Counting Down, Counting Up, Flourishing: Part 4 of 4

“Counting Down, Counting Up, Flourishing,” that’s the subject of today’s ACTEC Trust and Estate Talk.

Counting Down, Counting Up, Flourishing is a four-part special:

• Part 1:  Overview
• Part 2
• Part 3
• Part 4: (this podcast)

DOWNLOAD THE POWERPOINT PRESENTATION

Transcript/Show Notes

This is Susan Snyder, ACTEC Fellow from Chicago.

Welcome to our special series featuring ACTEC Fellow Steve Akers of Dallas, Texas. Today, Steve shares his final thoughts from his Trachtman Lecture and provides a great example of a business that puts fans first.

Overview

Steve Akers:  I point to the work of ACTEC Fellow Richard Franklin and his wife Claudia Tordini, and to Marvin Blum throughout this section, and more about them later.

An overview – we’ll talk about some planning considerations, trust structuring, what do we do with existing trusts, and then a few comments about that new Delaware wellness statute.

Planning Considerations

Realize there has been some shifting of attitudes until about the middle of the last century. For decades — well, for centuries, inheritance had been about passing on skills, trades, or land. We’re beyond that now. We would like to pass on more than that.

In addition, we would like to, some clients pass on more than just money even. Look at the hopes and dreams of our clients. Really dig into the hopes and dreams of clients, what would they like to do? We can approach this with our clients that during their lifetime, they can start doing things to help with the flourishing of their children and then build on that in their estate planning instruments.

I heard this morning the comment: what would it be like for the family to re-pull out the instrument that will be there historically for generations for the family? And it starts with, “I love you behind comprehension.” What a novel approach to the instrument that will historically be there with the family. A message with the money. Wills can be a way of expressing and communicating things that will be there with loved ones that you know and loved ones that you will never know. An approach that we can take, some planning considerations.

Trust Structuring

Here’s an overview of some of the things that we will talk about. First, begin with: we would create a baseline of support for well-being. Work with the individual to design what would be an appropriate baseline of support. Reasonable housing, good health care, good education. This is not support for giddiness – it’s not owning the largest home, it’s not owning three vacation homes or a jet. Basic support, enough to provide of those advantages with fundamental resources that give us that extra life expectancy that comes with people that have these fundamental resources.

Then beyond that, beyond the baseline, the distribution standard would authorize things beyond just health, education, support and maintenance. The trustee would involve the beneficiary as much as possible in making these decisions. For example, the trust instrument could authorize coaching. We often hear, and some of us have used, strategic coaches to assist us in our professional careers. Perhaps positive psychologists could help working with the beneficiary to design a plan of working with the beneficiary for that beneficiary to flourish in life. Providing ability to engage in “flow” activities, things that really have meaning for the beneficiary. Hopefully, the beneficiary gets to the point that their work is more than just a job. Maybe even to the point of being a calling.

A Form

Richard Franklin has given us a form. [Richard Franklin & Claudia Tordini, Well-Being Supported by Family Wealth – A Foundation to Flourish, BLOOMBERG TAX MGMT. ESTS., GIFTS & TR. J. (May 7, 2020).] Richard very generously provides form language for this. That could be a starting point if you have clients that are interested in going beyond just being positive.

This form starts with some introductory paragraphs, expressing the settlor’s desire that the beneficiaries would reach their full potential, building on the strengths and virtues of the individuals, providing their basic support needs but then allowing them to engage in endeavors that would allow them to flourish. Another of the introductory paragraphs would make clear that having exactly equal economic distributions is not a primary concern of the individual.

The Distribution Standard

Then he provides in the form that distributions can be made of income or principal for the well-being baseline and elements beyond the well-being baseline. The descriptions of each of those – of the well-being baseline and elements beyond that. For example, the elements beyond the instrument might give examples of what might be appropriate to support the well-being and flourishing of beneficiaries. A committee would be established to work with the trustee in carrying out and making these decisions.

Family Advancement Sustainability Trust

Fellow Marvin Blum from Fort Worth, Texas, has a somewhat similar approach – he calls it the Family Advancement Sustainability Trust. Now his suggestion is that this might be a one-off. This might not be a main part of the estate plan, but to establish a trust, put resources in it that are there to assist future generations in managing their inheritance. You know, maybe provide for family meetings and retreats, providing for education on various topics, including philanthropy. He would set up a leadership structure to implement this, and he would use a directed trust approach to do that. This could be done either during lifetime, set up during lifetime, or it could be set up in a testamentary approach following death. He points out this is not just for the mega-wealthy. This can be scaled to whatever is appropriate for the family.

