Estate Planning Reimagined: From Step-Up Basis to Blockchain Governance

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Welcome to Something More with Chris Boyd.

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Chris Boyd is a certified financial planner, practitioner,

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and senior vice president and financial advisor at

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Wealth Enhancement Group, one of the nation's largest

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registered investment advisors.

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We call it Something More because we'd like

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to talk not only about those important dollar

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and cents issues, but also the quality of

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life issues that make the money matters matter.

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Here he is, your fulfillment facilitator, your partner

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in prosperity, advising clients on Cape Cod and

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across the country.

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Here's your host, Jay Christopher Boyd.

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Welcome to the program.

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Thanks for being with us.

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I'm Chris Boyd, certified financial planner, practitioner here

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with Jeff Perry.

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We are both of the AMR team at

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Wealth Enhancement, and our guest is recurring guest,

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my brother, F.

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Keats Boyd.

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He is the third.

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He is a principal at Boyd & Boyd,

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well-known for estate planning.

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Estate planning is for financial planners an essential

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topic of conversation as we think about trying

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to look at a variety of things that

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our clients need to consider as they look

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at their tax planning, their investment planning, their

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insurance, and so forth.

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Estate planning becomes one of those really big

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topics and lots of nuance.

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Today, we're going to talk not only about

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some basic and important estate planning considerations, but

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we're also going to be bringing in some

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of the cutting edge, what's happening, and why

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don't we start, Keats, I know it's seminar

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season.

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I see you have your seminar schedule in

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front of you.

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Maybe we want to mention that to anyone

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who's interested in just learning a little bit

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about estate planning.

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I'm reluctant to say it's the basics because

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you get into some really important and dynamic

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components of things for people to think about

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in their estate planning that's not very basic.

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These seminars for people who haven't been, they're

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entirely educational.

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It is an opportunity to really get a

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grasp of the issues of what do I

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need to be thinking about?

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Who are the players?

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Who do I need to be thinking about

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to fill what roles?

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What kind of concerns that I have?

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We think of sometimes estate planning as the

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practice of who's going to get my stuff

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when I'm gone.

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It's a lot more than that.

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It's really more importantly about you in the

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process for many of the decisions and the

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concerns we think about and the structures, the

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tools that you can help people have to

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utilize to make sure that they have things

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working for them while they're alive the way

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they want and for their distribution of wealth

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subsequently how they want.

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Let's tell a little bit about when these

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seminars and where they are.

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It's local to Cape Cod.

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This is really about how to make sure

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that the brand new tax law that went

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into effect, it was signed on July 4th,

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many of the features go into effect next

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year.

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You want to make sure your estate plan

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is properly reflecting the opportunities that this new

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law provides.

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We've got some seminars set up.

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We actually started on the 10th and we've

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got more on the 16th, 17th, 23rd, and

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24th of September of 2025.

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We're going to be able to just provide

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some good education, talk about really the shift

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away from estate tax avoidance while it's still

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an issue for people who reside in the

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few states that still have an estate tax

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like Massachusetts.

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We're more concerned about making sure the estate

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plan does proper income tax avoidance planning, getting

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the most step up in basis as possible

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whenever we can, looking to make sure that

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the trusts and the wills that we're using

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will minimize the income tax impact because very

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often most structures are set up to have

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a very high income tax.

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You're in the highest bracket at a very

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low tax rate, a very low income amount.

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So we want to make sure that we're

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at a low threshold of income.

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Suddenly you're into a very high tax rate.

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And so what we're trying to do is

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restructure it so that we're looking through to

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the beneficiary to make sure that it's the

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beneficiary's tax rate we're paying, not the separate

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trust tax rate.

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That can be very high.

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So there's a lot of things like that.

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We'll want to make sure we're dealing with

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asset protection.

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What we find is most people think of

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estate planning as a once and done event.

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I go and see my lawyer once every

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10 years.

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I maybe update my will or update a

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trust, but I don't really need to do

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much else.

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And it's really a process.

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You know this with financial planning.

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You're constantly updating and tweaking, revisiting the investment

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portfolio to make sure that things change, decisions

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are being considered.

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Oh, we're thinking of buying that other house.

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We might relocate or whatever.

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And many people are still thinking, oh, I

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just need a will.

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And surprisingly, that's not really the case.

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You really need to be doing something more.

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The problem with a will and traditional estate

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planning is you gather up your wealth during

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your lifetime.

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And then when you pass away, you're really

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using an upside down funnel.

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You take your wealth and you're spreading it

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out amongst a bunch of people.

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Some of it goes to the government, some

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of it goes to your dad, some of

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it goes to the attorneys, some of it

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goes to your family, some of it might

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go to charity.

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It's going off in all these different places.

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And your family, there's lots of different people.

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And so it's getting chopped up and smaller

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and smaller.

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So we're spreading out that wealth so it's

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not as effective.

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A good estate plan will take that funnel

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and turn it right side up so that

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we're keeping that wealth concentrated and controlling it

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and using tools like vehicles for family governance,

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a family constitution effectively to say, here's what

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we as a family want to have this

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wealth do and achieve to borrow off the

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Rockefeller model rather than using other models that

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just let the wealth be dissipated.

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And so a lot of that structure is

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done through a revocable trust as the centerpiece

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of the plan, but then you supplement it

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with things like legacy letters.

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Hey, the trust gives the legal stuff, but

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here's the value set that I hope you'll

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use with my wealth.

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Yeah, I think that's overlooked a lot.

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It is.

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And so that's something that we're putting an

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emphasis on with our clients.

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And then as I mentioned, the idea of

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a family constitution, some mechanism to make sure

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that there are rules for family governance, that

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as things change that we don't anticipate today,

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your plan can be flexible and deal with

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those changes.

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I just want to be clear.

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It sounds like you're saying something a little

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different than I've heard in the past, and

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that is the idea that I have wealth

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and I want to pass it on to

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my heirs, my children primarily.

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Granted, there may be other hands out in

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the process with taxes and administrative concerns.

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You sound like you're saying to retain that

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in a single location, a trust or perhaps

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or some kind of corporate entity, not to

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disseminate that to the different parties.

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I'm thinking that sounds like a recipe for

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conflict.

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Is this- Concentrate it and not disperse

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it out.

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I think the big difference is a preposition

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that our dad used to talk about.

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You give it for your family, not to

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your family.

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And so using a trust that's built to

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retain the wealth, it's not to say that

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we don't want the kids to use and

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enjoy it.

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That's not the goal.

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The goal is to make sure that-

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It's not to prevent that.

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Yeah.

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We want to make sure that they're getting

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the benefit of the gift that you're leaving

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the kids, that they can decide how to

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invest, for example, their portion of the inheritance.

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We're not trying to take that away.

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So their portion of the inheritance, they still

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control their piece of it.

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Their portion, right.

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The difference is really understanding that ownership, property

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rights are analogized to a bundle of sticks.

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Jeff, you may remember this.

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If I own a piece of land, when

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I own it outright, I got the whole

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bundle of sticks.

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That might be the right to take crops

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off the land.

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That might be the right to live on

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a house that's on the land.

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That might be the right to dig out

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minerals from the land.

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It might be the right to sell the

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land in its entirety.

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It might be the right to retain the

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right to live there, but sell the remainder

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interest.

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It's all different rights that are one big

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bundle.

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What we're trying to do with a good

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estate plan these days is to say to

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the kids, here's the entire bundle of sticks

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except one stick.

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We're going to keep the ownership stick in

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the trust set up by mom and dad.

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So mom and dad's trust will own it.

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You can do everything else with it.

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And why is that desirable?

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Okay.

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Because if you own all the bundle of

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sticks and I sue you for some reason,

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I can take away some or all of

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the sticks.

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But if I don't own the sticks, you

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have a harder time taking those from me.

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Right.

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I can't take the ownership away because I

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may sue you, but I'm not suing mom

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and dad's trust.

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Mom and dad's trust didn't get into a

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car accident.

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Mom and dad's trust didn't have some negligent

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act.

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Didn't have an employment disagreement.

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So there's value in having that protection in

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effect.

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That's right.

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And so- So I still can control

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it all.

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I can have the benefit of it and

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enjoyment of those resources without the liability of

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the risk- The risk of loss that

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someone can take it away from you.

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Right?

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Okay.

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And so what we're trying to do is

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keep it concentrated in mom and dad's trust

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and then supplement that or compliment it with

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family governance documents, whether that be an LLC

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or in the new technology world, right?

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Yeah, it's a business entity.

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And so effectively in some cases, let's say

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that mom and dad have a home here

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on the Cape and they want the kids

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and grandkids to keep the home and use

275
00:11:08,380 --> 00:11:10,300
it for multiple generations, right?

276
00:11:10,700 --> 00:11:11,300
Haven't seen that.

277
00:11:12,800 --> 00:11:13,920
What are we doing?

278
00:11:14,080 --> 00:11:16,640
We're putting our kids into a business relationship.

279
00:11:17,540 --> 00:11:19,460
We may not think of it that way,

280
00:11:19,620 --> 00:11:21,720
but we're forcing our kids to be partners

281
00:11:21,720 --> 00:11:23,600
in the ownership of this home.

