. We learn a lot. She's an author, an attorney, a certified financial planner, and she's a part of Kingdom Advisors as well. Valerie, great to have you back with us. Thanks for having me on today, Rob. Absolutely.

Valerie, you touch on a number of topics related to estate planning for blended families in your book, Why Is Women Managing Money? And it all starts with communication, doesn't it? Absolutely. I mean, open, transparent, truthful, and that may be difficult at times, but that's really important to be bringing the issues forward. There's no doubt about that, and that involves some prayer as well, doesn't it, as we bring Christ into the process?

Absolutely. I mean, it's just a lot easier to work through things than we have that ultimate common goal of honoring Christ in our life. So, we won't get it right every time, but if we can make peace and then, of course, redemption and restoration, he's in the business of that after all, as the goal, I think we'll really make some forward motion there.

Yeah, that's really helpful. Valerie, as we think about that communication, obviously spouses in blended families may have different goals, so how do they work through that? How would you counsel them? Yeah, I mean, many times there's all kinds of, all manner of blended families, but we tend to see there's kind of the his, hers, and ours sometimes, so compromise is going to be really important.

I like to say, seek understanding, or there's a saying, seek first to understand, then to be understood. I love a great question when you hear something that you're not necessarily in agreement with right away, instead of kind of countering right away, I think a great response might be, tell me more about that, to really get an understanding of where your spouse is coming from, if they're saying something that is not really in alignment with what you think. And then, when that gets really difficult, I think there can be a third party that can come in to maybe counsel through that, to just get another opinion in there and maybe a neutral opinion to help a couple through that. Yeah, and the goal, of course, is to meet the needs of both families in the process, right? Yeah, you really want to get to at least some common goals. Ultimately, it'd be great to be pulling in the same direction on everything, but there may be some goals that are just different, so at least you'd want to get to a process then where you can agree and make peace with some of those being separate goals, but not opposite, or pulling away from what the other is doing. So, you may have, hopefully, some goals that you're pursuing together, and then if there is an independent goal, that both spouses are on board with that. What do you see as some of the common sticking points with blended families? Well, then there's this kind of his, hers, and ours. So, I would say that many times, there would be children maybe from a previous marriage versus the current one, and I think children on either side could tend to feel like, well, the new family is more important, or maybe the new family feels like, why do we keep going back to the previous family? So, I think one of the common sticking points, especially with children that are maybe older, is that they're wondering if they're still important. They're wondering if they're going to be kind of crowded out, or am I noticed? Are things fair? And really, am I important and valued? So, that's one thing.

I think older children can feel like maybe they would be left out or disinherited, and then families might be coming in with different levels of wealth, different assets, just different experiences. So, you might have that conflict as well of how do we work this all out? Yes, that's so helpful.

Well, Valerie, we've just scratched the surface today, so we're going to have you back. But obviously, the goal is unity and to be God-honoring in this process, and there is a way to do that, right? Absolutely.

I mean, speaking the Lord, trying to get to common finances or being at peace with what the solution is, and ultimately, that it's all honoring the Lord. We're always heading in the best direction when we're doing that. The book can help.

It's called Wise Women Managing Money. Valerie Hogan, thanks for stopping by today. We appreciate it. Thanks, Rob. Great to be with you. Your calls are next, 800-525-7000.

We'll be right back. Are you looking for a financial professional who aligns with your biblical values? Certified Kingdom advisors are trusted financial, legal, or accounting professionals who have completed a rigorous certification program to ensure they provide biblically wise financial advice as part of their practice.

You can find a local CKA professional in your area by going to faithbuy.com and clicking Find a CKA. Many in the Middle East are going through horrific circumstances and are seeking refuge in Lebanon. Heart for Lebanon is bringing them hope, and now you can help. We endured shelling and hunger.

We witnessed death everywhere. One hundred sixteen dollars brings emergency supplies and the hope that only comes through the Gospel. I want to spend the rest of my life telling people about Jesus and His salvation.

Give now at faithbuy.com slash lebanon or call 888-201-5577. It's great to have you with us today on Faith and Finance. I'm Rob West. All right, we're going to turn the corner, though, today. We want to get into what you're thinking about financially.

