A forum for Hawaii's
business community to discuss
current events and issues
» Parenting grandchildren » PLA debate continues » Voice-over-IP calls
BACK TO TOP |
YOUR ESTATE MATTERS
Parenting grandchildren
Having responsibility for minor children
late in life makes financial planning critical
Grandparents fill a special role in the life of any grandchild. However, some grandparents raise their grandchildren and are the primary caregiver for them.
In fact, record numbers of grandparents now raise their grandchildren. According to the National Center for Health Statistics, approximately 5.4 percent of all children under age 18 live with a grandparent. Over 1 million households with children are headed by a grandparent without the child's parent present in the household.
The reasons for this trend are as varied as our society. They include a high divorce rate, an increasing rate of teenage and unwed pregnancy, an increase in the rate of incarceration (of parents), drug addiction, mental illness, AIDS and, of course, poverty.
If you have responsibility for your minor grandchildren, you must plan carefully so your grandchildren are taken care of in the event something happens to you. Because grandparents are older during the grandchild's minority years, planning becomes all the more important. Basic planning includes:
>> A will that designates who should care for the grandchild in the event of your death.If you have a considerable amount of assets, more advanced planning may be necessary, as well. For example, grandparents must be aware of the generation-skipping transfer (GST) tax. The GST tax applies whenever anyone gives assets to someone that is two or more generations younger than they are. The GST tax rate is between 45 percent and 55 percent, depending upon the year of the transfer. Each person can give at least $1 million without paying the GST tax. This tax is in addition to the normal estate tax. There are a variety of techniques than can be used to pass assets for the benefit of grandchildren without paying the GST tax.>> A general durable power of attorney designating someone to make financial decisions for you in the event you are unable to do so.
>> A health care power of attorney designating someone to make health care decisions in the event you are unable to do so.
>> A "HIPAA" authorization form which allows the release of medical information for you and your grandchild.
>> "Medicaid triggers" in your documents to allow Medicaid planning so that your assets can be arranged to enable you to qualify for Medicaid for yourself, your spouse, and your grandchild.
>> Paying the grandchild's tuition and medical expenses. As long as the payment is directly to the provider, no GST or gift tax is triggered.Raising a grandchild can provide a stable, loving environment for the grandchild. Effective planning can help ensure that stability continues, to the extent possible. A qualified estate planning attorney can help you plan for your grandchild's future, as well as your own.>> Setting up a "grandchild's trust." A grandchild's trust is a trust that is irrevocable and must be used for the benefit of a particular grandchild. At the grandchild's death, the assets are included in the grandchild's estate for estate tax purposes. Transfers of up to $11,000 each year for the grandchild may be free from gift tax. If you are married, this amount may be doubled.
Attorneys Judith Sterling and Michelle Tucker are certified public accountants and partners in the Honolulu Law Firm of Sterling & Tucker. Reach them through their Web site, www.sterlingandtucker.com . For a free copy of "Where There's a Will, There's Probate" call 531-5391, Ext. 0.
BACK TO TOP |
Unionized builders'
group argues PLAs
don't harm competition
On March 28, a column was published in the Honolulu Star-Bulletin regarding project labor agreements (PLAs). The letter, submitted by Robert Hugh Joslin, chairman of the board of Hawaii's Associated Builders and Contractors, provided a narrow view on the subject. I'd like to provide additional information in order that readers can have a more complete understanding of what a project labor agreement is, why a company, developer or government entity might consider one and why a PLA would be advantageous in Hawaii's current economic climate.
A PLA is implemented in order to iron out all labor issues upfront and eliminate unknowns that might cause project delays and cost overruns. For example, PLAs establish wages, benefits, uniform work schedules, rules for dispute resolution and could even include a no strike clause. It is important to note that PLAs are not exclusive to unions and do not automatically exclude non-union members. PLAs may provide for union and non-union workers alike. Each PLA is unique and is tailored to the needs of a particular job.
A PLA allows the involved parties on a project to come to agreement on key issues, such as wages, before embarking on a long-term project. It's like locking in on an interest rate before you commit to a 30-year fixed mortgage. Your mortgage payment, for the most part, is then set for the next 30 years and you can plan accordingly. It's a similar situation with a PLA. When wages are agreed upon and locked-in upfront, the developer can plan accordingly and there should be no surprises along the way if labor market conditions change. Not having a PLA in place is like taking out a 30-year adjustable rate mortgage. You just don't know what to expect down the road.
With double-digit growth projected for Hawaii's construction industry for the next 5 to 10 years, it would be ill advised for a company or government entity to launch a long-term project such as the military housing privatization projects without PLAs in place. As Hawaii's construction industry booms, the demand for labor will increase, the supply will no doubt get tighter and labor costs will reflect these changes. A PLA that has locked in wage costs brings stability to the planning process for large, long-term projects.
At Pacific Resource Partnership, the joint market recovery program of the Hawaii Carpenters Union and unionized building contractors, we have long been advocates of enlightened labor-management relations that are built on long-range planning and open communications. The very mission of Pacific Resource Partnership resonates with the essence of project labor agreements.