282
00:11:23,980 --> 00:11:25,620
And we need to set up a business

283
00:11:25,620 --> 00:11:29,540
structure to allow the kids to properly manage

284
00:11:29,540 --> 00:11:31,560
that, to say, hey, you as the owners,

285
00:11:31,660 --> 00:11:37,380
you may need to contribute to do a

286
00:11:37,380 --> 00:11:37,880
renovation.

287
00:11:38,240 --> 00:11:40,480
If we decide we can rent the property

288
00:11:40,480 --> 00:11:41,980
out and use the rent to pay for

289
00:11:41,980 --> 00:11:44,420
some of these expenses, or maybe we're all

290
00:11:44,420 --> 00:11:45,120
going to take turns.

291
00:11:45,260 --> 00:11:46,560
But now if one of the kids moves

292
00:11:46,560 --> 00:11:48,660
to California and we're forced to stay in

293
00:11:48,660 --> 00:11:51,880
this business relationship, what's going- What's fair?

294
00:11:52,000 --> 00:11:52,460
What's equitable?

295
00:11:52,820 --> 00:11:53,780
How do we manage that?

296
00:11:53,780 --> 00:11:56,500
What if my finances require that I can't

297
00:11:56,500 --> 00:12:00,140
afford to maintain this relationship and I need

298
00:12:00,140 --> 00:12:01,900
to sell- And other family members pick

299
00:12:01,900 --> 00:12:02,360
out what happens.

300
00:12:02,360 --> 00:12:03,680
No, I like to stay there.

301
00:12:03,800 --> 00:12:05,000
I don't want to sell.

302
00:12:05,000 --> 00:12:05,220
Right.

303
00:12:06,080 --> 00:12:07,300
Now what do we do?

304
00:12:07,420 --> 00:12:07,540
Right.

305
00:12:07,740 --> 00:12:09,900
And that can be handled through a business

306
00:12:09,900 --> 00:12:12,320
structure like a limited liability company.

307
00:12:12,900 --> 00:12:15,600
LLCs are great because they are the simplest

308
00:12:15,600 --> 00:12:18,300
of business structures if you're going to get

309
00:12:18,300 --> 00:12:20,900
into a formalized business relationship, right?

310
00:12:21,040 --> 00:12:23,660
That doesn't have a lot of formalities to

311
00:12:23,660 --> 00:12:24,580
deal with.

312
00:12:24,860 --> 00:12:26,000
Annual meeting or whatever.

313
00:12:26,000 --> 00:12:28,100
You don't have to have officers and elections

314
00:12:28,100 --> 00:12:31,200
and corporate resolutions and all this other stuff

315
00:12:31,200 --> 00:12:32,960
that keep the lawyers busy if we use

316
00:12:32,960 --> 00:12:34,380
a corporation, right?

317
00:12:34,960 --> 00:12:37,580
Corporations are great if you're a lawyer because

318
00:12:37,580 --> 00:12:39,380
you've got lots of work that you need

319
00:12:39,380 --> 00:12:39,800
to do.

320
00:12:40,120 --> 00:12:43,160
Not so great if you're the business owner

321
00:12:43,160 --> 00:12:44,980
who just wants to do the business of

322
00:12:44,980 --> 00:12:46,680
managing the real estate, right?

323
00:12:47,380 --> 00:12:49,360
And so LLCs are a great tool for

324
00:12:49,360 --> 00:12:52,760
people who are- Families in that circumstance.

325
00:12:53,100 --> 00:12:53,200
Yeah.

326
00:12:53,200 --> 00:12:56,280
They're really good at whatever their business is,

327
00:12:56,320 --> 00:12:58,320
but not great at the formalities.

328
00:12:58,320 --> 00:12:59,020
All right.

329
00:12:59,100 --> 00:13:02,720
So LLCs, trusts, things like that.

330
00:13:02,780 --> 00:13:06,080
And now with the advent of blockchain technology,

331
00:13:06,400 --> 00:13:10,660
there's another opportunity for family governance called a

332
00:13:10,660 --> 00:13:13,200
decentralized autonomous organization.

333
00:13:13,840 --> 00:13:14,500
Hold that thought.

334
00:13:14,700 --> 00:13:14,860
Okay.

335
00:13:15,900 --> 00:13:19,600
Let's wrap up the mention of the more

336
00:13:19,600 --> 00:13:23,480
familiar type of estate planning that you'll be

337
00:13:23,480 --> 00:13:26,260
talking about at the seminars and share where

338
00:13:26,260 --> 00:13:27,480
those are going to be or how people

339
00:13:27,480 --> 00:13:29,200
can register before we go on to-

340
00:13:29,200 --> 00:13:29,400
All right.

341
00:13:29,460 --> 00:13:29,640
Great.

342
00:13:29,760 --> 00:13:31,760
So yeah, if you're interested in learning about

343
00:13:31,760 --> 00:13:35,800
just general estate planning devices, wills, trust, powers

344
00:13:35,800 --> 00:13:38,900
of attorney, healthcare proxies, living wills, how they

345
00:13:38,900 --> 00:13:41,340
all interplay with each other, how they handle

346
00:13:41,340 --> 00:13:44,600
incapacity care planning, how they handle passing wealth

347
00:13:44,600 --> 00:13:47,040
to death, how they handle taxes and asset

348
00:13:47,040 --> 00:13:47,280
protection.

349
00:13:47,280 --> 00:13:49,180
And you'll touch on things like the LLC

350
00:13:49,180 --> 00:13:50,660
and things like that as well.

351
00:13:50,800 --> 00:13:50,900
Yeah.

352
00:13:50,900 --> 00:13:51,000
Exactly.

353
00:13:51,520 --> 00:13:54,840
So again, they are at the Wauquoset Resort

354
00:13:54,840 --> 00:13:57,180
on Tuesday, September 16th at 10 in the

355
00:13:57,180 --> 00:13:57,400
morning.

356
00:13:57,420 --> 00:13:58,580
These are all at 10 in the morning,

357
00:13:58,640 --> 00:13:59,340
by the way.

358
00:13:59,720 --> 00:14:01,800
Wauquoset, Tuesday, September 16th.

359
00:14:02,060 --> 00:14:04,720
The Courtyard by Marriott in Hyannis on Wednesday,

360
00:14:04,900 --> 00:14:05,900
September 17th.

361
00:14:06,700 --> 00:14:09,940
The Daniel Webster in Sandwich on Tuesday, the

362
00:14:09,940 --> 00:14:10,680
23rd.

363
00:14:11,260 --> 00:14:14,300
And finally, the Windsor House in Duxbury on

364
00:14:14,300 --> 00:14:16,480
Wednesday, September 24th.

365
00:14:16,860 --> 00:14:20,160
And to register, it's a really easy URL.

366
00:14:20,160 --> 00:14:26,640
You can go to www.ursvp.com.

367
00:14:26,680 --> 00:14:28,840
So that's the word, U-Y-O-U

368
00:14:28,840 --> 00:14:30,640
-R-S-V-P.com.

369
00:14:31,220 --> 00:14:35,440
And enter a code C-E-G-B

370
00:14:35,440 --> 00:14:37,860
-U-S, or you can call our office

371
00:14:37,860 --> 00:14:41,640
at 508-775-7800 and just tell somebody

372
00:14:41,640 --> 00:14:43,420
that you'd like to register for the upcoming

373
00:14:43,420 --> 00:14:43,880
seminars.

374
00:14:44,060 --> 00:14:45,200
We just need to know how many people

375
00:14:45,200 --> 00:14:45,880
are going to be there.

376
00:14:46,840 --> 00:14:48,060
And they'll help you figure out which one's

377
00:14:48,060 --> 00:14:50,700
the best time and location for your availability.

378
00:14:51,200 --> 00:14:54,640
So that number again is 508-775-7800.

379
00:14:55,440 --> 00:14:56,160
All right.

380
00:14:56,420 --> 00:14:58,940
That's what you'll be talking about at the

381
00:14:58,940 --> 00:14:59,860
seminars.

382
00:15:01,240 --> 00:15:04,440
Now we want to talk about an evolution.

383
00:15:05,140 --> 00:15:10,260
There is a new technology people may want

384
00:15:10,260 --> 00:15:13,040
to know about, be familiar with, and maybe

385
00:15:13,040 --> 00:15:17,600
start to gravitate towards this making use of

386
00:15:17,600 --> 00:15:19,120
a blockchain technology.

387
00:15:19,860 --> 00:15:20,460
And what did you say?

388
00:15:20,560 --> 00:15:21,660
Decentralized?

389
00:15:22,000 --> 00:15:25,920
Decentralized autonomous organizations, DAOs.

390
00:15:26,160 --> 00:15:27,300
Some people say DAOs.

391
00:15:28,280 --> 00:15:35,680
It's a business entity that is used primarily

392
00:15:35,680 --> 00:15:39,500
in blockchain technology for managing a blockchain.

393
00:15:40,220 --> 00:15:40,580
Okay.

394
00:15:41,000 --> 00:15:43,160
This is going to sound confusing to people.

395
00:15:43,320 --> 00:15:44,040
What's blockchain?

396
00:15:45,560 --> 00:15:49,200
We've heard the term primarily in the context

397
00:15:49,200 --> 00:15:53,480
of cryptocurrency, but that's not the only use

398
00:15:53,480 --> 00:15:54,620
of the blockchain.

399
00:15:54,880 --> 00:15:56,120
Blockchain is a technology.

