Passion Investing as a Spark to Your Life

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Bill Gates, Warren Buffet and over 50% of the Fortune 400’s The Richest People in America list have decided to give away their wealth for charitable pursuits. Of course, not many of us have that kind of money or are inclined to give away all we own. However, giving to charitable organizations is something that […]

Protecting Against Financial Fraud in Charitable Giving

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Americans are very generous when it comes to charitable giving. In addition, lower earners give more proportionately than higher earners. Perhaps this is because lower earners understand how easily a family can slip into financial crisis through the loss of a job or medical expenses. The thought of “that could be me” makes people very […]

The (Un)Usefulness of a Bypass Trust and How to Avoid the Consequences If You Are Stuck With One

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During the past several decades, estate planners recommended the use of AB Trusts for nearly every client. The use of AB Trusts was based upon the fact that the estate tax applicable exemption amount (“AEA”) was not automatically “doubled” if one was married. The AB Trust was developed to solve this problem, by providing that […]

Budgeting, Part 1: Budgeting as a Friend and not a Foe

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Budgets do control spending behavior. However, budgets also allocate resources to the areas of highest impact or interest. When a budget is structured based on priorities and values, much of the controlling element is removed. Using budgets at work is understood and expected. A company has a limited amount of money and so must allocate […]

Strategies for Those Awkward Financial Discussions

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There may be people close to you (spouse, parents, children) who are practicing financial behaviors that are unproductive or destructive. You want to help them get back on track, but you don’t want to come across as judgmental or condescending, or put them on the defensive. The Key Takeaways • Living within one’s means liberates […]

Who Should Be Your Successor Trustee?

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If you have a revocable living trust, you probably named yourself as trustee so you can continue to manage your own financial affairs, but eventually someone will need to step in for you when you are no longer able to act due to incapacity or after your death.  The Successor Trustee plays an important role […]

How to Choose a Trustee

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When you establish a trust, you name someone to be the trustee. A trustee basically does what you do right now with your financial affairs—collect income, pay bills and taxes, save and invest for the future, buy and sell assets, provide for your loved ones, keep accurate records and generally keep things organized and in […]

Organize Information for Your Family

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Think for a few moments about what would happen if you suddenly became incapacitated or died. Would your spouse or family know what to do? Would they know where to find important records, assets and insurance documents? Would they be able to access (or even know about) online accounts or files on your computer? Would […]

Why Does a Living Trust Cost More than a Will?

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It will probably cost more initially to set up a well-drafted living trust than to have a will prepared. A true cost comparison should include not only the expense to establish the will or trust, but also what it will cost should you become incapacitated and after you die. The Key Takeaways: A living trust […]

Providing for Your Parents in Your Estate Plan

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If you are part of the baby boomer generation (born between 1946 and 1964), you may also find that you are a member of the sandwich generation, with responsibilities to both your parents (now or in the future) and your children. This should change the way you think about estate planning—instead of the traditional approach […]

Estate Planning for Unmarried Partners (Part One: Planning for After Death)

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Estate planning is creating a set of instructions that specify how property is handled after death, and how property and health care decisions are handled during a period of incapacity. Proper estate planning is important for everyone. But for unmarried partners—opposite sex or same sex—it is critical. Part One of this two-part article will address […]

How to Leave Assets to Adult Children

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When considering how to leave assets to adult children, the first step is to decide how much each one should receive. Most parents want to treat their children fairly, but this doesn’t necessarily mean they should receive equal shares of the estate. For example, it may be desirable to give more to a child who […]

How to Leave Assets to Minor Children

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Every parent wants to make sure their children are provided for in the event something happens to them while the children are still minors. Grandparents, aunts, uncles and other relatives often want to leave some of their assets to young children, too. But good intentions and poor planning often have unintended results.   For example, […]

Incorporating Faith and Values in Estate Planning

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For many, passing along religious beliefs and values to the next generation is just as important as passing along financial wealth and tangible assets. Estate planning creates many opportunities to do this, including:   * End-of-Life Care. A health care power of attorney (Advance Directive in some states) lets you name someone to make medical […]

Estate Planning in 2013 and Beyond under the New Tax Law

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The recent tax legislation dealing with the “fiscal cliff” included significant revisions to the estate tax law that will affect estate planning for the foreseeable future. These revisions include:   *    The federal gift, estate and generation-skipping transfer tax provisions were made permanent as of December 31, 2012. This is great news because, for more […]

What to Do with an Inherited IRA

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IRAs are among the largest assets inherited by heirs and beneficiaries. These accounts have been able to grow to such large amounts because income taxes are deferred until the owner begins to take distributions, usually after reaching age 70 ½.   Those who inherit an IRA must be very careful to follow the rules, which […]

Estate Planning for Young Families

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Many young families put off estate planning because they are young and healthy, or because they don’t think they can afford it. But even a healthy, young adult can be taken suddenly by an accident or illness. And while none of us expects to die while our family is young, planning for the possibility is […]

