Lunch & A Divorce Lawyer Live with Attorney Peter Olson and Attorney Matt Margolis

This month we're talking with Estate Planning & Elder Law Attorney Matt Margolis about providing that peace of mind (not to mention a HOME) for you and your loved ones as they age. Plus, he answers a BIG family law question: What happens to your estate plan when you divorce?

Learn more about Attorney Matt Margolis here: https://www.margolisweldon.com

Peter: Hello! Welcome to 3rd Thursday, Lunch & A Divorce Lawyer.  I'm attorney Peter Olsen, Chicago Family Law Group.  I am so grateful to have everybody jumping on our Facebook Live today and also particularly thankful and appreciative to have Matt Margolis, an Elder Law and Estate Planning Attorney.  Do I say you're firm Park Ridge, that's on your website?

Matt: You got it.

Peter:  The beautiful Northwest Highway, fun memories of Park Ridge, five or less places I've actually lived in my life in Park Ridge.

Matt:  That's right, I remember that.

Peter:  Thanks for jumping on, so what's the real world?  I once in a while handle a divorce or custody case and I feel like I'm always like, “Hey what it might be like the real”.  I always think the client cares about things like, “Hey what's my real-world win”.  I almost feel like it. “hey get more time with my kids or getting somebody out of an abusive relationship or kind of protecting them financially going through a divorce from from a former husband or wife.”  Those are some things, I think it was like my real-world wins.  What are your real-world things you're doing for your clients in the Estate Planning Elder Law Space?

Matt: I'd say in situations “Real World Wins” I’d say for sure situations where you know we've got an older individual coming to us typically through their adult children, they're starting to slip cognitively.  They don't have any documents in place and getting them set up before they inevitably get to a point where they're unable to sign any legal documents. 

So to me, that's huge.  A lot of people, when it comes to estate planning and I'm sure without really knowing it, you probably know it, people procrastinate.  Don't get this stuff done, they wait till the last minute until there's a crisis.  So, for sure getting those documents in place before somebody's incapacitated. 

We've dealt with some really close calls, we deal with a lot of situations where we're having to get doctor's letters in place just to confirm that somebody can sign documents. Then I'd say other situations, some big wins for us, for our clients on the elder law side, we help people apply for Medicaid.  That's great but where we can really provide a lot of value and where people really appreciate our service is when we're helping them not just apply for Medicaid but protect some assets.  We work with a number of individuals and we've always got a handful or more of clients where they were not proactive, they didn't do anything from a planning standpoint prior and now they're moving into a nursing home.  Most people think that it's too late at that point to protect anything and that they're just going to spend all their money down and apply for Medicaid. 

The reality is we can protect about 50-60% percent of somebody's assets above what Medicaid allows them to keep at the last minute really in a crisis scenario.  So, those are huge wins for us and for our clients obviously.  We feel good but I'd argue that they feel a little better.

Peter:  Yes, I want a sense of accomplishment for people who work for us, I am sure you feel the same way. The client is one who lives with this for better or sometimes for worse, but family law can be a little more combative. 

The capacity issues, I could surely see that.  My wife's been hammering me.  I am in my mid 40s but even more so than the law firm succession plan, that's what she's been hitting me on.  What should I do?  Who do I call?

Matt:  I had a client actually email me earlier today saying her husband had a practice for 50 years, passed away a number of years ago, and she just reached out to me today.  We figured everything out but she just realized that there's about eighteen hundred dollars sitting in my husband's IOTA account, in his client trust account.  We can't account for any of this and it's sort of like where it go.  So, as attorneys I feel like it's especially important that we have some kind of plan in place.  Normally we work on that plan later than we should.

Peter:  It's made my list of eight personal goals for the year. That means I'm serious about losing weight and I don't know what else.  I think I'm doing a triathlon in October, which is very important stuff.

So, State planning, Medicaid planning, anything else in your top three or four things you guys are doing or you as a practice or you as an individual attorney.

Matt:  That's the crux of what we do here.  We always say we practice on the box, I think we're a lot like you, we know what we're good at and we’re good at it and we try to reinvent the wheel.  So, all the other stuff we just refer to is not worth screwing around. 

Peter:  Agreed, specialization is the answer especially in an urban area.  I feel like talking to some lawyer in Wyoming recently.  He's like, “Oh yeah, it's still okay to do X, Y and Z.  These are like disparate practice areas.  It's maybe in Wyoming, but probably not in Chicagoland.