400
00:15:56,760 --> 00:16:00,000
In a sense, it is not necessarily tied

401
00:16:00,000 --> 00:16:01,360
to cryptocurrencies.

402
00:16:02,700 --> 00:16:05,180
Historically, it's been, we're all familiar with because

403
00:16:05,180 --> 00:16:06,700
of Bitcoin and Ethereum.

404
00:16:06,700 --> 00:16:10,180
If you've followed that type of cryptocurrency at

405
00:16:10,180 --> 00:16:14,080
all, that is where this was first developed.

406
00:16:15,600 --> 00:16:18,400
To me, it's taken a distracting side turn

407
00:16:18,400 --> 00:16:23,880
into NFTs, non-fungible tokens for lions and

408
00:16:23,880 --> 00:16:25,200
apes and silly things.

409
00:16:26,160 --> 00:16:30,300
The real beauty of this technology is it

410
00:16:30,300 --> 00:16:35,340
is effectively a ledger that has a permanent

411
00:16:35,340 --> 00:16:37,580
record of transactions.

412
00:16:40,100 --> 00:16:42,880
Think of- A registry of deeds of

413
00:16:42,880 --> 00:16:43,300
sorts.

414
00:16:43,480 --> 00:16:44,460
Effectively, yeah.

415
00:16:44,800 --> 00:16:49,780
Or with stocks, the transfer agent keeps a

416
00:16:49,780 --> 00:16:50,980
record of who owns stocks.

417
00:16:50,980 --> 00:16:53,260
Who gets what shares, where do those shares

418
00:16:53,260 --> 00:16:53,520
go?

419
00:16:53,620 --> 00:16:54,520
And who gets the dividend.

420
00:16:55,260 --> 00:16:58,440
So we're keeping these kinds of records on

421
00:16:58,440 --> 00:16:58,780
paper.

422
00:16:59,460 --> 00:17:02,140
We can keep these kinds of records on

423
00:17:02,140 --> 00:17:05,819
a blockchain that can be anonymized.

424
00:17:06,520 --> 00:17:09,140
So if you're looking for privacy, there's a

425
00:17:09,140 --> 00:17:10,800
way to do it so that- If

426
00:17:10,800 --> 00:17:12,140
a number represents it instead of- A

427
00:17:12,140 --> 00:17:13,619
number represents you, right.

428
00:17:13,960 --> 00:17:17,780
And that number is frequently referred to as

429
00:17:17,780 --> 00:17:18,520
a wallet.

430
00:17:19,280 --> 00:17:22,060
So I keep my cryptocurrency in a wallet,

431
00:17:22,140 --> 00:17:24,020
like I keep my dollar bills in the

432
00:17:24,020 --> 00:17:25,099
wallet in my back pocket.

433
00:17:25,859 --> 00:17:31,380
And the wallet has an identifying number that

434
00:17:31,380 --> 00:17:33,520
says, that wallet belongs to me.

435
00:17:34,180 --> 00:17:36,040
That sounds scary if I were to have

436
00:17:36,040 --> 00:17:39,640
my estate plan somehow anonymized in the sense

437
00:17:39,640 --> 00:17:42,920
of this wallet because people get concerned.

438
00:17:43,140 --> 00:17:45,520
I've heard stories about wallets being lost.

439
00:17:45,800 --> 00:17:46,000
Right.

440
00:17:46,340 --> 00:17:49,880
And in the case of cryptocurrency, the access

441
00:17:49,880 --> 00:17:52,660
to their wealth that's tied to that cryptocurrency,

442
00:17:53,340 --> 00:17:54,940
inaccessible.

443
00:17:55,980 --> 00:17:59,380
Is this something that is typically expected, the

444
00:17:59,380 --> 00:18:01,220
idea, not the loss of that, but the

445
00:18:01,220 --> 00:18:06,180
idea of anonymizing one's wealth that is essentially

446
00:18:06,180 --> 00:18:08,140
tied to the blockchain?

447
00:18:09,900 --> 00:18:14,080
I think the ability to keep it anonymous

448
00:18:14,080 --> 00:18:16,200
if somebody wants that is desirable.

449
00:18:16,460 --> 00:18:18,300
A lot of people like the idea of

450
00:18:18,300 --> 00:18:18,740
privacy.

451
00:18:18,880 --> 00:18:20,460
In fact, that's one of the reasons many

452
00:18:20,460 --> 00:18:23,400
people choose to have a revocable trust over

453
00:18:23,400 --> 00:18:24,260
using a will.

454
00:18:24,720 --> 00:18:27,040
A will becomes a matter of public record.

455
00:18:27,500 --> 00:18:29,600
The assets going through the estate can become

456
00:18:29,600 --> 00:18:30,780
a matter of public record.

457
00:18:31,460 --> 00:18:35,080
And that loss of privacy is undesirable to

458
00:18:35,080 --> 00:18:35,760
most families.

459
00:18:35,920 --> 00:18:37,580
You don't want the nosy neighbor next door

460
00:18:37,580 --> 00:18:38,900
being able to just run down to the

461
00:18:38,900 --> 00:18:40,400
probate court and say, hey, I'd like to

462
00:18:40,400 --> 00:18:44,780
see the probate estate for Jacqueline open it

463
00:18:44,780 --> 00:18:44,960
up.

464
00:18:45,040 --> 00:18:47,420
And there's all her financial affairs right there

465
00:18:47,420 --> 00:18:48,120
in black and white.

466
00:18:48,460 --> 00:18:51,320
So a trust helps avoid that.

467
00:18:52,420 --> 00:18:56,700
We can use blockchain technology to do the

468
00:18:56,700 --> 00:18:58,520
same kind of a thing, to keep things

469
00:18:58,520 --> 00:19:02,020
private, to say, hey, I have a desire

470
00:19:02,020 --> 00:19:04,880
to give my stuff to this person or

471
00:19:04,880 --> 00:19:05,580
that person.

472
00:19:05,720 --> 00:19:07,260
And I don't need anybody else to know

473
00:19:07,260 --> 00:19:08,080
who's getting it.

474
00:19:08,360 --> 00:19:11,380
Now, that doesn't eliminate the need to file

475
00:19:11,380 --> 00:19:14,440
estate tax returns and disclose information to government

476
00:19:14,440 --> 00:19:16,140
entities when we're required to.

477
00:19:16,400 --> 00:19:19,380
It simply means that it's not necessarily going

478
00:19:19,380 --> 00:19:20,840
to be a matter of public record.

479
00:19:21,320 --> 00:19:23,920
And it's something that we can structure in

480
00:19:23,920 --> 00:19:25,860
a way that maintains family privacy.

481
00:19:26,400 --> 00:19:28,420
No doubt people might hear this and say,

482
00:19:28,580 --> 00:19:30,680
well, why would I want to do this?

483
00:19:31,040 --> 00:19:33,040
Why would I want, instead of a more

484
00:19:33,040 --> 00:19:37,820
traditional means of transferring wealth from one generation

485
00:19:37,820 --> 00:19:40,780
to the next or whatever, tell about the

486
00:19:40,780 --> 00:19:42,360
virtues of why this is designed.

487
00:19:42,700 --> 00:19:45,100
So traditionally, when we use a will-based

488
00:19:45,100 --> 00:19:48,140
estate plan, a probate's going to last anywhere

489
00:19:48,140 --> 00:19:49,600
from a year to a year and a

490
00:19:49,600 --> 00:19:49,900
half.

491
00:19:50,600 --> 00:19:55,460
In Massachusetts, one year is mandated by statute.

492
00:19:55,940 --> 00:19:58,860
We can't close a regular probate until that

493
00:19:58,860 --> 00:20:00,100
one-year timeframe is over.

494
00:20:00,660 --> 00:20:04,060
So we've baked into the cake a delay

495
00:20:04,060 --> 00:20:05,480
for your family to get their money.

496
00:20:06,540 --> 00:20:10,340
If we use a revocable trust, we're often

497
00:20:10,340 --> 00:20:12,160
dealing with a similar delay.

498
00:20:12,480 --> 00:20:14,920
Now, if it's a smaller estate where there's

499
00:20:14,920 --> 00:20:18,100
no estate tax return required, sometimes we can

500
00:20:18,100 --> 00:20:19,980
wrap those up relatively quickly.

501
00:20:20,720 --> 00:20:22,360
I'm going to say six months.

502
00:20:23,400 --> 00:20:24,940
But that's still a delay.

503
00:20:25,900 --> 00:20:29,780
Wouldn't you like a system where within 30

504
00:20:29,780 --> 00:20:32,540
days, everybody can get whatever they're entitled to?

505
00:20:32,640 --> 00:20:35,060
Quite frankly, we could make it virtually instantly

506
00:20:35,060 --> 00:20:40,080
once certain criteria are met, that wealth could

507
00:20:40,080 --> 00:20:44,180
transfer from the deceased to the heirs, lickety

508
00:20:44,180 --> 00:20:44,580
-split.

509
00:20:46,180 --> 00:20:48,460
But I think it would be wise to

510
00:20:48,460 --> 00:20:50,120
put a little bit of a delay in

511
00:20:50,120 --> 00:20:52,020
there so the system that we're building has

512
00:20:52,020 --> 00:20:55,980
a 30-day delay, so that if there

513
00:20:55,980 --> 00:20:59,080
is fraud, we have a way of stopping

514
00:20:59,080 --> 00:21:02,740
the transfer to someone who's not supposed to

515
00:21:02,740 --> 00:21:03,360
receive advance.