As an example, sometimes we hear of a vacation home being put in this sort of a trust with resources to maintain it. All of this keeping in mind is scalable. These concepts may seem overwhelming. It doesn’t have to be all or nothing. We can start our conversations with clients of – “Do you want to do things, help structure things to have a positive influence?” – and go from there. What are the hopes and dreams of the clients? And build on that.

Income Tax Issues

Some of these expenditures may very well not be deductible administration expenses. Section 212 refers to being able to deduct expenses for the production of income, the preservation of property, or the determination of tax. Some of those sorts of expenditures really are not any of those things. Some of these may not be deductible administration expenses.

Well, what if there’s an expenditure that’s not deductible? Does it become a distribution? Not necessarily. Maybe there are some expenses that are still administration expenses even if they’re not deductible, but there’s just very little case law on this. Where do you cross over of that, is something that, is really a distribution for the benefit of an individual?  If so, would the trust provide for gross up distributions? So, if the trustee makes some of those expenditures – it ends up carrying out income to the beneficiary, the beneficiary has to report – can the trustee also make distributions to pay that income tax? Gross up distributions. Well, so review. We’ve talked about general planning considerations, structuring of trusts. Now, what about existing trusts?

An upcoming article in this summer’s ACTEC Law Journal by Claudia Tordini and Richard Franklin addresses this issue. What about health, education, support and maintenance? And they make an argument that the “H” in health, education, support and maintenance means complete well-being.

Remember back to those longevity studies. These concepts have an impact on longevity as well. They do acknowledge – there is precious little federal or state case law of what “health” means and how broad that is.

Delaware Wellness Statutes

First of its kind, this came last summer: Delaware adopted statutes saying that someone could create a trust – in that trust, they could reference Section 3345 of the Delaware Code and that those provisions would be incorporated. When they do that, that would be known as a “beneficiary well-being trust.”

The statute would then lay out things that the trustee shall do. It says “the trustee shall pay for…” This is someone that wants affirmatively to do these things in the trust instrument. What sorts of things? 3345(b):

First paragraph – educating beneficiaries about wealth, estate and transfer planning, assistance with transfer planning, wealth management skills. Trustees shall pay for those sorts of things.

Paragraph two – educating about family history and dynamics, things, resources dealing with family, wealth and well-being.

Notice those really don’t encompass things we’ve been talking about of an individual beneficiary’s well-being, and that was purposeful in the Delaware statute. The Delaware statute does say you can go beyond those things and add more if you want to in the instrument. The Delaware statute does not specifically and explicitly authorize gross up distributions to the extent that any of those expenditures were to be treated as a distribution carrying out income to the beneficiary.

3325 of the Delaware Code applies to all trusts, new trusts as well as existing trusts. And it says that the trustee may provide, not shall, may provide for and it was the first paragraph of things. May provide for things dealing with education of the family about financial issues, etc. It does not deal with the family dynamics, family health and well-being issues. It also does not authorize gross up distributions.

We will see if more states get on the bandwagon of these sorts of wellness statutes. We often find that Delaware is a leader in these sort of innovative ideas. We’ll see where that will go.

Part 4: Well-Being of Professional Practices

Well, we’ve talked about the scientific background, personal flourishing, assisting our clients to those that want to build in the flourishing of their clients. Let’s now talk about for professional practices, things that we might do. The Texas Bar Journal, January issue, cover, lead page: Wellness of Professional Practices. This is a topic becoming mainstream.

Fans First

I’m going to take an out-of-the-box approach to this with a focus on bananas – a special kind of banana, one of those squeezable kinds. You know, a very special kind of banana. What kind of banana are we talking about? We’re talking about Savannah Bananas. What are Savannah Bananas? Well, this will give you a hint.

Something to do with baseball, kind of a really fun type of baseball. ESPN tells us this is a big deal – this is a wave that is taking over the country.

So how did this get started? ESPN calls this the greatest show in baseball. More followers on social media than the New York Yankees. It has become a big deal. 2.7 million people are in lotteries to acquire the tickets. If any of you have tried to get these tickets, you know it’s difficult.

I heard it was in Boston recently, three games. And the games sold out practically within minutes. They’re a very big deal, very popular. So how did this get started? Well, their single mission is Fans First. Every decision they make is about the fans. If it’s not fans first, they don’t do it.