So, what's a thumbnail, unlike your background from College Law School to present, how did you find yourself in the Estate and Elder Law, small law firm chair in the Northwest Suburbs of Chicago?

Matt:  All right, I don't know how much time you have but at least let's see if I can cut it down. Going back to when I was in Junior High, that's when I basically knew I wanted to be a lawyer.  I knew I wanted to help people.  I wanted to help people and I wanted to make money.

I had two uncles that were both lawyers and.  I remember from an early age, neither one of their wives worked and they were able to support their families and I thought that was pretty amazing even at a young age.  So that's where it started then fast forward a number of years when I got out of law school.  So, I went to Law School John Marshall, I'm Chicago born and raised.  I grew up in Skopje, went to DePaul for Undergrad, John Marshall for law school.  I always say other than traveling, I've kind of lived within probably a 10-mile radius my entire life.

So, in law school, I thought I was convinced I wanted to be a personal injury attorney.  I was working for two attorneys, small firm.  They did personal injury and criminal defense.  I knew I wasn't really interested in the criminal defense side.  That really didn't excite me but the personal injury side, I really liked.  Well, I ended up basically when it came time to study for the bar exam. They dropped me and didn't respond to any of my calls, emails and texts when I was trying to come back to them, to work for them after the bar.  So basically, enough scraping, I found a job with another attorney in the city who did personal injury work.  He went to law school with my uncle 30 years ago and this guy was willing to basically give me a desk rent free in Downtown and basically said, “you know what, you can work and bring in whatever business you want.  You can eat what you kill and I'll give you some work to work on and I'll pay you out of it.  He was a great mentor; his name is Conrad Szewczyk.  I like to be closer with him now, but life goes on and we're both busy but that worked out about a year and a half and it got to a point where I just couldn't do it anymore.  I wasn't making enough money, I was living with my parents in their house in Skogi, making them need to go out for a week. 

Honestly, when I looked on a craigslist ad, when I didn't even know if that was a thing even 11 or 12 years ago but I when looked on craigslist, found a job posting, looked interesting, and ended up going on the interviews and Estate Planning and Elder Law Firm in the suburbs and at that time I could tell you I was not thrilled about it at all.  Because before this, I was Downtown in court arguing, emotions and whatnot and the idea of going to the suburbs and in my head at the time working with old people was less than what I had imagined myself doing as a lawyer.  I ended up getting the job and I needed a salary even though it had that much money.  Within three months, I realized that’s what I wanted to do and that was my calling.  I think I really enjoyed it.  I felt like I was really helping the people, accomplishing something that was important to them.  I realized I didn't like being in court as much as I thought I did.  I wasn't having to argue with other attorneys all day.  I might have been dealing with some crazy family members and siblings not getting along and parents and their kids not getting along but short of playing a little bit of a mediator.  I really just felt like it was a nice career, a lot of practice in. 

So, I ended up staying at that firm for four years, learned a lot and then my now partner Lauren Weldon, she joined that firm with me last year.  I was there, so we worked together for about a year and that's when we left to start our practice.  I knew early on, I was never like a big firm type of guy, it's never what I wanted.  I always wanted to run my own law firm and I knew being an attorney would allow me to do that.  That's it, now we've had our practice for a little over seven years.  We landed in Park Ridge because my partner lives in Mount Prospect and my wife and I were living in the city at the time.  It seemed to be somewhat of a happy medium.  We didn't want to be in the city and knock on wood, life is good.  We're continuing to help people and families, help people accomplish what's important to them. 

Peter:  That sounds. I would assume it's very meaningful work.  I remember here's just a super short funny aside as I had sort of a similar path in this sense.  I remember my second year of law school, having a great summer job at an Insurance Defense.  They were defending the PI cases.

Astounded, I think it was at 150 West East Wacker, it was that Wacker and Adams.  It was great.  It was convenient to the Union Station and it paid great, but it was awful in the sense that you weren't dealing with real people.  You're dealing with insurance companies and legal professionals and that's literally when I like. I literally work in the Elder Law Clinic at the Southern Illinois University School of Law, my last couple years of law school and I'm not really doing Elder Law anymore.  I'm not a competitor, but in the same sense family law is the same in the sense you're dealing with an individual and it's like this person across from me, you can help them and change their life for the better.  It's not this random legal world that is like, “hey maybe you're getting a win but it's a win for somebody, like three steps removed from you instead of the person in front of you.