516
00:21:03,720 --> 00:21:06,520
So we've built a 30-day delay in

517
00:21:06,520 --> 00:21:09,980
there, but it could be instantaneous that estate

518
00:21:09,980 --> 00:21:12,700
taxes are calculated and paid, income taxes are

519
00:21:12,700 --> 00:21:14,960
calculated and paid, debts of the decedent are

520
00:21:14,960 --> 00:21:17,780
calculated and paid, and the heirs get their

521
00:21:17,780 --> 00:21:20,340
wealth, perhaps with a small reserve, and then

522
00:21:20,340 --> 00:21:21,500
we go from there.

523
00:21:22,820 --> 00:21:26,040
So speed is the big advantage here, but

524
00:21:26,040 --> 00:21:27,440
it's not the only advantage.

525
00:21:27,620 --> 00:21:28,560
I thought that was one of the reasons

526
00:21:28,560 --> 00:21:29,900
I used a trust.

527
00:21:31,540 --> 00:21:35,240
Doesn't that happen faster than a probate?

528
00:21:35,820 --> 00:21:38,040
Yes, but the difference is this.

529
00:21:38,220 --> 00:21:41,660
So once a death occurs with a trust,

530
00:21:41,980 --> 00:21:45,100
the new beneficiaries, the kids, step up into

531
00:21:45,100 --> 00:21:47,080
the place to be the beneficiary, so they're

532
00:21:47,080 --> 00:21:49,440
able to have access to things.

533
00:21:50,240 --> 00:21:53,760
But the reality is, when we're settling an

534
00:21:53,760 --> 00:21:55,800
estate, there's really five steps that we're going

535
00:21:55,800 --> 00:21:56,280
to go through.

536
00:21:56,820 --> 00:21:58,380
We have to take an inventory.

537
00:21:59,260 --> 00:22:00,340
What did somebody know?

538
00:22:01,060 --> 00:22:02,380
I'm sorry, what did somebody own?

539
00:22:04,080 --> 00:22:08,440
With blockchain technology, that's already on record, so

540
00:22:08,440 --> 00:22:10,780
we don't have to do a new inventory.

541
00:22:11,320 --> 00:22:14,160
So if there was something that wasn't recorded

542
00:22:14,160 --> 00:22:16,080
as part of the blockchain, then that still

543
00:22:16,080 --> 00:22:17,640
remains a probate issue.

544
00:22:18,000 --> 00:22:20,320
Or some other method of passing wealth.

545
00:22:20,320 --> 00:22:23,160
But if it's on there, it could be

546
00:22:23,160 --> 00:22:23,560
instant.

547
00:22:23,880 --> 00:22:25,020
We have to get appraisals.

548
00:22:25,160 --> 00:22:25,820
What was it worth?

549
00:22:28,020 --> 00:22:30,600
Well, real estate, we have to go out

550
00:22:30,600 --> 00:22:31,520
and get a paid appraisal.

551
00:22:31,700 --> 00:22:32,840
It slows things down a little bit.

552
00:22:32,940 --> 00:22:34,580
That can take several weeks to get.

553
00:22:35,440 --> 00:22:40,320
If it's stocks, there's a process for that,

554
00:22:40,600 --> 00:22:43,600
but basically, the day after that, information is

555
00:22:43,600 --> 00:22:44,020
available.

556
00:22:44,900 --> 00:22:47,040
So there's a number of steps that need

557
00:22:47,040 --> 00:22:47,560
to be taken.

558
00:22:48,440 --> 00:22:50,440
Inventory appraise, we got to retitle, take the

559
00:22:50,440 --> 00:22:54,460
decedent's name off, transfer to the successor trustee

560
00:22:54,460 --> 00:22:56,240
who will eventually transfer to the heirs.

561
00:22:56,600 --> 00:22:58,700
We have to pay taxes, income taxes, and

562
00:22:58,700 --> 00:23:00,860
estate taxes, and then we divide and distribute.

563
00:23:01,440 --> 00:23:03,520
And to get through that process, if an

564
00:23:03,520 --> 00:23:05,680
estate tax return is required, we're probably going

565
00:23:05,680 --> 00:23:07,200
to be nine months to a year.

566
00:23:08,980 --> 00:23:11,500
So even with a trust, we're not going

567
00:23:11,500 --> 00:23:13,610
to get through the steps until we've done

568
00:23:13,610 --> 00:23:15,310
all those things.

569
00:23:16,070 --> 00:23:18,550
And it takes time to file the estate

570
00:23:18,550 --> 00:23:20,530
tax return, gather the data, fill out the

571
00:23:20,530 --> 00:23:20,830
form.

572
00:23:22,090 --> 00:23:24,870
Now we're reaching a point where much of

573
00:23:24,870 --> 00:23:28,190
that can be done through automation and can

574
00:23:28,190 --> 00:23:31,770
be tied to blockchain technologies to value and

575
00:23:31,770 --> 00:23:32,370
distribute.

576
00:23:33,430 --> 00:23:37,630
Kate, sometimes when someone passes and they've kept

577
00:23:37,630 --> 00:23:42,010
their estate planning private, meaning just themselves sometimes,

578
00:23:42,170 --> 00:23:46,110
and they're an attorney, sometimes documents aren't readily

579
00:23:46,110 --> 00:23:46,610
available.

580
00:23:46,870 --> 00:23:47,930
No one knows where they are.

581
00:23:48,070 --> 00:23:50,490
There's issues of, well, there's two sets of

582
00:23:50,490 --> 00:23:53,210
documents, or there was a new set assigned,

583
00:23:53,410 --> 00:23:55,010
all these things that you deal with every

584
00:23:55,010 --> 00:23:55,290
day.

585
00:23:56,050 --> 00:23:58,770
I know the blockchain, you say the blockchain

586
00:23:58,770 --> 00:24:02,510
is private, but would it, in this example,

587
00:24:02,770 --> 00:24:05,550
if this individual put it in the blockchain,

588
00:24:05,950 --> 00:24:09,330
would the blockchain be searchable to see?

589
00:24:09,330 --> 00:24:10,150
Yeah.

590
00:24:10,210 --> 00:24:12,350
Did Mr. Jones have an estate plan or

591
00:24:12,350 --> 00:24:13,550
some documents on the blockchain?

592
00:24:14,310 --> 00:24:16,290
There would be a couple of ways of

593
00:24:16,290 --> 00:24:17,030
dealing with that.

594
00:24:17,210 --> 00:24:21,150
So typically documents like wills or trust could

595
00:24:21,150 --> 00:24:23,930
be converted to a non-fungible token, a

596
00:24:23,930 --> 00:24:26,770
digital representation of the document, and that would

597
00:24:26,770 --> 00:24:28,990
be recorded somewhere on the blockchain so that

598
00:24:28,990 --> 00:24:30,130
there'll be access to it.

599
00:24:30,270 --> 00:24:31,430
It would be determinable.

600
00:24:31,990 --> 00:24:35,430
You'd probably need to know the wallet information.

601
00:24:35,830 --> 00:24:38,850
But again, assuming the family has some information

602
00:24:38,850 --> 00:24:42,270
about the wallet or the drafting attorney who

603
00:24:42,270 --> 00:24:45,450
assisted with this would have that information, then

604
00:24:45,450 --> 00:24:47,450
you'd be able to identify it quickly and

605
00:24:47,450 --> 00:24:52,270
get the NFT available to show what the

606
00:24:52,270 --> 00:24:53,370
plan actually was.

607
00:24:54,150 --> 00:24:56,170
So that's a benefit in itself.

608
00:24:56,390 --> 00:24:57,210
Right, right.

609
00:24:57,410 --> 00:25:01,810
You talked about calculated and paid, right?

610
00:25:01,930 --> 00:25:02,110
Yeah.

611
00:25:02,110 --> 00:25:06,170
You said things like an estate tax or

612
00:25:06,170 --> 00:25:06,490
whatever.

613
00:25:10,430 --> 00:25:13,870
Part of what was the delay in the

614
00:25:13,870 --> 00:25:18,690
regular current process in a trust, for example,

615
00:25:19,630 --> 00:25:23,130
is the notion of valuations.

616
00:25:24,150 --> 00:25:26,490
What's my real estate worth?

617
00:25:28,090 --> 00:25:31,890
And that often requires an appraisal for me

618
00:25:31,890 --> 00:25:32,970
to get a calculation.

619
00:25:33,670 --> 00:25:36,770
There's a delay in that process.

620
00:25:37,110 --> 00:25:40,630
How will you navigate that kind of an

621
00:25:40,630 --> 00:25:44,830
issue with the notion of that transference, that

622
00:25:44,830 --> 00:25:47,350
conveyance of transfer of ownership?

623
00:25:47,350 --> 00:25:49,050
There's a couple of ways.

624
00:25:49,990 --> 00:25:51,530
Some of them are available.

625
00:25:51,970 --> 00:25:53,910
Some of them aren't yet, but will be

626
00:25:53,910 --> 00:25:55,590
in the not too distant future.

627
00:25:57,550 --> 00:26:01,670
With the advent of AI, it is very

628
00:26:02,870 --> 00:26:06,870
possible to create an AI agent that will

629
00:26:06,870 --> 00:26:09,450
be able to do an appraisal.