Open competition will continue in Hawaii throughout the surge of construction activity. There will be an abundance of work for all qualified workers in Hawaii. With the significant amount of work, it is likely that contractors will be competing for qualified workers more than competing for jobs. Those with long-term projects who don't have PLAs in place may be in for a wild roller-coaster ride.
Bruce A. Coppa is managing director of Pacific Resource Partnership.
BACK TO TOP |
TECH VIEWPhone calls over the Internet
are now an easy-to-use reality
I don't often use the term killer app, but Voice over IP services such as Vonage, a system that uses the Internet to easily and inexpensively make local and long-distance phone calls, is pretty close.
When making phone calls over the Net first became available to the general public a few years ago, it was a complicated pain in the okole. The quality of calls was marginal, and you had to use your computer to make the connection -- if you could make a connection at all. Sure, it was free, but the time it took to get the call completed was usually not worth the effort.
Thankfully, those days are over for good.
Vonage not only can save a person a great deal of money, but also provides advanced telephone features that Verizon cannot offer (at least not in Hawaii). Vonage has made Internet phone calls as easy as using your regular phone. In fact, it is used exactly like your ordinary phone except that it's linked to a broadband connection such as a cable modem or a DSL line. (You don't need a computer to do this).
All you need is your regular home phone and a VoIP service to place calls via the Internet to any phone number anywhere in the world.
I've been using Vonage the last few weeks, and I'm pretty impressed. Set-up is a piece of cake. All you do is take an Ethernet cable and plug it into one of your router's ports and then plug the other end into a Vonage device that's about the size of a CD jewel box. Next, plug your phone into the same Vonage box. From then on, use your phone as you normally would.
In most instances the quality of my calls has been excellent. On occasion calls have broken up, but in most cases -- especially with calls to the mainland or even Europe -- I noticed no difference between Vonage and the standard network.
I tested this system thoroughly and made calls to a variety of areas, including Thailand, California, New York, Atlanta, Belgium, Tahiti, Fiji and Mexico. The vast majority of the time, the system was flawless. In a call to Thailand, I reached a friend on his cell phone in a very remote region (the village of Pai) near the Burma border. My friend complained of a "tin can" sound, and it was difficult at times to understand him. But honestly, it may have been just as difficult to hear him in that area without Vonage.
I also once had a problem calling Fiji -- in one instance the caller on the other end couldn't hear me.
OK, so it's not perfect -- perhaps 99.9 percent. Vonage offers a three-tiered service that costs $15, $25 or $35. The least expensive plan provides 500 long-distance minutes anywhere in the United States, and the $35 plan offers unlimited calls to the mainland and Canada. However, you need to provide broadband Internet access. You can share your connection with your computer, but if you don't have it already, just beware it is an additional cost.
International calls are a fraction of Verizon's long-distance tariffs. For example, calls are 3 cents a minute to Tokyo, Berlin and Sydney and 2 cents per minute to Hong Kong, Paris, London and Rome.
By comparison, Verizon offers a $60 plan with unlimited local and long distance for mainland customers (using the regular phone network), but reportedly it will not be available in Hawaii until June.
You can check out rates and plans at www.vonage.com.
All plans include services such as voice mail, call forwarding, caller ID, call waiting, call transfer and three-way calling that you'd pay for separately with Verizon.
In addition, Vonage offers a number of features that Verizon cannot compete with. For example, you can choose a new number, free of charge, from nearly any other area code in the country. Vonage is not set up for Hawaii area codes yet, but using this service, you could conceivably be in Honolulu and have a San Francisco phone number.
All calls to another Vonage member are free.
Vonage also provides so-called "virtual phone numbers" for an additional $5 a month. These virtual numbers can be in different area codes, and all incoming calls are routed to your phone. Thus, if you wanted to have an extra number in Seattle where your daughter lives, she could call you at that number and it would be a local call but ring on your Honolulu phone.
You can also manage your account and check your voice mail on the Vonage Web site in the form of e-mail messages with sound files attached. You can also take your Vonage box with you and use it to call anywhere you have broadband. For example, I took my box with me to the Big Island and used it to make calls nationally and internationally.
What are the disadvantages?
Voice quality is good most of the time, but it can break up if there's excessive traffic on the Net. If you use Vonage, your local 911 services won't be able to automatically find you. It is possible, however, to activate 911 dialing on Vonage's Web site. Vonage also doesn't list numbers in the phone book. As I mentioned earlier, 808 area codes are not yet available, but you can still use Vonage to make local or long-distance calls.
Vonage is a very cool service, but note that other companies are also starting to offer service. If you spend a lot of time calling the mainland or overseas, I would seriously consider this technology.
Kiman Wong, general manager of Internet services at Oceanic Time Warner Cable, is an engineer by training and a full-time computer geek by profession. Questions or comments should be addressed to kiman.wong@oceanic.com
To participate in the Think Inc. discussion, e-mail your comments to business@starbulletin.com; fax them to 529-4750; or mail them to Think Inc., Honolulu Star-Bulletin, 7 Waterfront Plaza, Suite 210, 500 Ala Moana, Honolulu, Hawaii 96813. Anonymous submissions will be discarded.