Matt:  It's different.  I've never been in that area, I've never practiced any area of the law where my client wasn't an individual.  So, it's hard for me to even relate to the idea of representing a business or a company where like you said you feel like you're so far removed, even if you're working with somebody at the company, you to them is like me to the law firm I work for.  We're not the ultimate client.

Peter:  It definitely changed my trajectory just like the difference between path A or path B.  I was just doing a little prep for this interview today and, is this a true statement Matt that if somebody was like a previously appointed fiduciary? I'm just going to call them executor, trustee or power of attorney, then boot them from that role if now you're my ex-husband or wife.

Matt:  Okay, so let's answer that in a couple different ways right. When we look at a will, we look at the last will and testament.  If my spouse and I get divorced and she's named realistically if you're married you're probably named as you're the executor probably you're first beneficiary.  Your primary beneficiary.  Hopefully, you've got contingent beneficiaries after your spouse, but your spouse is probably your primary executor or primary beneficiary.  Upon divorce, even if you don't update your documents, your spouse is treated as if she died before you.  So they basically wipe the spouse off the document.  When we're looking at a trust, so if we're looking at a revocable living trust, then any provision in which the former spouse was named, whether it's a trustee, whether it's a beneficiary etc. that part of the trust is deemed to have been revoked.  So very similar in concept basically as if your spouse predeceased you.

Then powers of attorney are a little tricky.  There's a little bit of a difference now in of course everything I'm saying is in the Illinois law, so I don't know people are tuning in from anywhere else.  So, just want to plug that, I'm not giving legal advice for anybody in a different state.  So for a power of attorney for property is the legal document where I'm naming somebody to make financial decisions for me in the event that I'm incapacitated.  Upon the divorce, if anywhere my spouse is named in the power of attorney, typically again your spouse is probably your first agent that you name in the power of attorney.  It's as if your spouse passed away.  Basically, at the time of the divorce, it's like your spouse passed away, so even if you don't update the property power of attorney, my ex-wife is now off and whoever I've named next would be the person that would step-in in line for me.  However, as it relates to the healthcare power of attorney, none of this applies.  So, for healthcare decisions, the divorce has zero impact.  In fact, that ex-wife of mine can still pull the plug. Maybe your ex-spouse would be the best person because at this point maybe they have zero emotion, which is almost what you want, that's the decision you want them to make, but that's funny, that healthcare power of attorney doesn’t go away.

Peter:  That's good information, seriously.  Honestly, I don't feel like I'm looking at that kind of stuff as much as they should because I don't know the generic person's getting divorced when they're 35 or something like 80 or something but that is good info because I feel like the big reminder I'm giving people at the end of a divorce is the beneficiary stuff.   Meaning you're on a 401K bank account because a lot of that stuff, if you don't move me off your 401K, you're getting that.  There isn't a lot of that like self-effectuating.  There are some classic cases with life insurance policies where the ex-wife got a million bucks.

Matt: Yes, I mean if you look at joint ownership, you and your ex are joined on any accounts or definitely beneficiary of a life insurance policy or IRA or any kind of retirement account, you have to be proactive and take them off of that. 

Peter:  Absolutely know that, that's one of my huge bigger things post-divorce.  I did not know the health care power of attorneys, so I'm gonna add that to my checklist.

Matt:  Same with the HIPAA, so if somebody's got a HIPAA release, a lot of practitioners now are including this in the State Planning package. If you will, a lot of us will include HIPAA health care authorization.   So, I can name a plethora of people that could step in and communicate with my doctor or various medical professionals if I'm incapacitated and I'm not able to give direction as far as whom my medical professionals can talk to, not necessarily make a decision but get information and so that one does not go away either.  So that one you have to be proactive and you've got to remove that ex-spouse off of that as well.

So that may not come up as much but something again.

Peter:  I don't want to keep you too long and drown on forever, but we talked about this Medicaid planning.  It's hard to do Medicaid planning cliff notes. I had reached out to you six months ago or so and it was related to two 80-somethings who owned a home together and are going through a divorce and one of our clients was thinking about how to get into a Medicaid sort of nursing home facility.  I was trying to use your expertise related to how to fund her future housing and what they do with this house they're living in.  I know enough to trigger a few issues in my head, so it was like when do we get divorced, do they stay married related to that Medicaid stuff.  So, what is sort of a thumbnail, Medicaid planning?  Is there a simple way to do it or do I need to invite you back for another 30 minutes?