Young Adults Need Estate Planning, Too

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Once a child turns 18, parents lose the legal ability to make decisions for their child or even to find out basic information. Learning you cannot see your college student’s grades without his/her permission can be mildly frustrating. But a medical emergency can take this frustration to a completely different level. The parents (or a […]

Planning For Incapacity and Long-Term Care

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Planning For Incapacity and Long-Term Care With people living longer due to advances in medicine and changes in lifestyle, odds are that most of us will become disabled for some time before we die and may need long-term care. Unfortunately, too few plan for an event that is more likely to be a probability than […]

Time is Running Out to Save Unprecedented Amounts in Taxes

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Time is Running Out to Save Unprecedented Amounts in Taxes For the rest of 2012, every American can transfer up to $5.12 million free of federal gift, estate and generation-skipping transfer tax—and estate planners are doing everything they can to motivate their clients to take advantage of this unprecedented opportunity. To understand why this is […]

Naming a Guardian for Your Minor Child(ren)

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Naming a Guardian for Your Minor Child(ren) Parents with minor children need to name someone to raise them (a guardian) in the event both parents should die before the child becomes an adult. While the likelihood of that actually happening is slim, the consequences of not naming a guardian are great. If no guardian is […]

Life Insurance: How Much and What Kind?

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Life Insurance: How Much and What Kind? Life insurance can be an affordable way to provide for our children, spouse, a sibling, aging parents and others if we should die while they are depending on us. Life insurance proceeds can provide extra income to help pay ongoing household bills and child care; pay off a […]

Estate Planning for Women

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Estate Planning for Women  While estate planning is important for everyone, women especially need to understand estate planning and have a plan of their own in place. Here are some issues that are of particular interest to women and their estate planning. Incapacity. Because women, on average, live longer than men, there is an increased […]

Using an Advisory Team

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The Advisory Team Approach to Estate Planning Estate planning is not simply the documents prepared by an attorney, nor is it the insurance and financial plan recommended by a financial advisor. Properly done, estate planning encompasses at least the legal and financial elements, but it may include more, as estate planning often points out the […]

Take Advantage of the Gift Tax Exemption

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Take Advantage of the $5.12 Million Dollar Gift Tax Exemption . . . Before it’s too late.  There has been a lot of media coverage about the Bush tax cuts that are set to expire on December 31, 2012 and whether they will be extended for all taxpayers or if they will be discontinued for […]

Four More Common Estate Planning Mistakes

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Here are four more common mistakes in estate planning. If your plan is in place and current, this will serve as more validation that you are on the right track. Feel free to share this information with friends and family members, especially those who may not have a plan in place.  1. Not having a […]

Family Values and History Are Still the Best Inheritance

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According to a recent study, family values, traditions and history still mean more than money as an inheritance.  These results are from the 2012 Allianz Life American Legacies Pulse Study* which surveyed baby boomers (age 47 to 66) and “elders” (age 72 and older). Allianz Life conducted a similar study in 2005. Interestingly, despite the […]

5 Common Estate Planning Mistakes to Avoid

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From time to time, it’s good to review why having a complete, up-to-date estate plan is so important. In addition to confirming our own actions, it can provide us with valuable information to pass along to friends and family who, for whatever reasons, have yet to act. So, here are five common estate planning mistakes […]

Defensive Estate Planning Series: Other Areas to Consider

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Other Areas to Consider There are many other changing circumstances that should be anticipated with flexible estate plan design. These include qualifying for California Medi-Cal benefits through authorizing the gifting down of incapacitated individual’s estate; minimizing income tax from distributions from an IRA account made payable to a living trust; minimizing generation skipping transfer tax […]

Defensive Estate Planning Series: Special Needs

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In the world of estate planning, the best offense to changes in the law and life circumstances is usually a good defense. Rather than running to court or the drafting attorney each time a crisis occurs, estate plans can be drafted “defensively,” such that several escape hatches or other planning options spring into existence whenever […]

Trust Funding Series: Assets that Don’t Require Funding

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Certain assets do not have to be funded to the revocable trust. For instance, retirement accounts and life insurance policies will remain outside the trust. Instead, these accounts transfer to named beneficiaries upon death. In these cases, greater attention must be paid to the beneficiary designation than to the title. It may, in certain situations, […]

Beneficiary Designation Series: The Wrong Beneficiaries

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            Sometimes, naming a beneficiary can result in disaster. For instance, naming an “estate” as beneficiary may result in probate proceedings in California when the plan and other probate assets exceed $150,000 in value. In addition, naming an improperly drafted trust as beneficiary could speed up distributions from the trust. Finally, […]

Beneficiary Designation Series: Trusts

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            Individuals should use extreme caution when naming a trust as beneficiary of a retirement plan. Most revocable living trusts—whether provided by attorneys or do-it-yourself kits—do not include adequate provisions regarding distributions from retirement plans. When a living trust fails to include “conduit” provisions which allow distributions to be funneled out […]