630
00:26:09,930 --> 00:26:11,670
You just need to go out and find

631
00:26:11,670 --> 00:26:12,250
the comps.

632
00:26:13,010 --> 00:26:17,410
And so the technology isn't there yet, but

633
00:26:17,410 --> 00:26:19,370
it's probably right on the horizon.

634
00:26:21,130 --> 00:26:28,450
The other option would be to memorialize the

635
00:26:28,450 --> 00:26:31,490
real estate ownership as a non-fungible token.

636
00:26:32,350 --> 00:26:35,570
There are some technologies out there that do

637
00:26:35,570 --> 00:26:36,970
this with stocks right now.

638
00:26:37,630 --> 00:26:40,290
And you could then see what that NFT

639
00:26:40,290 --> 00:26:44,730
is trading at as it's assessed value in

640
00:26:44,730 --> 00:26:45,230
a sense.

641
00:26:45,610 --> 00:26:51,490
So if I understand that correctly, essentially I

642
00:26:51,490 --> 00:26:55,090
would say the ownership of my property that

643
00:26:55,090 --> 00:26:58,370
I own here now is connected to this

644
00:26:58,370 --> 00:26:59,690
non-fungible token.

645
00:27:00,190 --> 00:27:04,110
And if I wanted to transfer the ownership

646
00:27:04,110 --> 00:27:06,850
of that, I would be selling in effect

647
00:27:06,850 --> 00:27:10,570
this non-fungible token which owns this real

648
00:27:10,570 --> 00:27:14,470
estate as a means of transferring ownership.

649
00:27:15,250 --> 00:27:20,090
And therefore, there's a potential for a market

650
00:27:20,090 --> 00:27:22,230
of sorts for assets like that.

651
00:27:23,090 --> 00:27:24,690
And you think that's likely to be the

652
00:27:24,690 --> 00:27:27,310
way some of this is happening in the

653
00:27:27,310 --> 00:27:28,350
not too distant future.

654
00:27:28,550 --> 00:27:28,710
Yes.

655
00:27:29,270 --> 00:27:29,490
Okay.

656
00:27:30,150 --> 00:27:30,930
And very interesting.

657
00:27:31,130 --> 00:27:31,570
Very interesting.

658
00:27:32,110 --> 00:27:32,290
Yeah.

659
00:27:32,450 --> 00:27:36,010
So the question is going to be, where

660
00:27:36,010 --> 00:27:38,590
do you want record of your real estate

661
00:27:38,590 --> 00:27:40,450
ownership to be at the county registry of

662
00:27:40,450 --> 00:27:42,830
deeds and books and pages on paper?

663
00:27:43,230 --> 00:27:45,550
Or do you want it to be more

664
00:27:45,550 --> 00:27:48,830
digital and there's going to be a competitive

665
00:27:48,830 --> 00:27:54,250
alternative solution for real estate for stocks and

666
00:27:54,250 --> 00:27:56,230
bonds instead of transfer agents?

667
00:27:56,230 --> 00:27:59,850
Well, I bet you could name dozens of

668
00:27:59,850 --> 00:28:02,830
heirs that you are working with after the

669
00:28:02,830 --> 00:28:07,710
passing of their parents who presently expect this

670
00:28:07,710 --> 00:28:08,910
to be like, aren't we done?

671
00:28:08,990 --> 00:28:09,670
It's been a month.

672
00:28:10,050 --> 00:28:10,150
Yeah.

673
00:28:10,230 --> 00:28:12,950
Like every one of them, probably.

674
00:28:14,650 --> 00:28:17,970
And so the idea of moving this process

675
00:28:17,970 --> 00:28:22,870
to something more efficient, let's call it, would

676
00:28:22,870 --> 00:28:27,410
have great appeal if you're maybe automating, for

677
00:28:27,410 --> 00:28:29,770
lack of a better term, some of the

678
00:28:29,770 --> 00:28:32,530
process of how is this accomplished?

679
00:28:32,750 --> 00:28:32,850
Right.

680
00:28:34,450 --> 00:28:35,670
Sounds pretty appealing.

681
00:28:36,090 --> 00:28:36,210
Right.

682
00:28:36,450 --> 00:28:36,670
Right.

683
00:28:37,050 --> 00:28:38,330
So now this...

684
00:28:38,330 --> 00:28:38,430
All right.

685
00:28:38,450 --> 00:28:40,470
So I'm someone who says, oh, this sounds

686
00:28:40,470 --> 00:28:40,830
interesting.

687
00:28:40,910 --> 00:28:41,850
I should do this.

688
00:28:42,730 --> 00:28:44,230
Is this doable today?

689
00:28:45,170 --> 00:28:46,390
We're on the cusp.

690
00:28:46,810 --> 00:28:51,690
We've submitted a patent for this process for

691
00:28:51,690 --> 00:28:53,690
what we're calling the Wealth Blockchain.

692
00:28:55,350 --> 00:28:57,010
So we're technically patent pending.

693
00:28:57,510 --> 00:28:58,990
Takes a little bit of time for that

694
00:28:58,990 --> 00:29:00,390
patent to come through.

695
00:29:02,530 --> 00:29:07,970
As far as the technology is concerned, we're

696
00:29:07,970 --> 00:29:12,270
probably about a month out from starting testing

697
00:29:12,270 --> 00:29:15,470
of transfers, artificial transfers.

698
00:29:16,430 --> 00:29:18,810
Should I think in terms of, hey, a

699
00:29:18,810 --> 00:29:19,990
year from now, this is going to be

700
00:29:19,990 --> 00:29:22,530
very different, or is it six months?

701
00:29:22,650 --> 00:29:23,650
Is it 10 years?

702
00:29:23,730 --> 00:29:25,270
I think we're hoping to be...

703
00:29:25,270 --> 00:29:26,750
How quickly is this going to impact people?

704
00:29:26,750 --> 00:29:29,330
We're hoping to be live before the beginning

705
00:29:29,330 --> 00:29:29,730
of the year.

706
00:29:30,330 --> 00:29:30,510
Wow.

707
00:29:31,590 --> 00:29:33,070
So do you think...

708
00:29:33,070 --> 00:29:35,550
Now, most of our clientele and I know

709
00:29:35,550 --> 00:29:37,730
most of your clientele tend to be people

710
00:29:37,730 --> 00:29:42,010
who are in retirement, maybe an older set

711
00:29:42,010 --> 00:29:44,410
who are maybe a little more skeptical of

712
00:29:44,410 --> 00:29:45,930
this technology.

713
00:29:46,250 --> 00:29:47,170
It's unfamiliar.

714
00:29:48,490 --> 00:29:51,890
Who's the target audience for this kind of

715
00:29:51,890 --> 00:29:52,690
planning?

716
00:29:53,090 --> 00:29:55,610
Initially, the people who will be the first

717
00:29:55,610 --> 00:29:57,990
adopters of this approach will be people who

718
00:29:57,990 --> 00:29:59,770
are already active in the crypto field.

719
00:30:00,070 --> 00:30:03,190
Kind of cryptocurrency, familiar with blockchain technology already

720
00:30:03,190 --> 00:30:03,990
to some extent.

721
00:30:03,990 --> 00:30:05,990
They'll get it and they'll understand the application,

722
00:30:06,510 --> 00:30:08,990
and so they'll be ready to adopt this

723
00:30:08,990 --> 00:30:10,030
relatively quickly.

724
00:30:10,850 --> 00:30:13,590
I think the next step for more broad

725
00:30:13,590 --> 00:30:17,050
adoption will be a hybrid approach where we

726
00:30:17,050 --> 00:30:20,650
still have traditional estate planning documents that control

727
00:30:20,650 --> 00:30:23,250
some of the assets, and we digitize other

728
00:30:23,250 --> 00:30:25,410
portions of the estate to be controlled by

729
00:30:25,410 --> 00:30:27,050
blockchain while transfer process.

730
00:30:28,130 --> 00:30:30,210
So that will probably be the next stage.

731
00:30:30,450 --> 00:30:32,830
And with final adoption, I'd say within five

732
00:30:32,830 --> 00:30:35,350
years, this could replace traditional estate planning.

733
00:30:35,790 --> 00:30:36,190
Really interesting.

734
00:30:36,430 --> 00:30:39,130
I wanted to ask you about another element

735
00:30:39,130 --> 00:30:40,690
of this, and that is when we talk

736
00:30:40,690 --> 00:30:43,710
about trust, typically we kind of hit a

737
00:30:43,710 --> 00:30:45,870
fork in the road, and we think in

738
00:30:45,870 --> 00:30:48,210
terms of two different approaches to the estate

739
00:30:48,210 --> 00:30:48,490
planning.

740
00:30:48,630 --> 00:30:52,510
One that's intended to shelter wealth that is

741
00:30:52,510 --> 00:30:58,090
essentially giving it away prematurely before I have

742
00:30:58,090 --> 00:31:00,850
a long-term care event, a Medicaid need,

743
00:31:00,870 --> 00:31:05,790
and where that might take it out of

744
00:31:05,790 --> 00:31:06,690
my access.

745
00:31:07,530 --> 00:31:10,430
And one that's more designed to plan for

746
00:31:10,430 --> 00:31:13,450
taxation and some of the kind of things

747
00:31:13,450 --> 00:31:14,570
you were talking about earlier.

