If you think trust and estate planning is boring, you haven’t yet met Lee-Norah Sanzo, Wealth Manager at LNW specializing in trusts and estate planning. Lee-Norah joined LNW in 2020, bringing with her a passion for helping clients to prioritize and plan for the future. We sat down to talk with Lee-Norah about her work and why her intentional approach to planning is a perfect match for LNW’s clients, culture and operations.
Q: Lee-Norah, what is your role here at LNW?
Lee-Norah: Essentially, it is to help clients build plans that support what they care about the most in a lasting way. And this always starts with developing a relationship with clients that allows us to work together and fully explore what they want to do. By understanding each client’s values and goals, we can apply the toolkit that is most effective. But it always starts with an intentional plan.
Q: What do you mean by intentional?
Lee-Norah: By “intentional” I mean probing deeper into what you value so that what you do with your assets fully reflects who you are and what you want to accomplish. I think most of us know what we value in life. Often, it is our spouse, our children, the organizations and communities we’re a part of. But most of us don’t ask these very important follow-up questions: Who are the people we trust? What are our wishes for after we’re gone? What do I want for my partner, for our children, for my community? What will be my legacy?
“A large part of my work involves getting to know our clients and their families – their needs, concerns and aspirations.”
Having an objective outsider guiding you through this process can be very helpful. I start by exploring with clients the answers to some key questions. Only you (and your partner) can answer these questions. Not me, not your attorney, not your accountant. I often suggest that clients find a quiet place and time, perhaps with a cup of tea in hand, perhaps in the company of their spouse, to sit down and explore the answers.
Over the years, I have seen how life-affirming and empowering answering these questions can be. I believe it is important for loved ones to be part of this conversation so they know your wishes and can help carry them out. Also, so they can have the opportunity to ask questions and really understand your intent
Q: What do you spend most of your time on?
Lee-Norah: A large part of my work involves getting to know our clients and their families – their needs, concerns and aspirations. That is the only way I can give advice that is going to work well for years to come. I also advise on trusts and how clients can make the most of trusts in transferring both assets and values to future generations.
Basically, a trust is a legal document that now or in the future cordons off a certain portion of your assets for safekeeping for the benefit of certain people or organizations. This allows you to strengthen the people and causes you care about most by providing them with funding for specific purposes. It’s interesting to me that the word “trust” comes from the old Norwegian word for “to make strong and safe.”
Q: Why do people set up trusts?
Lee-Norah: A trust can allow you to be intentional about what you want to accomplish with your wealth in a very private and controlled way. Trusts can limit distributions to beneficiaries to very specific purposes, or they can be more lenient about the use of funds. Trusts can also be used to strategically fund a favorite charity, provide a tax-planning vehicle, or care for a beneficiary with special needs.
Q: What are the key differences between a trust and a will?
Lee-Norah:A ll becomes a public document upon death, because it is filed with the Court; anyone can then access a will through the electronic court-records system. Everything in a trust, by contrast, remains private. Because it doesn’t go through probate, a trust also avoids the costs (both in time and money) of that process. Thirdly, a trust can operate during one’s life and be especially valuable during times of disability. A will does not have any affect until after death.
Q: Why do trusts seem intimidating to so many?
Lee-Norah: I think that is mostly due to misconceptions. Many people think that you always lose control over assets when you put them in a trust. Or that trusts are not something a younger person would put in place. But those things are not necessarily true.
Trusts can be as nimble and flexible — or as rigid — as you want them to be. If you want to keep control of your assets or to make changes in the future, you can set up a “revocable” trust, which can be changed or revoked at any time during your life. Or include language that allows certain components of the trust to be changed. If you do not want to commit assets right away, you can set up a trust that is funded after death.
Step One…
Fundamental Questions
- Who are the people and organizations I (we) care about most?
- Who do I trust to care for me?
For my partner? For my assets?
For my young children? - How important are tax savings to me?
- How much control do I want over my assets — during my life and after I’m gone?
- What unique assets do I own (business, collections, real estate) that I would like to plan for separately?
There are many different options when it comes to trust structure. So we sit down with clients to fully explore their aspirations, as well as their finances, before suggesting what type of trust(s) would work best for their situation. A trust document cannot anticipate everything. It should provide enough direction, however, so that the person deciding on distributions (the trustee) can “stand in the shoes” of the person who created the trust.
Q: When is the best time to set up a trust?
Lee-Norah: Actually, there’s no specific time and it is never too early to start. A revocable trust (a trust during life) or a trust under will (a trust that is funded at passing) are often used. Both of these trust types are components of a good overall estate plan, which should also include a financial power of attorney and various types of healthcare directives.
Q: What kind of assets can you transfer to a trust?
Lee-Norah:Virtually any asset can be transferred to a trust – not just stocks, bonds and financial portfolios.
For example, you can transfer ownership of your home, an art collection, a farm, the family business. A trust can be a vehicle that facilitates the transition of ownership from one group of owners to the next in a tax-efficient way.
Q: What role can trusts play in philanthropy?
Lee-Norah:Nonprofits can be the beneficiaries of trusts. This can facilitate tax planning and estate planning while also providing much-needed income stream to nonprofits and charities. In certain cases, what remains in the trust after a certain period can pass to another set of beneficiaries.
Q: Can you give us an example?
Lee-Norah: Let’s consider a Charitable Lead Trust (CLT). For a specified period, a charity is the beneficiary, receiving annual payouts as the fund assets are invested. At the end of that time, family members (or others) would receive all that remains in the trust, on and beyond the “hurdle rate” of return, which was recently 5% annually. The assets in the trust would not count as part of the trust creator’s estate and no gift taxes would be owed on the assets that eventually go to the final beneficiaries. Keep in mind that the “hurdle rate” is released monthly by the IRS (officially called the Section 7520 interest rate).
Q: What do you enjoy about working at LNW?
Lee-Norah: For me, this is an ideal place to work because of the personal integrity of the people here, the respect they command in the community, and the world-class expertise we offer clients.
Charitable Lead Trust In Action
Jacqueline Kennedy Onassis had arranged that upon her death (1994) her estate would be transferred to a Charitable Lead Trust (CLT) set up to last 24 years, all that time distributing money to charity annually. In 2018, what was left in the CLT was distributed to her grandchildren
LNW was actually founded as a trust company in 1967. So there is a lot of institutional knowledge here about trusts, their role in intergenerational wealth transfer, how to make them work for everyone involved, how to promote family harmony, how to create legacy.
We have a long history serving as the corporate trustee/co-trustee, managing the assets within the trust, and working with the beneficiaries so they understand how to make best use of the trust and become good ambassadors of wealth. Keep in mind that trusts are just one aspect of a wealth plan. The phenomenal level of expertise in-house at LNW allows us to integrate all aspects of a wealth plan, so that they all work together to achieve what clients want for themselves, their family and their community, often over many generations.