Matt:  I could probably talk for an hour on Medicaid planning depending on how deep we want to go but Medicaid planning can be tricky.  In reality when somebody's applying for Medicaid and you're a married couple, they look at all your assets.  It doesn't matter if I've got assets in my name only or my wife has assets in her name only, they're not just looking at the joint assets, they're interested in everything that we have as a couple.

When there's a divorce or there are situations where, I'm not sure if this is what you're getting at but there's situations where people come to us and inevitably somebody has probably said something to them or they've done some research online where they're like,  “should we get a divorce because if my spouse is going on Medicaid, does it make sense for us to get a divorce to divide the assets in an effort to try to protect something?

It really depends.  If somebody's just looking to get divorced because they're ready for a divorce in a more traditional sense, then for sure and then we can figure things out.  I don't know if that's your question or if the question is more related to the idea of using a divorce as a mechanism for trying to protect assets. 

Peter:  I was so disjointed or semi-ignorant, maybe dividing assets, but when I was coming at you with that question a few months ago, it really almost tied to like, could we do something with the house to keep the house and maybe somehow the person who's not going into the nursing home facility, could keep the house and we could structure the divorce in such a way?  I was just going down different roads.  That case actually still isn't done for what it's worth but the information is still very relevant in terms of what we're thinking about doing.

Matt:  We're talking about a traditional divorce then.  Whether Medicaid or not, this couple wants to get a divorce.

Peter:  Yes, that’s a divorce Medicaid or not, how do we do this in the best way possible basically for an 80-year-old woman who might need some assistance in terms of her housing.

Matt:  The reality is just in almost a fairly simple sense when a divorce occurs in this type of situation, where again it's not really Medicaid related or we're trying to protect assets.  It is more like we're ready to get divorce and you need to be careful is just a fact.  The state of Illinois likely doesn't want to see it.  They're going to see a pretty even split of the assets and I imagine for the most part within with an elderly couple getting divorced and obviously I don't practice in your area or dabble in it, but the State of Illinois probably wants to see a pretty equal distribution of assets.  What they're not going to want to see because this is what people come to us for?  People come to us of the mindset of, “well, we really don't want to get divorced but we're thinking about the idea of divorce because maybe we can protect more assets that way and if we need to apply for Medicaid for husband or wife that's going into a nursing home, so the people think that they can get divorced just to kind of split up the assets.  The problem is a court is not going to be okay if I'm the one going into the nursing home and my wife is not, the court is not going to be okay if my wife walks away from the divorce with 80% of the assets in her name and I walk away with 20%.  Even under normal circumstances, I wouldn't want my wife to have more in the divorce, we both know that more will get to the kids if we leave her with more.  Because the more money that's left in my name, it's inevitably just gonna get spent in the nursing home until I run down and apply for Medicaid.

So, in some situations there's just not a whole lot we can do for you.  We might just be looking like, “okay this gonna have to be a 50/50 split” and at that point we might be able to protect some of the assets that are staying in the name of the individual who's applying for Medicaid.  There's still some asset protection we can potentially do after the division of assets.

Peter:  Honestly, I'm not doing too many divorces with 80 years old but I have one right now, so it's definitely like I've had my radar going off a little bit because of that.

It's a big question for three months or less.  But my plug on the general idea of Medicaid planning is I don’t like they had to reach out of that with my now deceased grandmother.  She was living in Florida at that time. To some degree it's a federal right and it's a federal and state mixed program, but he was able to keep that residence.  I don't know if this was Florida thing, it's a little bit interesting down in Florida, are you able to even fix up the house a lot?  Like, you're able to put money into the house, is that kind of an exception?  That's just a totally random personal aside, I just remember they were able to remodel the house totally legit and get my grandmother into a nice facility.  Basically, I think about effective Medicaid planning.

Matt:  Was your grandfather still living?

Peter:  No.

Matt:  All I can say is from the Illinois standpoint, I can definitely do whatever I want to update the house, but if I'm a single individual, widowed or divorced does not matter, single individual.  So, if I'm not married in any sense and I'm applying for Medicaid and I move out of my house, the house is not a protected asset.  I can do work on it but that's typically not something that – if a single client of mine is going to move into a nursing home and apply for Medicaid, they're probably not going to put that much work into the house.  That's going to be more common if there's a spouse still living in the home because then it makes sense to update the house.  Spend 50 grand to update the house because the house is a protected asset for the spouse; however, in Illinois the house is not a protected asset for a single individual applying for Medicaid.

