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What Can We Learn from Sam and Helen Walton?
by: Larry W. Gibbs

Contemporary estate planning causes a division of an estate and results in an ultimate dissipation of the resource base over a period of years. Is it possible to keep the resource base together to serve the family for many family generations? The Sam and Helen Walton story tells us how we can do so. The King Ranch story provides another illustration of what can be done.

Sam Walton's autobiography was published shortly before his death in April of 1992. Sam Walton writes about building a business and entrepreneurship. He also talks about the building of an estate plan. Most of the information I provide comes from the book. Other information comes from those who knew Mr. Walton or members of his family.

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Second-to-die life insurance has long been used by married couples to provide liquidity to pay estate taxes at the death of the second spouse to die.  Such insurance is less expensive and easier to obtain than two separate policies on the same individuals.

Now, life insurance that pays out at the first death is available. The Phoenix Companies, Inc., of Hartford, Connecticut, has released its Phoenix Joint Advantage universal life policy.  A single policy will insure two lives, covering couples who need cash for support when the first of them dies, and small business owners who need funds to purchase a deceased owner's interest.

The product has several options, such as a survivor purchase rider, which enables the survivor to purchase a new policy without undergoing further underwriting.

Given the usefulness of this type of policy for estate and business planning, I predict other companies will follow suit.

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Owners of family businesses face unique estate planning challenges.  Far too often, owners fail to plan properly, or at all, which can ultimately lead to higher estate taxes, conflicts among family members, and even failure of the business.  If you own a business - take a look at this entry and seriously ponder these 32 questions.

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