748
00:31:15,930 --> 00:31:20,770
How does this technology fit into the prism

749
00:31:20,770 --> 00:31:21,870
of this kind of approach?

750
00:31:22,030 --> 00:31:22,970
In order to answer that, I have to

751
00:31:22,970 --> 00:31:24,830
step back for a second just to explain

752
00:31:24,830 --> 00:31:26,430
kind of some of what we're doing with

753
00:31:26,430 --> 00:31:27,070
the technology.

754
00:31:27,070 --> 00:31:28,270
All right.

755
00:31:28,430 --> 00:31:32,750
So when you look at a trust, that

756
00:31:32,750 --> 00:31:35,510
is essentially a contract, an agreement amongst three

757
00:31:35,510 --> 00:31:35,930
parties.

758
00:31:36,090 --> 00:31:37,910
The person who's making the trust, the donor,

759
00:31:38,210 --> 00:31:41,730
settler, grantor, trustee, trustor, whoever, whatever terminology you

760
00:31:41,730 --> 00:31:42,030
want to use.

761
00:31:42,530 --> 00:31:44,750
The person who will manage the assets that

762
00:31:44,750 --> 00:31:47,490
are owned by the trust, a trustee, and

763
00:31:47,490 --> 00:31:49,210
the person who gets to use and enjoy

764
00:31:49,210 --> 00:31:50,550
the assets, the beneficiary.

765
00:31:50,550 --> 00:31:50,970
Yes.

766
00:31:51,830 --> 00:31:55,010
Will's technically aren't necessarily contracts, but they are

767
00:31:55,010 --> 00:31:56,970
contractual in nature as well.

768
00:31:57,370 --> 00:31:59,330
I'm going to put down on paper who's

769
00:31:59,330 --> 00:32:00,650
going to get my stuff when I die,

770
00:32:00,710 --> 00:32:02,870
and my executor's going to oversee it and

771
00:32:02,870 --> 00:32:03,450
make sure it happens.

772
00:32:03,450 --> 00:32:05,150
But the court has to approve the process,

773
00:32:05,330 --> 00:32:06,450
which is kind of the difference.

774
00:32:06,590 --> 00:32:06,750
Right.

775
00:32:07,030 --> 00:32:07,290
Okay.

776
00:32:07,930 --> 00:32:10,690
So what we're doing with this technology is

777
00:32:10,690 --> 00:32:12,770
recognizing the fact that there is something called

778
00:32:12,770 --> 00:32:15,790
a smart contract in certain portions of the

779
00:32:15,790 --> 00:32:16,570
blockchain world.

780
00:32:17,330 --> 00:32:20,770
Ethereum initially, Solana is another one that you

781
00:32:20,770 --> 00:32:25,350
can put an agreement that says- If

782
00:32:25,350 --> 00:32:26,130
this, then that.

783
00:32:26,290 --> 00:32:26,410
Right.

784
00:32:26,610 --> 00:32:26,790
Yeah.

785
00:32:27,030 --> 00:32:27,130
Basically.

786
00:32:28,530 --> 00:32:30,970
My wallet is going to transfer X amount

787
00:32:30,970 --> 00:32:35,550
of Ethereum because Joe Blow mows my lawn.

788
00:32:36,790 --> 00:32:39,910
And when the certification comes through that he's

789
00:32:39,910 --> 00:32:41,990
completed the job, go ahead and move the

790
00:32:41,990 --> 00:32:44,690
Ethereum from my wallet to Joe Blow's wallet.

791
00:32:45,850 --> 00:32:48,750
Well, that's a trust by another name, effectively.

792
00:32:49,030 --> 00:32:52,030
It's a contract to transfer wealth from one

793
00:32:52,030 --> 00:32:54,630
person to another when a certain event occurs,

794
00:32:54,710 --> 00:32:57,390
in this case, a death, or can transfer

795
00:32:57,390 --> 00:33:01,530
control from the owner to the next person

796
00:33:01,530 --> 00:33:02,690
who's going to be in control if there's

797
00:33:02,690 --> 00:33:03,350
an incapacity.

798
00:33:04,270 --> 00:33:08,170
So we can put certifications onto the blockchain,

799
00:33:08,530 --> 00:33:11,370
an affidavit through an NFT that says the

800
00:33:11,370 --> 00:33:12,110
person has died.

801
00:33:12,250 --> 00:33:13,650
Here's a copy of the death certificate.

802
00:33:13,910 --> 00:33:15,990
We can verify that through records, through social

803
00:33:15,990 --> 00:33:18,590
security administration, for example, to show that yes,

804
00:33:18,670 --> 00:33:20,530
social security shows the person has passed away.

805
00:33:20,870 --> 00:33:22,650
So we come at it from multiple sources

806
00:33:22,650 --> 00:33:24,710
to confirm that the death has occurred.

807
00:33:24,950 --> 00:33:26,750
And now we know, okay, it's okay to

808
00:33:26,750 --> 00:33:29,410
transfer the wealth from the first person to

809
00:33:29,410 --> 00:33:30,170
the second person.

810
00:33:30,650 --> 00:33:30,890
Okay.

811
00:33:31,770 --> 00:33:34,330
Again, we're going to build this with similar

812
00:33:34,330 --> 00:33:37,130
types of trust feel to it.

813
00:33:38,590 --> 00:33:41,890
We can make it a smart will.

814
00:33:42,190 --> 00:33:44,890
When I die as certified by a couple

815
00:33:44,890 --> 00:33:47,030
of instances, then take my stuff and give

816
00:33:47,030 --> 00:33:49,970
it to so-and-so, my spouse, my

817
00:33:49,970 --> 00:33:51,470
kids, my favorite charity.

818
00:33:51,990 --> 00:33:52,230
Okay.

819
00:33:52,410 --> 00:33:54,330
And then the wealth is transferred to the

820
00:33:54,330 --> 00:33:55,850
ultimate beneficiary and it's done.

821
00:33:56,330 --> 00:33:59,010
We can build it like a trust that

822
00:33:59,010 --> 00:34:00,370
is for someone.

823
00:34:01,010 --> 00:34:03,110
Give it to a wallet that is managed

824
00:34:03,110 --> 00:34:06,150
by a trustee for the benefit of the

825
00:34:06,150 --> 00:34:07,190
ultimate beneficiary.

826
00:34:07,570 --> 00:34:09,909
And the trustee will decide how to dish

827
00:34:09,909 --> 00:34:12,389
it out to that beneficiary based on pre

828
00:34:12,389 --> 00:34:14,469
-designed parameters.

829
00:34:15,150 --> 00:34:17,590
You can say, give them the income every

830
00:34:17,590 --> 00:34:18,010
month.

831
00:34:18,489 --> 00:34:21,050
Give them principal for health education, maintenance, and

832
00:34:21,050 --> 00:34:21,429
support.

833
00:34:21,870 --> 00:34:24,030
Give them principal at your discretion.

834
00:34:24,690 --> 00:34:27,449
And again, the trustee in that situation, it'll

835
00:34:27,449 --> 00:34:29,409
move from the wallet of the deceased to

836
00:34:29,409 --> 00:34:31,370
a wallet of the trustee who will hold

837
00:34:31,370 --> 00:34:34,449
it in trust for the ultimate beneficiary, much

838
00:34:34,449 --> 00:34:36,449
like a revocable trust does now, but it

839
00:34:36,449 --> 00:34:40,030
happens automatically because it's on this blockchain technology.

840
00:34:41,750 --> 00:34:45,130
It is possible to let the smart contract

841
00:34:45,130 --> 00:34:51,409
act like the trustee itself to actually dish

842
00:34:51,409 --> 00:34:52,010
things out.

843
00:34:52,310 --> 00:34:52,810
Make decisions.

844
00:34:53,350 --> 00:34:53,790
Make decisions.

845
00:34:54,030 --> 00:34:54,190
Yeah.

846
00:34:54,350 --> 00:34:56,710
As to when to distribute on certain, again,

847
00:34:56,890 --> 00:35:01,270
certain parameters that are predefined and recorded on

848
00:35:01,270 --> 00:35:01,650
the blockchain.

849
00:35:01,950 --> 00:35:03,390
What if we haven't thought of something?

850
00:35:06,010 --> 00:35:08,690
And that's where there are safety nets that

851
00:35:08,690 --> 00:35:09,390
you can put in.

852
00:35:09,570 --> 00:35:13,550
I mentioned a decentralized autonomous organization a few

853
00:35:13,550 --> 00:35:14,070
moments ago.

854
00:35:14,870 --> 00:35:16,810
Initially, that's going to be the easy way

855
00:35:16,810 --> 00:35:17,910
to accomplish this.

856
00:35:18,030 --> 00:35:21,230
You put your assets into a business entity,

857
00:35:21,870 --> 00:35:22,530
a DAO.

858
00:35:22,990 --> 00:35:26,390
You have the DAO subject to the contract.

859
00:35:26,510 --> 00:35:29,770
Well, now the DAO ownership changes, but so

860
00:35:29,770 --> 00:35:32,230
does the assets owned by the DAO.

861
00:35:33,650 --> 00:35:36,130
You can use an LLC the same way

862
00:35:36,130 --> 00:35:37,830
if you don't want it to be totally

863
00:35:37,830 --> 00:35:42,050
blockchain oriented and it transfers from the ownership

864
00:35:42,050 --> 00:35:45,730
of the membership of the LLC transfers at

865
00:35:45,730 --> 00:35:48,510
death from one person, one wallet to another

866
00:35:48,510 --> 00:35:48,890
wallet.