Beneficiary Designation Series: Naming a Charity

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            Many people wish to benefit charities at death. The reasons for benefiting a charity are numerous, and include: a general desire to benefit the charity; a desire to minimize taxes; or the absence of other family relations to whom bequests may be made. In general, leaving assets to charities at […]

Get Ready for These Five New Taxes on January 1, 2013

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Now that the health care law has been declared constitutional, several significant provisions will become effective on January 1, 2013 Tax #1: 3.8% Surtax on Investment Income This new tax will be levied on net investment income if modified adjusted gross income is more than the “threshold amount” based on filing status. For married taxpayers […]

Estate Planning After Divorce

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One area that is often overlooked in the divorce process is the need to update estate planning. Most people would agree that their ex-spouse is the last person they want to inherit their assets when they die—or to have that person make life and death decisions for them. But that is exactly what can happen […]

Paying for College

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According to the College Board, the average cost of attending an in-state four-year public college in 2011-2012 is more than $19,000 per year; for a four-year private college it is nearly $40,000 per year. Over the last decade, published tuition and fees for in-state students at public four-year colleges and universities increased at an average […]

Blended Families Underscore the Need for Estate Planning

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Anyone with children or modest assets should seriously consider some minimal estate planning, but the increasing number of blended families underscores the need for proper estate planning.  Blended families can involve children from a prior marriage as well as joint children, sometimes joking referred to as “his, hers and theirs.”  And blended families involve both […]

Estate Planning – A Process, Not an Event

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You have signed all of your estate planning documents and, if your plan includes trusts, completed their funding. You sit back, relax, and enjoy the peace of mind that comes with completing that task. But don’t bask in that feeling for too long—estate planning is an ongoing process, not a one-time event. In this post, we […]

Potential Problems with Beneficiary Designations

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Many clients use beneficiary designations, and for good reason. Some significant assets, including life insurance policies, IRAs, retirement plans and even bank accounts, allow a beneficiary to be named. It’s free, it’s easy, and, when the owner dies, these assets are designed to be paid directly to the individual(s) named as beneficiary, outside of probate.  […]

Estate Planning for Second Marriages

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In first marriages, the couple generally has the same goals when it comes to their estate planning: take care of the surviving spouse for as long as he or she lives, then whatever is left will go to the children. They may own many of their assets jointly and, at the death of the first […]

Online and Do-It-Yourself (DIY) Estate Planning

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With the number of online and do-it-yourself (DIY) legal providers continuing to grow, some of individuals may be wondering if they could do their estate planning themselves. The advertising is seductive: attorneys use similar forms, the cost is significantly less than hiring an attorney, and many of these websites and kits are created by attorneys. […]

Why You Should Name a Stand-Alone Retirement Trust as Beneficiary (For IRAs and Other Tax-Deferred Retirement Accounts)

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Naming the right beneficiary for tax-deferred retirement accounts is critical. Most people want to continue the tax-deferred growth for as long as possible, pay the least amount in income taxes and get the maximum stretch-out. Required distributions after the owner dies will be based on the new beneficiary’s age and life expectancy, so the younger […]

The Many Needs for Life Insurance in Our Lives

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The main reasons most people have life insurance are to pay final expenses (medical, funeral, burial, etc.), replace an income stream and/or create wealth for our dependents after we die. Life insurance can also play an important role in business, estate planning and charitable giving.  When considering whether or not you need life insurance, think […]

The Most Important Love Letters You’ll Ever Write?

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Many Americans have the misperception that estate planning is simply preparing for one’s death and is only necessary for the affluent. To the contrary, estate planning is as much about passing values to loved ones as it is about passing material possessions.  Thus it should come as no surprise that a recent Forbes article describes […]

Planning Opportunities Available to Affluent Families

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With the $5.12 million per person exemption from federal estate tax ($10.24 million for married couples), most of the estate planning “talk” recently has been on the planning opportunities available to affluent families. However, the need for estate planning remains for everyone.  According to a recent Forbes article, 55% of Americans do not have even […]

Using Advanced Irrevocable Trusts for Income and Estate Tax Savings: Making 2012 Count

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The next nine months are an exceptional window of opportunity for your clients to make family wealth transfers. The federal gift and estate tax exemption is $5,120,000, and both income tax rates and interest rates are at the lowest point in a generation. With federal deficit spending also at record levels, tax and interest rates seem sure to rise. […]

Planning for Advanced Asset Protection

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Asset protection is vitally important in our ever more litigious society, and more wealth planning teams are needed who understand the intricacies of this area and can collaboratively implement advanced strategies. Whether creating an entire plan for the client or creating additional asset protection measures added on to an existing plan, you want to know […]

Trust Funding Series: Options after Death for Unfunded Trusts

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Often, individuals pass away without fully funding their revocable trust. In these cases, a probate is ordinarily required in California when probate assets exceed $150,000. Probate assets exclude accounts that are held in joint tenancy or that transfer by beneficiary designation, but include real property, cash accounts, or investment accounts which are held outright. If […]