You know, this is a really important topic. Clearly, it's on the heart of God as we look at the scriptures, more than twenty three hundred verses on this passage. And our goal is to equip you to make those practical daily decisions in light of biblical wisdom, recognizing that money can compete, if we allow it to, with God for first position in our lives, that we can seek the things of this world to provide satisfaction and satisfy our longing for abundance. And yet we know that the things of this world will always leave us empty, that God is who we were designed for. He is our abundance and that He should be our ultimate treasure. Money is then a tool to accomplish His purposes. So how do we do that in light of a biblical worldview and given the many practical money related decisions we have to make every day? Well, that's why we're here. So if you have a question today, we'd love to hear from you about it, whether it's living, giving, owing or growing God's money.

You can call 800-525-7000 and we'll dive into those questions together. All right, let's begin today in Las Cruces, New Mexico. Hi, Mary. Go right ahead. Hey, thanks, Rob, for taking my call.

Your show blesses me beyond measure. I have a question around the settlement of my mom's estate, and I was wondering if it is it's kind of divided into two pieces, like the bulk of it was up in Ohio and it's all settled and she didn't have any real property or anything like that. So what I'm talking about right now is another piece of it, a small pension.

And so that's the last piece that's needing to be settled. And it's it's basically going through, it's supposed to be going through probate, right, for some reason, because she she passed in in a different state. Anyways, my question is around the paperwork.

I've gotten paperwork from the attorney that was hired in the state where it's going through probate. So he's working for my mom, essentially. And I got paperwork from him that was appears to be asking me to forfeit my right or to how they say it to, you know, to it was a waiver, essentially, forfeiting my right to an audit of her estate. And I thought, Is that normal? Do they do they do they do that a lot?

And why would I Why would I want to? And, and particularly in this case, since there was a little financial misbehavior involved with her estate, historically, so that's kind of my, my first question. And then my second question is, kind of a part B is like, I feel like I need to find an attorney to, you know, kind of, kind of navigate the attorneys.

And is that because I mean, don't they have like a day you sit down at a conference table and everybody reads the will and, you know, with an attorney president, and you kind of get kind of get it out on the table, so to speak. Sure. So those are those are kind of A and B of, of my question. Yeah, yeah. No, that's helpful, Mary. And I can understand why you're just trying to think through all this, because you certainly don't want to make a misstep here on this.

Do you know the personal representative or executor who's named in the will to handle all of this? Yes. All right. Yeah, that doesn't sound like a good thing necessarily. But all right.

Yeah, very good. And let me just say, I'll give you a kind of a part A and a part B to my answer. Part A is I'm not an attorney. And so to the extent you have, you know, legal questions, I would always direct you back to an attorney. And at the end of the day, if you're concerned about how this is handled, yeah, having an estate attorney represent you as a part of this process, or at least as a sounding board is never a bad idea. Now, really speaking is a waiver of accounting, a standard procedure, it certainly can be for a fairly simple situation. The reason you would do it is it eliminates the need for an extensive and expensive when that's the key accounting process by the personal representative or executor. So it makes sense as long as the personal representative is provided comprehensive information about the accounting, you know, when the estate is administered, and therefore a final accounting may not be necessary if all the information has been provided. And that's where it does in a fairly simple cut and dry situation become somewhat routine from the personal representative.

Now, if you have concerns over the finances of the estate, you don't feel like you've been given all the information or you feel like there's some question, then I would say this is probably the situation where you do not decline or you decline the waiver, I should say. So that that found final full accounting can be done. And even though that may result in a smaller estate, to the extent that that's going to have to be then paid for, that would give you some peace of mind that at least you know, things have been handled properly. And that may be a very worthwhile expense for you, given what you're alluding to, and I don't need to know the details of what may or may not have taken place. Does that make sense? Right on.

Yes, it does. So is there a great resource you can point me to quickly for a good Christian, like attorney? Yeah, what I would say is I would probably reach out to a certified kingdom advisor there in your area and ask for a referral to an estate attorney. That's what you want an estate attorney who understands your worldview, a godly person who could represent you and answer your questions to look out for your interest.

So go to faithfi.com click find a ck or find a professional and any one of those certified kingdom advisors Mary can refer you to a godly estate attorney either in your area or the area where the estates being settled. Thanks for your call. All right, let's move right along. By the way, we have some lines open at 800-525-7000. You can call right now. Let's go to Chicago. Hi, Mike, go ahead.