That has led to the development of special rules. This wasn’t initially there, but they’re trying to innovate, make it fun. Some of their special rules:

• There’s a point for every inning, kind of like match play and golf. Keep the teams into it. Except the last inning, every run counts. So, a team could come back in the last inning.
• There’s a two-hour time limit. They put it, everybody leaves at nine o’clock anyway. Two-hour time limit on games.
• No stepping out of the box.
• No bunting.
• No mound visits.
• A batter can steal first on a passed ball.
• There are no walks but “sprints.”
• On ball four, the runner tears off running, the first base, goes as far as he can. Every player on the defense, other than the catcher, has to touch the ball [before tagging the runner]. It works out. They all hover around second base. They all flip the ball around to each other. Sometimes the runner makes it to second base, and sometimes he realizes he doesn’t. It really makes it fun.
• If a fan catches the ball, it’s an out. Fans are in the game. If it’s the last out of the game, they bring the fan down on the field.
• For a tie game, they do a one-on-one. It is a catcher, the pitcher, and one fielder; atcher, pitcher, and one fielder. The batter hits and see if he can make it all the way back around the home plate. Both teams do this. If it’s still tied, then it’s just the catcher and the pitcher. Hit the ball, see if the pitcher can [run to get the ball and run back to tag the runner before reaching home].

So really, really fun. They make it fun. Well, how did this happen? Enter Jesse Cole. In 2014, Jesse’s wife took him to a game at historic Grayson Stadium in Savannah. The old historic stadium built in 1926. Babe Ruth played there. A lot of the old greats on the barnstorming tours would play through there. Jesse loved the old historic stadium, but there were 400 bored fans in the stadium. Obviously, it just was not working. The team – as other teams have – the team folded. Well, Jesse bought a team to take them there in the fall of the next year in 2015. Had problems initially – prospective sponsors, even the sports bar next to the stadium – had no interest in being a sponsor. That’s bad.

From October to January, the team worked tirelessly to connect with the community. And big problem, the community said: “No team has ever succeeded here. Why would you be any different?”  And they realized they weren’t being any different. They were chasing customers and not fans. January 2016, Jesse and his wife were broke. They sold their home, they maxed out their credit cards, they realized they’ve got to go for broke. They’ve got to go big. They’ve got to go different. And they started going different. They had to break the rules. They started a community project to name the team. And the team ended up with the Savannah Bananas. Why did they pick that? Jesse said it rolls off the tongue: Savannah Bananas. And they could do a lot of promotions around bananas.

Well, the press just savaged them: “The single most ridiculous, insulting, hideous, embarrassing, outlandish name for a baseball team.” But they had the community’s attention. They announced that they would have a one all-in price on tickets, which would include all the food you could eat, all the drinks you’d have (other than alcoholic beverages, they were extra). They announced there would be a senior citizen dance team called the Savannah Nannas.

It was not going to be long, slow, and boring. They worked hard on building a culture of the players, as well as all the staff, of Fans First. The opening night was a disaster. They sold out the stadium due to all this attention they were getting. All-in-one ticket price, 4,000 people were there, and it started raining at 4 o’clock. They just stormed the stands that weren’t ready. The concessions weren’t ready. It was just cold and rainy, and everybody was bored.

Jesse went to the Savannah Nannas and said: “Would you be willing to go out in the rain and do your dance thing?” They said, yeah, we’ll do it. They did it. Well, the crowd got into it. Singing and dancing, nobody left. By 8:30, finally the rain stopped and the game could start.

During the game, a woman went up to Jesse and said, could you get me a signed baseball? Said that I’m here because my fiancé recently died, he came to every opening game at Grayson Stadium, and so I’m coming here in his honor. I’d love to get a signed baseball. Jesse said, I’ll see what I can do about that, sure. And she said, and I see that you have a player on the team named Drew Moody. That was my fiancé’s name. Could you get Drew to sign the ball? And Jesse explained, well, Drew was still in college, he hadn’t got here yet, but his brother Logan was here. So, let’s see what he’d do. Jesse took the ball, took a ball to Logan and explained the story. Logan said, give me the ball. He took the ball, had every player on the team sign it. And then Jesse in uniform went up in the stands, sat next to the lady for a half inning, talking about her fiancé. Wonderful story. Walking back to the dugout, Jesse saw this and he said, “Logan, wow.” And Logan said, “Fans First, right?” Had the culture.