Peter:  Interesting distinction there.

Matt:  It really depends, it's pretty fact specific when it comes to Medicaid planning.

Peter:  Okay, so just in wrapping some things up Matt.  Thanks again for jumping on here.  Your website says, I'm quoting this like the New York Times or the Bible or something for validity, “You're a self-proclaimed foodie” I'm gonna direct you to some question or two.

Where's your go-to #1 or 2 restaurants in Chicagoland, if you're a self-proclaimed foodie?

Matt:  I probably need to update my website since moving in…

Peter:  Wait, you don't dine out or what? I know you have younger kids, you could be in the suburbs.  I'm just saying Chicagoland.

Matt:  No, for sure.  The side note is, unfortunately since having little kids and it's no excuse at all.  My wife and I don't go out as much but I would say when we were living in the city, we loved Bristol which is at Damon and Webster, a great spot there.  I think it's still there.  I don't know why it wouldn't be and one of my all-time favorite places in the city is Publican.

Peter:  Are they full dine in?  They're notable for their bakery and breads? I feel like there are a lot of restaurants even.

Matt: Well, there's the Publican, I think Publican has a bakery now.  They've also got this PQM (Publican Quality Meats) so you can buy sausages and some of the meat that they sell, that they cook in their restaurant but Publican is awesome.  My partner and I actually received some gifts around the holidays from Publican.  They do like, you can order their brunch and have it shipped to somebody.  For them to get, you still gotta make it yourself at home but their claim to fame is like this: they cut bacon.  The bacon's like an inch thick, it's insane.

Peter:  That's good to know.  I think I get your email marketing and sometimes I see Matt Margolis behind the cooktop, what's your signature dish?

Matt:  We like to keep it light-hearted, right? Everybody knows what you do for work, I love it.  So, I started off calling it Turkey Slop, and that's what my kids call it, but if I want to class it up a little bit, I 'll call it Turkey Stroganoff.  So, I just randomly made this up one night.  It might be the quickest way.  It is ground turkey, mushrooms chopped up, a little bit of onion chopped up, some chopped up spinach.  Cook it all down and add some milk, some flour and two slices of Deli American Cheese.

Peter:  You had me into the American cheese.  That’s not even a cheese product is what you call that.

Matt:  Well the Land O'Lakes, I'm not talking about those Kraft stuff, those Kraft singles. Just mix it all up and serve it over some noodles and it's easy.

Peter:  It sounds pretty good.  It sounds cool.  It sounds close to turkey tetrazzini, which my wife raves about from the cafeteria at Michigan State University.

Matt:  Oh yes.  I've never thought about that, you're right.

Peter:  I don't know.  To me, that's a little bit of what you would call it a secret dish too.  You never really know what's in it.  I think there's celery and I don't think you mentioned celery.

Matt:  There might be peas in Turkey Tetrazzini too, I don't know.

Peter:  That's good info though.  Thanks for that.

Matt:  That's like a once every two-week meal in our house.

Peter:  Well thanks again for jumping on Matt, I am super appreciative and I haven't talked to you in a little while.  Totally just wrapping up.  Your kind of ideal client and where can people find you if they need some Medicaid planning ato.

Matt:  Ideal client, on the estate planning side, anybody and everybody that needs a plan? You're over the age of 18, you're a good client of ours.  Realistically, you've got some kids, you haven't done a plan, that's a great fit for us and then on the elder law side, you've got a loved one that's started to struggle and not doing so well and you're having a hard time navigating this final chapter of their life, we're happy to be a resource.  Even if we're not the best fit, in general, we can at least point you in the right direction if there's nothing we can help you with.  People can find us, are you going to throw on the screen or what you're going to send out but our name of the firm is Margolis Weldon, head to our website www.margolisweldon.com.  Lauren and I will be happy to help anybody that needs us.

Petter:  Awesome, yes, no I'll definitely toss it in the show notes and stuff.  Well, thanks for sharing your expertise Matt and I think you're my only Elder Law Attorney on my business partner touch plans.  I'm trying to talk to you about some stuff and hopefully we can get millions of viewers on this Facebook live video.

Matt:  That’s the only reason I agreed to this other than getting to see you.

Peter:  Okay cool, be well.  Take care Matt.

Matt:  You too Pete, alright see you later.