Hello, how are you? I really enjoyed the program. Very helpful.

Quick question. So on my 401, you know, the traditional 401, I can actually view the amount that it's being recorded as a Roth account. And I do have a certain amount of money there. I wonder if that part of them, the 401, you know, account, I can get out as soon as I retire, which is going to be a few months probably. And do I have to pay taxes for that or not, since I think is that that's paid already?

As long as that's been open at least five years, and you're over 59 and a half, you can pull out the contributions and the gains without any taxes on a Roth 401k. Oh, that's fantastic. Yeah, very helpful. Thank you so much. Okay, no problem.

We appreciate your call. Anything else I can help you with? That was a quick one.

No, that that will do. Thank you. Appreciate it very much. Okay, have a nice one. Really enjoy your program. Bye bye.

Absolutely. Thank you very much. I appreciate that. Well, folks, so we're going to head into our first break here in just a moment.

But we do have some lines open today. So if you have a financial question, you'd love to wrestle with it. We'd love to talk to you about it.

You can call 800-525-7000. You know, here's the goal on this program. We want to help you see God as your ultimate treasure and money, a tool to accomplish God's purposes. Think about this. You know, money is a good gift, a creation from the Lord. The problem is when we worship the creation over the creator, it's a distorted picture.

And that's what happens when sin enters the equation. So our goal is to renew our minds with scripture, to maintain an eternal perspective, to make God our ultimate treasure, and then everything else falls into place, including money. But we've got to push away the world's message that says your self-worth is equal to your net worth, that says you deserve to have these things, that says money will occupy and satisfy places that God was only intended to occupy. Let's do that together as we talk about a biblical worldview of money right after this break.

We'll be right back. Explore a new way of investing that aligns with your values. More information is available at oneassent.com and by clicking Analyze My Investments. We are grateful for support from Soundmind Investing in the Faith and Finance Program. If you have money in a retirement account or just a general investing account, you know the stock market can sometimes seem like a roller coaster.

But it is possible to enjoy both profit and peace of mind in investing, no matter what's happening in the market. You can see a short video webinar on that topic at soundmindinvesting.org. Since 1990, Soundmind Investing has sought to offer financial wisdom for living well. Soundmindinvesting.org. Hey, great to have you with us today on Faith and Finance here in our final segment today.

Perhaps room for one more question, 800-525-7000. Before we head back to the phones, let me mention, you know, I don't have to tell you this, you're experiencing it every day. Things just cost more now. I mean, we're experiencing this across the board, which means that it's more difficult than ever to stay on budget, to live within our means, which by the way is the key to every financial success. Once we recognize God owns it all and we're stewards, we've got to commit to live within God's provision. And one of the best ways to do that is to have a plan. You've got to have a plan. You've got to give every dollar a job and make it specific. And then if you stick that plan in the drawer and don't look at it again, well, it does you no good. You've got to have a system to control the flow of money in and out so you can stay on plan.

So if you're married, you and your spouse, or if you're single, so you every month or during the month can say, where am I? You know, what's going on in my financial life? How's that eating out envelope looking? What about the clothing envelope? Oh, yeah, I've got that car repair envelope over there.

You know, do I have anything in there? Because I'm probably going to need to use it in the next couple of months. I mean, that's the way we stay on plan. And that's why we built with a team of developers over many years. That's why we built the Faithfi app is to help you do just that. So if you'd like to set up your plan, connect your accounts, have a simple way to manage God's money using the digital envelope system alongside all the other encouragement content and community and all the features there for stewards like you. I would encourage you to download the Faithfi app today. You'll find it on our website at faithfi.com. That's faithfi.com.

Just click app or search for Faithfi in your app store. Let's go to Hudson, Ohio. Beth, go right ahead.

Hi, Sarah, thank you for taking my call. My question is, I'm wondering if I should pass our mortgage is at 3% just shy of 70,000. We recently sold a small family business. So I've invested some but just wondering about that.

Yeah, it's a great question. So are you on when are you on track to pay it off by if you just continue on? Probably 12 years. Okay. And what are your age? I am 62. Okay. And are you married?

Yes, my husband is 60. Okay, great. And are you all one or both of you still working?

We both are, yes. Okay, excellent. And how long do you plan to continue to work at this point? I'll probably work till I'm 66 or 67. And I'm sure he'll work about that age too. We have another business that we both work at.