Another interesting vignette. After every game, all the players will go out on the concourse and sign autographs. At one point, Jesse was hearing the players, and a kid went up to and that signed the jerseys. And the kid went up to him and said, would you, a player said, would you sign my jersey? And the player said, “no.” And Jesse jerked his head around. But the player said, “until you sign my jersey.” And the player did that throughout the season. By the end of the season, he had signatures all over the front and back of his jersey. Kind of the culture that was there.

What does that mean for us in our estate planning world? Jesse says that he firmly believes there are principles that can be applied to any enterprise. And I want to pull out nine of these principles.

1. Get fanatical about fans. “Every game is someone’s first game.” The power of first impressions. He calls it “plus-ing.” Give the fans more than what they expect. Sometimes even more than seems reasonable. He says in the front office, they rarely talk about revenue. They always talk about how do we create more fans? Every touch point is an opportunity to thrill a fan.
2. You wouldn’t believe moments. “You wouldn’t believe what they did last night.” He says that is the best form of word-of-mouth marketing. They don’t spend hardly anything on traditional advertising. They go all in on these “you wouldn’t believe” moments.
3. The first fan must be yourself. And this is really the concept of flow that we’ve been talking about. Toward the bottom of that – “You are not spending your time doing what matters where you can make the biggest difference.” If you’re not doing it, you’re missing out on life. You’ve got to “find fun and become your biggest fan.” He says, “if you’re not losing track of time, you’re doing the wrong thing.” Organize your day so that you do those things that bring you energy and joy.
4. Eliminating friction. Put yourself in the fan’s shoes. What are the pain points? What can you do to eliminate the friction of those pain points? The concessions and the stands and pain points, they were all-in ticket prices. Interesting that they have found that, yes, they have an all-in ticket price. But that despite that, they find they have the Bananas’ fans spend twice as much as at other stadiums. And Gail and I found that going to a game. Yes, you get all the free hamburgers and hot dogs and grilled chicken sandwiches and Diet Coke you can drink. Yeah, which means one sandwich, one Diet Coke. But then you go into the store, and you buy $300 of goods. Eliminating the friction.
5. Experiment constantly. They try four new promotions every night. And they say every night — a lot of them bomb, but they’ll find something every night that makes a huge impact. “Be a speed boat, not a cargo boat, not a cargo ship. Be able to turn on a moment’s notice.” Fans deserve baseball, as it could be that fanaticism drives them to experiment.
6. Say “no” to grow. You know, this is what we’ve discussed in one of those. Say no, eliminate what is not successful. Steve Jobs says “it’s so easy to add, it is so hard to edit.” When Steve Jobs came onto Apple, they initially eliminated all but four products. Now this is: A, B, C, Discard C. Say “no” to grow.
7. Engage deeply. We can really resonate with this as estate planners. Steve Jobs says, “get so close to your customer, you tell them what they need before they realize it themselves.” And sometimes we’re in that position as estate planners. The FORD concept of connecting with clients. This is not the automobile Ford, it’s the acronym. A wider approach of organizing, connecting with clients: Family – Occupation – Recreation – Dreams. What a pattern for engaging conversations with people. Family, occupation, recreation, dreams. You know, going back to the hopes and dreams of the individual.
8. First fans first. Your first fans are your company; your company staff, your employees. You’ve got to build and take care of your own team. To go fans first, you first got to take care of your first fans. How do you do that? “Eliminate friction … empower their ideas, engage with what they love, experiment with ways to recognize and appreciate their hard work.”
9. Know your core values. They use this cute C, B, E, F, G, H approach. (Caring Different Enthusiastic Fun Growing Hungry.) We would come up with our core values of whatever it is.

These are the references for this wonderful story of the Savannah Bananas. (Fans First – Change the Game, Break The Rules, Create an Unforgettable Experience, by Jesse Cole; YouTube: TheSavannahBananas.)

What does this mean for our practices? For your practice, I have no idea. My purpose of this is just to get the juices flowing. What could it be like? In the estate planning world, what would it be to go all-in on clients first? To take the radical steps to go all-in on clients first.

As we think about this, first I’ll remind us how fortunate we are. The first annual meeting that I attended, Professor John Langbein gave the Trachtman lecture, said some things I will never forget. I’ll just read at the end of this: “The trust and estate lawyer can make a boast that comes honestly to the lips of too few lawyers. It is that virtually every human being you touch in the course of your work is better off for your having been here.” What a splendid thing to be able to say of one’s career. That is remarkable and we are appreciative for what we get to do.

Several Suggestions

First fans, taking care of staff first. How do we create a culture within our staff, our associates, of clients first, going all in on that? How do we take care of our employees? Some good ideas I thought that Jesse had that are listed, that we read.