867
00:35:49,630 --> 00:35:52,650
And that manager of that LLC can act

868
00:35:52,650 --> 00:35:54,530
like the trustee to distribute out to the

869
00:35:54,530 --> 00:35:55,030
beneficiaries.

870
00:35:55,810 --> 00:35:58,510
A DAO basically allows the various owners to

871
00:35:58,510 --> 00:35:59,430
vote on things.

872
00:35:59,610 --> 00:36:03,130
And so it's managed in a more flexible

873
00:36:03,130 --> 00:36:07,990
nature because the owners can take into account

874
00:36:07,990 --> 00:36:09,610
things that we don't consider today.

875
00:36:09,910 --> 00:36:14,870
So they can vote on liquidating the DAO

876
00:36:14,870 --> 00:36:16,450
if it makes more sense to do that.

877
00:36:16,610 --> 00:36:19,810
They can vote on making partial distributions because

878
00:36:19,810 --> 00:36:21,770
there's a need for one person to get

879
00:36:21,770 --> 00:36:22,230
some money.

880
00:36:22,330 --> 00:36:25,430
They can vote on changing the investment structure

881
00:36:25,430 --> 00:36:28,330
from a stock account to a bond account

882
00:36:28,330 --> 00:36:30,230
or whatever the nature might be.

883
00:36:30,850 --> 00:36:36,010
So it gives more of a democratic management

884
00:36:36,010 --> 00:36:40,490
structure than traditional business entities would provide.

885
00:36:41,450 --> 00:36:41,790
All right.

886
00:36:41,810 --> 00:36:42,710
You got all that, Jeff?

887
00:36:43,430 --> 00:36:45,750
I think my head exploded about five minutes

888
00:36:45,750 --> 00:36:46,450
ago, actually.

889
00:36:46,930 --> 00:36:47,230
I know.

890
00:36:47,370 --> 00:36:48,890
I think I lost him on that last

891
00:36:48,890 --> 00:36:51,310
part of managing the DAO stuff.

892
00:36:52,330 --> 00:36:55,210
So there's obviously a lot of opportunity in

893
00:36:55,210 --> 00:36:58,970
blockchain technology and this is a small piece

894
00:36:58,970 --> 00:36:59,890
of those opportunities.

895
00:37:00,190 --> 00:37:04,070
I think for people maybe my age and

896
00:37:04,070 --> 00:37:07,630
older, they'll have some hesitancy because they don't

897
00:37:07,630 --> 00:37:08,330
understand it.

898
00:37:08,510 --> 00:37:10,610
They don't know how it works.

899
00:37:10,610 --> 00:37:12,270
They can't go into the office and talk

900
00:37:12,270 --> 00:37:12,830
to somebody.

901
00:37:14,370 --> 00:37:15,870
Well, they will be able to.

902
00:37:15,990 --> 00:37:18,050
Part of what we're doing is we're going

903
00:37:18,050 --> 00:37:18,750
to...

904
00:37:18,750 --> 00:37:20,830
So the blockchain, this is really, to me,

905
00:37:20,890 --> 00:37:24,110
it's a two-level approach to address planning.

906
00:37:24,970 --> 00:37:27,790
The first level is the blockchain and the

907
00:37:27,790 --> 00:37:28,510
smart contract.

908
00:37:29,430 --> 00:37:32,870
The second level will be a software application.

909
00:37:34,370 --> 00:37:35,550
For the implementation.

910
00:37:35,990 --> 00:37:36,310
Yeah.

911
00:37:36,630 --> 00:37:38,510
And so most lawyers are not going to

912
00:37:38,510 --> 00:37:39,910
learn how to write a smart contract.

913
00:37:40,630 --> 00:37:42,670
They may know the law, but they're not

914
00:37:42,670 --> 00:37:45,850
going to know the technological programmatic portion of

915
00:37:45,850 --> 00:37:46,110
this.

916
00:37:46,810 --> 00:37:49,810
So a software application that the lawyer can

917
00:37:49,810 --> 00:37:52,210
subscribe to to say, okay, let's build a

918
00:37:52,210 --> 00:37:55,810
smart contract that works like a domestic asset

919
00:37:55,810 --> 00:37:59,310
protection trust or a spousal limited access trust

920
00:37:59,310 --> 00:38:03,550
or a Medicaid planning trust, they'll be predefined.

921
00:38:03,990 --> 00:38:05,910
That goes back to my prior question, I

922
00:38:05,910 --> 00:38:06,430
think, too.

923
00:38:06,670 --> 00:38:09,010
So it's going to come down to the

924
00:38:09,010 --> 00:38:15,430
programming that a legal expert might select as

925
00:38:15,430 --> 00:38:19,390
the mechanism to use to provide the instructions

926
00:38:19,390 --> 00:38:21,690
that are placed into the smart contract.

927
00:38:21,890 --> 00:38:21,990
Right.

928
00:38:22,190 --> 00:38:24,250
And most lawyers right now, when they're doing

929
00:38:24,250 --> 00:38:27,050
estate planning, they use software to build the

930
00:38:27,050 --> 00:38:27,410
trust.

931
00:38:28,450 --> 00:38:30,410
Well, so what we're doing is we're changing

932
00:38:30,410 --> 00:38:32,630
it to be software to build a smart

933
00:38:32,630 --> 00:38:34,690
contract rather than software to build a trust,

934
00:38:34,730 --> 00:38:37,070
but the smart contract replaces the trust.

935
00:38:37,770 --> 00:38:40,770
But it's in many ways going to do

936
00:38:40,770 --> 00:38:42,610
a lot of the same kinds of things.

937
00:38:42,750 --> 00:38:44,630
It's going to act in a similar way.

938
00:38:44,830 --> 00:38:49,110
It's just moving it from paper, if you

939
00:38:49,110 --> 00:38:51,150
will, to digital.

940
00:38:51,510 --> 00:38:55,330
And then the application of the decision making

941
00:38:55,330 --> 00:38:58,270
is more efficient and rapid.

942
00:38:59,350 --> 00:39:00,510
Interesting stuff.

943
00:39:00,510 --> 00:39:04,050
So with every advance comes bad actors looking

944
00:39:04,050 --> 00:39:08,190
to take advantage of technology and try to

945
00:39:08,190 --> 00:39:11,790
figure out how to monetize in a bad

946
00:39:11,790 --> 00:39:12,130
way.

947
00:39:12,310 --> 00:39:16,490
There's been some articles about the increases in

948
00:39:16,490 --> 00:39:20,010
technology regarding quantum computing and whether or not

949
00:39:20,010 --> 00:39:22,350
the ability of quantum computing will be able

950
00:39:22,350 --> 00:39:27,210
to threaten the blockchain and destroy that privacy

951
00:39:27,210 --> 00:39:28,410
or security of it.

952
00:39:29,230 --> 00:39:32,810
How would you respond to someone who's concerned

953
00:39:32,810 --> 00:39:33,630
about that?

954
00:39:34,270 --> 00:39:36,050
We have to be realistic.

955
00:39:36,250 --> 00:39:39,330
There is some risk that basically what blockchain

956
00:39:39,330 --> 00:39:42,150
is built on is the idea that we're

957
00:39:42,150 --> 00:39:45,510
using cryptography to provide security.

958
00:39:47,380 --> 00:39:51,360
As supercomputing comes online, I think it's going

959
00:39:51,360 --> 00:39:52,920
to be a double edged sword.

960
00:39:53,960 --> 00:39:56,600
There will be bad actors out there who

961
00:39:56,600 --> 00:40:00,940
will try to use supercomputing to break the

962
00:40:00,940 --> 00:40:06,820
code, break the cryptography, and therefore gain access

963
00:40:06,820 --> 00:40:07,680
to things.

964
00:40:08,520 --> 00:40:15,140
I think though realistically, the idea of the

965
00:40:15,140 --> 00:40:18,520
cryptography, I'm sorry, cryptotechnology is built on a

966
00:40:18,520 --> 00:40:19,500
peer-to-peer network.

967
00:40:20,440 --> 00:40:23,080
You have a computer that is running programs.

968
00:40:23,320 --> 00:40:24,880
Chris has a computer that's running programs.

969
00:40:24,980 --> 00:40:26,600
I have a computer that's running programs.

970
00:40:27,340 --> 00:40:30,280
There's a thousand of these computers or thousands

971
00:40:30,280 --> 00:40:32,760
of them all over the world running and

972
00:40:32,760 --> 00:40:36,560
trying to break the code and solve a

973
00:40:36,560 --> 00:40:39,720
problem to say, yes, we all agree this

974
00:40:39,720 --> 00:40:40,540
is the answer.

975
00:40:41,240 --> 00:40:44,340
When one bad actor comes in and says,

976
00:40:44,960 --> 00:40:47,200
hey, I've got a different answer, they're going

977
00:40:47,200 --> 00:40:49,360
to get boxed out because they've got the

978
00:40:49,360 --> 00:40:49,960
different answer.

979
00:40:51,580 --> 00:40:52,600
That's part of it.

980
00:40:52,720 --> 00:40:54,980
I think too, the idea of supercomputing is

981
00:40:54,980 --> 00:40:56,940
going to give us an opportunity to develop

982
00:40:56,940 --> 00:41:00,020
the cryptography to a higher level of security.