Oh, okay, great. Yes, another five to seven years. And how do you feel like you're doing toward retirement, Beth? I mean, apart from this, the proceeds of this sale, do you have other assets in stocks and bonds retirement accounts? A few in stocks and bonds, we do have a retirement account as well. Okay, we each have that and the Lord's blessed us very well. Okay, so do you feel like you're on track with your retirement savings apart from this?

I do. Yeah, okay. And then talk to me just about your desire to be debt free.

I mean, is it something like, listen, if it makes sense on paper, that's great. But if it doesn't, we're comfortable hanging on to this mortgage? Or is one or both of you just really convicted about being out of debt as soon as possible? This would be our biggest debt to house. I mean, other than that, it's just utility bills. And maybe in the far future, we'll have a car payment or something. But I think that's affordable. I don't know.

I mean, a lot of questions. I don't neither of us really feel convicted, wasn't sure what to do. And we can find a good savings with our interest rate that's well over the 3% of our mortgage.

Yeah, very good. I mean, I think that's the key is obviously this is a very low rate. If you had said to me, Rob, you know, I just really want to be out of debt. I mean, it's been weighs on me, I just want I want this gone, then I would say great, that really should come first. But apart from that, if we just do this on paper, you know, there is a case for you just to continue to pay this down. I mean, one option would be, you know, you split the middle, which is rather than waiting 12 years, it sounds like you guys are going to transition out of at least the current business that you're in in the next potentially seven years. So what if you were to put a plan in place to try to get this paid off by retirement, you could run an amortization schedule with a free calculator online just to say, Okay, what would we need to send extra every year so that this is gone in five or six or seven years. And that way, as you're transitioning into this next season of life, whatever that looks like, this largest expenses coming off the table, but it allows you to hang on to the cash that you haven't put it to work, whether that's in a CD, or, you know, in a, you know, in an investment account, you know, I mean, rates are high now, they're probably not going to be as high a year from now. And so if all things are equal, meaning, you know, let's say rates come down to four, and after tax, because you're gonna have to pay tax on the interest for the CDs, you're really not making much more than you, you know, are paying in interest on the house, then you might as well pay it off at that point. And the only thing you're losing is the liquidity that comes from having that cash available if you need it. But if you're going to invest it, you know, in a properly diversified stock and bond portfolio, maybe on the more conservative end, because you guys are, you know, within five or seven years of retirement, then you have the potential to say, make five or six or 7%. And now all of a sudden, you know, there is a decent margin there between what you're paying in interest versus what you're getting. So I think I would go one of the two directions, I would either say, Listen, I'm going to put this to work right now, while rates are great, and I always have the option to pay it off, you know, down the road, or B, I'm going to go ahead and invest it.

And then I want to put a plan in place to have my mortgage paid off by the time we retire. And so we're going to try to send at least that much extra every year, just out of our current cash flow, so that we don't ride this out 12 years, but it's gone in five or six. Does that make sense? It definitely does. Yeah.

And we were thinking along that line somewhat, but I really appreciate your advice. Excellent. Well, I really appreciate your call, Beth. Thanks for being on the program.

It's a great problem to have and a good question. So thanks for giving us a call today. Let's go to North Carolina. Hi, Roy.

Go ahead, sir. My question is, I was talking to a buddy of mine and I didn't want to give the wrong information is social security disability. Is that considered as taxable? And also is considered as as income?

Yeah, it's a good question. It may be taxable and here's why. Generally it's not, but if you receive income from other sources, so think dividends or tax exempt interest or you're married and your spouse earns income, that's where it may be taxable to you if you get above a certain threshold. So for instance, for 2023, if you're married and filed jointly, you could report up to 32,000 of income made up of half of your SSDI benefits plus all of your income before you would need to pay taxes on your SSDI. If you're single or head of household for 2023, that would be 25,000 of income, half of your SSDI plus any other income.

If you get above 25,000 single 32,000 married, that's when you'd pay taxes on the on the SSDI. Does that make sense? It does.

It does. And thank you. I appreciate that. You're very welcome, Roy. Thanks for your call today. We appreciate you. Thank you for being here as well. We'll hope you'll come back and join us tomorrow. We'll do it all over again. We'll see you then. Bye bye. Faith and Finance is provided by Faith Buy and listeners like you.