Interview with Mike Prior

By Brad Dupray

As president of Financial Planning Ministry (FPM) since 1994, Mike Prior has been assisting Christians with establishing wills and trusts that benefit Christian churches and ministries. FPM has arranged estate gifts for about 630 specific churches and 200 para-church organizations that total about $300 million. Before coming to FPM, Mike was on staff at Central Christian Church in Mesa, Arizona, where he served for five years as the business administrator and five years prior to that in children’s ministry. Mike is a certified specialist in planned giving and an attorney, having earned his juris doctorate from the American College of Law in Anaheim, California.

Define the primary ministry of FPM.

It is a ministry of stewardship education, specifically in the area of wills and trusts for estate planning.

Wills and trusts? Don’t most people prefer to use a living trust these days?

By far most people prefer to use a trust. The primary focus of a living trust is the estate can be distributed without the need of probate. Part of the stewardship training we do is explain how the various documents work and how a living trust estate plan will save significant costs in probate—by staying out of probate. We’re not here simply to create wills and trusts. We want people to understand the stewardship opportunity available in a living trust.

What is probate and what kinds of costs are you talking about?

Probate is the court administration of estates where people have not otherwise planned ahead to avoid it. The cost can be assessed on an hourly or percentage rate, but with legal and administrative costs, the total cost can be 5 to 10 percent of the total estate, or more. There are other issues regarding probate that people want to avoid, such as the time delays (it can take anywhere from nine months to two years to clear probate) and loss of privacy. All the records of an individual that go through probate are a matter of public record and are available at the county courthouse.

What about estate tax? Is that an issue for people, too?

It can be, but statistically it only affects about 2 percent of people. Certainly there are benefits of a trust, but estate taxes are assessed only on estates above $2 million. The estate tax rate is 40 percent or more on estates larger than $2 million.

Is the primary benefit of a living trust avoiding probate?

That’s one of several benefits a person will receive. Also, by having the documents in place they can name key individuals to take care of guardianship for minor children. They can name their own personal representative to carry out their medical wishes if they become physically or mentally impaired. And, the costs and delays of probate can be avoided.

At what point should a person begin to think about a living trust?

The average age is getting younger and younger. Once you start to accumulate assets, you should have a written plan for where they eventually go. If you start a family and have minor children you certainly want to designate who the guardians would be for those children if something should happen to the parents.

So for a young family it’s not too early to get started.

Children are an important reason to create an estate plan. A living trust is a document that is designed to live with you throughout your life. You hold your assets in the name of the trust. You name a conservator to be your personal representative if you are to become incapacitated. A will doesn’t have that power. A will only works after a person has died.

If it’s such a good idea, what keeps people from getting a living trust?

People agree that it’s a very good idea, and yet surveys show that 60 percent have no plan in place. The responses are often, “I don’t want to think about dying,” or “I’ve got too much to do,” “It’s too expensive,” or “If I make out a document now and I’m all done what’s the next thing that happens.” Mostly it’s just procrastination. Most people know it’s something they should do, but the legal system can be intimidating and costly. That’s why we get such a warm response by our approach to it.

What is your approach?

Our typical approach is to offer an information seminar at a local church. It lasts about 90 minutes, and we talk about the issues involving wills, trusts, probate, powers of attorney, guardianship, and the issues involved if a person doesn’t plan anything. Then we cover the basic steps they can take to avoid those problem issues.

Sounds like it can get a little heavy.

The seminar we put on is a very plain English, easy-to-understand format—our goal is to make it as understandable as possible. The most common response we get is, “Wow, I finally understand this!”

What is the cost involved in using FPM to set up a person’s living trust?

If we’re asked to set up an estate plan we don’t charge a fee for that service. Instead we encourage people we assist to include an estate gift to their local church and a gift to a select list of ministry sponsors that underwrite the cost of our work.

How does that compare with the cost of an attorney preparing the trust?

Usually legal fees can run $1,500 to $2,000, or more.

What specific benefit does FPM provide to Christian churches?

I think church members appreciate their church making this available to them. If an individual takes the time to indicate a gift to their own church in their estate plan, that church is being placed in a very special place in the life of that individual or family. They’re saying “everything in my estate I’m leaving to my loved ones,” and to have your church or ministry included is a significant part of that statement. “Where your treasure is, there your heart will be also.”

From a practical standpoint, most of these gifts are indicated as a percentage of the total estate. The average gifts we see are around $40,000. You multiply that by the number of individuals or families who support your ministry and that is a tremendous future source of ministry support.

Since the gift amounts are projected as “expectancies,” can a ministry really know what portion of that will come in?

We’ve been doing this for 25 years now so we have some statistics we can draw on. We have found that for about 10 percent of the estates we have written in the past the gift didn’t come through—either because the donor exhausted the estate or they changed the charitable beneficiary. But of the 90 percent that have come through, their estates appreciated in value over the years so that the appreciation more than made up for the 10 percent that didn’t come through.

Does a local church really need “windfall” gifts? What will they do with all the money when it comes in?

Our churches are trying to reach out into their communities. Imagine a church that had a flow of resources coming in from estate gifts so they could create a resource for the community to use, no strings attached, and the church just said this is our gift to the community. How many missionary organizations need additional funding? There are so many sources that the church could bless beyond their own buildings on their own property. And churches can even turn around and become sources of funding for important parachurch ministries that specialize in doing a certain function that the church doesn’t do but would like to support.

Why would a ministry with a development department need the services of FPM? Can’t they just do it on their own?

Many of the parachurch organizations we work with do have their own development departments. Many of them choose to use FPM as a part of it. We’re another tool in their toolbox. We’ve developed a program to be in the local church where many of those organizations’ supporters are. The advantage is that we may be able to get an audience that on their own they might not have.

How do you differentiate who someone should include for a gift in their estate?

There’s a wide variety of options available as to how people want to do their ministry gifts. It’s very common that their gift is shared between the local church and another ministry outside the church. Many times at a development department their focus is to get as many gifts as they can for their particular institution. We don’t require people to give to one specific organization. We don’t specify who their gifts have to go to. It’s easier for a church to invite in an organization that represents a broad number of ministries, rather than one specific interest.

Does bringing in the parachurch element to the local church decrease the amount people will give to the local church?

One of the concerns a church pastor is going to have is that gifts are going to be taken away from their church. What we have found is that this process is going to facilitate many more gifts for their church.

Does an estate gift seem to be a new concept to people?

The idea of planned giving is very new, certainly to our churches. Our church members understand tithing and many are very faithful in it, but many have never considered giving a gift to their church in their estate plan as a final statement of stewardship obedience. Our mission is to help individual church members know what that opportunity is for them, as well as for our churches and ministries.

Estate laws vary from state to state. How do you adjust for people who come to you from around the country?

We do that through a combination of working with local legal counsel and researching the requirements that are involved in each state.

How do people who don’t live in California get their estate planning work done by you?

We go out to the church to make a presentation. Then if someone wants us to assist them they’ll send their information to our office and we’ll meet with them. They have an option of working with local legal counsel or they can fill out one of the planning guides we use and send that to our office.

Do you have a living trust?

<laughs> You want to know if the plumber’s pipes are leaking? Yes, I have a living trust.

Am I a beneficiary?

At FPM we keep all this information completely confidential, so you’ll just have to wait and see. The question is, whose estate will mature first, yours or mine?

For more information about Financial Planning Ministry, visit

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