And then clients first. What are some things we can do? From the Banana world, engage deeply. Look at what clients really care about. Clients sometimes say they don’t even know what questions to ask. Digging into the hopes and dreams of clients.

We heard just some wonderful comments in the Cultural Competence Symposia that has to do not only with culturally diverse clients, but any clients. Just some wonderful tips. Having more in-depth conversations about values, we need to develop plans that foster the values of the family. Be aware of what our client feels is important. Sometimes we can learn more if we’ll let our clients talk more. Imagine that. Perhaps the client ends up trusting us more. Really good learning there.

Ann Burns told us – and I had the same thing — start with the end goal in mind. Particularly in going through a complicated, sophisticated transaction. Start with the end goal. Where do we want to end up? And then as we’re going through this, point to the end goal.

Simplified sophistication. Lou Harrison has given us this. We do really sophisticated things and complicated transactions. To the extent possible, simplify our documents as much as possible so the clients can understand them.

Communication. I’m going to poison you with this if you’ve never heard it – Lou Harrison poisoned me with it. And once I tell you, you just can’t get it out of your brain.  So, if you don’t want to hear this, get off now.

He told of an old Far Side comic strip. First frame, the donor says to the dog, “I have a new bowl for you of really good dog food, Ginger. I want you to eat that food and go outside and do your business.” Second frame, what the dog hears — Ginger hears. “Blah blah blah blah blah, Ginger blah blah blah blah blah.”

And we just know when we’re talking with clients about these complicated transactions and we start seeing, we just know in their mind it is “blah blah blah blah blah.” Even if the client is following at the time, an hour later, can they relay what is being done? Communication is just so vitally important, and we know that.

Say no to grow. Lou Harrison – again, thank you Lou – back to your 90-10 rule. We know all of the 80-20 rule — 80% of revenues come from 20% of clients. Lou’s 90-10 rule. 90% of his aggravation comes from 10% of his clients. If he could just get rid of those 10%.  The late Don Maloof, Dallas ACTEC Fellow, gave himself a birthday present every year by firing one client.

Family meetings. Fellow Nancy Hughes has inspired us of getting out of her comfort zone and facilitating family meetings and how meaningful that has been.  We heard at the seminar, letters of wishes can be very impactful. In documents, some of that can be put into documents as well.

Death book, putting together a book of financial information for emergency.

Professor Anne-Marie Rose encourages family to tell their oral histories and speaks of vendors who can help in doing that.

Well, we’ve looked at science behind this, personal flourishing, flourishing with our clients’ legacies, with our professional practices. Thanks for bearing with me as I go through this personal quest of dealing with these issues.

What do we do with this? Let me leave you with this comment. If any of this resonates with you, what do we do with it? I’m a member of and on the board with a nonprofit organization that assists other nonprofits in being more successful in serving their clients. This nonprofit organization is called the Tod Bush Leadership Center. Tod Bush was an incredibly passionate individual about serving. He died young. His wife found in his journal, this comment that is now on one of the meeting rooms, and I’ll leave you with this comment: “It requires intentionality. None of this just happens.”

Susan Snyder: This concludes the 2025 Joseph Trachtman Memorial Lecture Series. Thank you, Steve, for sharing your insights with the ACTEC Trust and Estate Talk audience.

This podcast was produced by The American College of Trust and Estate Counsel, ACTEC. Listeners, including professionals, should under no circumstances rely upon this information as a substitute for their own research or for obtaining specific legal or tax advice from their own counsel. The material in this podcast is for information purposes only and is not intended to and should not be treated as legal advice or tax advice. The views expressed are those of speakers as of the date noted and not necessarily those of ACTEC or any speaker’s employer or firm. The information, opinions, and recommendations presented in this Podcast are for general information only and any reliance on the information provided in this Podcast is done at your own risk. The entire contents and design of this Podcast, are the property of ACTEC, or used by ACTEC with permission, and are protected under U.S. and international copyright and trademark laws. Except as otherwise provided herein, users of this Podcast may save and use information contained in the Podcast only for personal or other non-commercial, educational purposes. No other use, including, without limitation, reproduction, retransmission or editing, of this Podcast may be made without the prior written permission of The American College of Trust and Estate Counsel. If you have ideas for a future ACTEC Trust & Estate Talk topic, please contact us at ACTECpodcast@ACTEC.org. © 2018 – 2025 The American College of Trust and Estate Counsel. All rights reserved.