Archive for Retirement and Estate Planning

The Parable of Two Brothers and 2 Acres of Land

Lifetime Gifts versus Transfers Upon Death

 

You have two options when it comes to transferring and passing your assets to your heirs and beneficiaries.  You can give them away during your lifetime or you can transfer them upon your death.  It’s your call.  Is one option necessarily better than the other option?  It always depends on the facts, situation, and the circumstances.  Think about the following:

 

 

The Parable of Two Brothers and 2 Acres of Land.

 

Shortly after the Great Depression of the 1930’s, two brothers, Allen and Bob, were walking over some land in south Florida when they spotted a “for sale” sign.  The sign said “2 Acres at $500 per Acre”.  The two brothers made a deal to buy the land for $100 down and $100 per year for the next four years.  During this time, the brothers worked together to make the payments sometimes loaning money to the other to do so.  At the end of four years, the two brothers were the proud owners of two acres of everglades and swampland with the significant investment of $500 per acre.  They had no way of knowing what would happen to enhance the value of those two acres through several generations of family transfers. (more…)

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Using a Trust to Avoid Probate

Should I transfer my assets to my heirs before I pass away so there will be no probate administration when I do pass away?  I get this question all of the time.

 

It is definitely possible to do this but there are several issues to consider.  Generally speaking, this approach is not high on my list.  I prefer to use a living trust.  There are several advantages of a living trust.  Let’s take a look at a few of the advantages. (more…)

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The Need for an Estate Plan

Question:  When should you have an estate plan?  Is it when your estate has a value of more than $5.49 million, more than $10.98 million, or some other number?

 

There is one purpose and one purpose only for an estate plan and that is to deal with the division and distribution of your assets upon your death.  That’s it – period.  Nothing more, nothing less. (more…)

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Remembering Your Pets

Scientific research has documented the positive affect that pet ownership can have on one’s life. There has been a pet in our home for over 30 years except for a period of about 6 months. We could really tell there was a void during those months when we were without a pet. Needless to say, we have filled that void and now our home is run and ruled by a rotten little 7.4 pound scoundrel.

 

Our more mature citizens often fear becoming a pet owner. Even though they understand the benefit of pet ownership and the love, attention, and devotion that a pet brings to the home, they have an overriding fear for the continued care of their pet should their pet outlive them. That is a very understandable, admirable, and unselfish trait. They do not want to run the risk that their pet which is so near and dear to them could end up being abandoned. (more…)

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Beneficiaries – Your Obligation To Monitor

When you purchase a life insurance policy, write your will, or set up an IRA retirement account, you go through the process of naming a beneficiary to the account. It is on your mind and part of the process to set up the account and you take care of it. Hopefully, you have also named a contingent beneficiary in the event the first named beneficiary predeceases you. But time passes us all by and things change. Life changes with births and deaths and also with marriages and divorces. It may have literally been years since you looked at your documents and considered if your named beneficiaries are still fitting your needs and purposes.

I often ask “do you positively know, for sure, beyond any doubt, who are the primary and contingent beneficiaries of your IRA account?” I asked this question the other day and I could tell there was clearly a pause of uncertainty. What brought about this discussion was that a semi forgotten IRA account that had not been thought about for quite a few years had raised its head. (By quite a few years, I mean enough years had passed that he a gotten married, had a child who was now a teenager, was now divorced from the teenager’s mother, and has remarried.) Obviously, a large block of time has passed. (more…)

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