983
00:41:01,020 --> 00:41:05,880
I think both of these are sides that

984
00:41:05,880 --> 00:41:08,540
will provide adequate protection and comfort to everybody

985
00:41:08,540 --> 00:41:12,640
that eventually once we do have supercomputers online,

986
00:41:12,920 --> 00:41:14,040
we're going to be able to go to

987
00:41:14,040 --> 00:41:16,520
a much, much higher level of security in

988
00:41:16,520 --> 00:41:18,620
blockchain technology than we currently have.

989
00:41:18,640 --> 00:41:20,620
Just as there might be if we're just

990
00:41:20,620 --> 00:41:23,560
looking at it relative to today, that supercomputing

991
00:41:23,560 --> 00:41:26,600
capability might be able to undermine some of

992
00:41:26,600 --> 00:41:27,460
that cryptography.

993
00:41:28,260 --> 00:41:30,560
But if we have the ability to use

994
00:41:30,560 --> 00:41:34,120
that for advancing the cryptography, it will be

995
00:41:34,120 --> 00:41:35,340
a much harder code to break.

996
00:41:36,140 --> 00:41:38,280
Again, then you still have that idea of

997
00:41:38,280 --> 00:41:39,380
the peer-to-peer network.

998
00:41:39,900 --> 00:41:41,800
Just for people who aren't computer geeks like

999
00:41:41,800 --> 00:41:45,200
I guess I am, a peer-to-peer

1000
00:41:45,200 --> 00:41:49,940
network is a network where each computer can

1001
00:41:49,940 --> 00:41:53,400
talk to all the other computers and each

1002
00:41:53,400 --> 00:41:55,680
computer stores all the data on its own

1003
00:41:55,680 --> 00:41:56,220
hard drive.

1004
00:41:57,440 --> 00:42:01,380
Most commercial networks are built differently that there

1005
00:42:01,380 --> 00:42:03,580
is a server that holds all the data

1006
00:42:03,580 --> 00:42:06,680
and all the computers feed onto that server

1007
00:42:06,680 --> 00:42:08,320
and pull the data off, do what they

1008
00:42:08,320 --> 00:42:09,380
want to do and then put the data

1009
00:42:09,380 --> 00:42:09,960
back on.

1010
00:42:10,840 --> 00:42:12,860
Peer-to-peer networks are something that we've

1011
00:42:12,860 --> 00:42:15,280
been working with since we started using networks

1012
00:42:15,280 --> 00:42:17,300
at Boyd & Boyd PC where every computer

1013
00:42:17,300 --> 00:42:19,900
can talk to the other computers and the

1014
00:42:19,900 --> 00:42:22,720
data isn't necessarily stored in one place, it's

1015
00:42:22,720 --> 00:42:24,620
all over the place and that adds added

1016
00:42:24,620 --> 00:42:25,160
security.

1017
00:42:25,620 --> 00:42:28,640
My mind is going back to the music

1018
00:42:28,640 --> 00:42:30,460
shared file program.

1019
00:42:30,680 --> 00:42:31,400
What the heck was that?

1020
00:42:32,160 --> 00:42:36,580
Yeah, that was a peer-to-peer network

1021
00:42:36,580 --> 00:42:39,140
where everybody was sharing their music files, their

1022
00:42:39,140 --> 00:42:40,020
mp3s.

1023
00:42:41,520 --> 00:42:45,000
Granted, it did violate copyright but it was

1024
00:42:45,000 --> 00:42:48,400
conceptual how it works essentially.

1025
00:42:49,980 --> 00:42:52,700
All right, well, we're going to talk to

1026
00:42:52,700 --> 00:42:54,420
you more about this in the future no

1027
00:42:54,420 --> 00:42:56,400
doubt because it sounds like this is just

1028
00:42:56,400 --> 00:43:01,500
at its early stages of adoption and really

1029
00:43:01,500 --> 00:43:03,160
intriguing, interesting stuff.

1030
00:43:03,660 --> 00:43:06,960
In the meantime, don't hesitate to deal with

1031
00:43:06,960 --> 00:43:10,920
your estate plan but be aware that there

1032
00:43:10,920 --> 00:43:16,360
are really interesting possibilities evolving over time and

1033
00:43:16,360 --> 00:43:20,160
may have some impact in the future as

1034
00:43:20,160 --> 00:43:21,120
it relates to this.

1035
00:43:21,300 --> 00:43:23,640
I think for those of families who are

1036
00:43:23,640 --> 00:43:26,180
looking at doing a traditional estate plan and

1037
00:43:26,180 --> 00:43:28,060
saying, well, is this new technology going to

1038
00:43:28,060 --> 00:43:29,500
undo what I just did?

1039
00:43:29,580 --> 00:43:30,220
It's going to be irrelevant.

1040
00:43:30,560 --> 00:43:31,580
No, it's not.

1041
00:43:32,960 --> 00:43:35,140
Will it replace it?

1042
00:43:35,180 --> 00:43:37,860
Maybe someday but I think there will be

1043
00:43:37,860 --> 00:43:39,900
people who will be hesitant to adopt it.

1044
00:43:40,500 --> 00:43:42,260
So over our lifetimes, there's still going to

1045
00:43:42,260 --> 00:43:43,240
be traditional estate planning.

1046
00:43:43,240 --> 00:43:44,600
There's going to be traditional estate planning.

1047
00:43:46,080 --> 00:43:49,260
Once this technology is out there, you may

1048
00:43:49,260 --> 00:43:51,320
be able to hybrid it but if you

1049
00:43:51,320 --> 00:43:53,120
want to just work with your paper documents,

1050
00:43:53,220 --> 00:43:55,280
that's going to work and it works well.

1051
00:43:55,340 --> 00:43:56,080
We know it.

1052
00:43:56,080 --> 00:43:57,760
It's been around since the 1500s.

1053
00:43:58,260 --> 00:43:58,360
Yeah.

1054
00:43:58,700 --> 00:43:58,860
Yeah.

1055
00:43:58,940 --> 00:44:01,780
So again, if you want to learn more

1056
00:44:01,780 --> 00:44:04,040
about those seminar dates, maybe send them to

1057
00:44:04,040 --> 00:44:04,980
a web page.

1058
00:44:05,480 --> 00:44:14,740
It's www.yoursvp.com and there's a code

1059
00:44:14,740 --> 00:44:17,460
you can enter C-E-G-B-U

1060
00:44:17,460 --> 00:44:20,720
-S and or call the office at 508

1061
00:44:20,720 --> 00:44:21,840
-775-7800.

1062
00:44:22,140 --> 00:44:23,260
We hope you can join us for one

1063
00:44:23,260 --> 00:44:23,560
of those.

1064
00:44:23,680 --> 00:44:25,160
We try to share lots of good information.

1065
00:44:25,720 --> 00:44:29,220
We'll include that link in the show notes

1066
00:44:29,220 --> 00:44:30,660
so you'll be able to find that more

1067
00:44:30,660 --> 00:44:30,980
easily.

1068
00:44:31,460 --> 00:44:34,640
And in the meantime, thanks everybody for being

1069
00:44:34,640 --> 00:44:35,740
with us for another show.

1070
00:44:36,320 --> 00:44:39,020
Until next time, keep striving for something more.

1071
00:44:40,660 --> 00:44:42,780
Thank you for listening to Something More with

1072
00:44:42,780 --> 00:44:43,480
Chris Boyd.

1073
00:44:43,800 --> 00:44:45,940
Call us for help, whether it's for financial

1074
00:44:45,940 --> 00:44:49,880
planning or portfolio management, insurance concerns, or those

1075
00:44:49,880 --> 00:44:51,900
quality of life issues that make the money

1076
00:44:51,900 --> 00:44:52,980
matters matter.

1077
00:44:53,340 --> 00:44:56,640
Whatever's on your mind, visit us at somethingmorewithchrisboyd

1078
00:44:56,640 --> 00:44:59,840
.com or call us toll free at 866

1079
00:44:59,840 --> 00:45:05,360
-771-8901, or send us your questions to

1080
00:45:05,360 --> 00:45:09,320
amr-info at wealthenhancement.com.

1081
00:45:09,680 --> 00:45:11,440
You're listening to Something More with Chris Boyd

1082
00:45:11,440 --> 00:45:12,280
Financial Talk Show.

1083
00:45:12,440 --> 00:45:14,880
Wealth Enhancement Advisory Services and Jay Christopher Boyd

1084
00:45:14,880 --> 00:45:17,220
provide investment advice on an individual basis to

1085
00:45:17,220 --> 00:45:17,760
clients only.

1086
00:45:17,920 --> 00:45:19,900
Proper advice depends on a complete analysis of

1087
00:45:19,900 --> 00:45:21,080
all facts and circumstances.

1088
00:45:21,080 --> 00:45:23,200
The information given on this program is general

1089
00:45:23,200 --> 00:45:25,220
financial comments and cannot be relied upon as

1090
00:45:25,220 --> 00:45:26,820
pertaining to your specific situation.

1091
00:45:27,020 --> 00:45:28,980
Wealth Enhancement Group cannot guarantee that using the

1092
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information from this show will generate profits or

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ensure freedom from loss.

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Listeners should consult their own financial advisors or

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conduct their own due diligence before making any

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financial decisions.