Trusts have become increasingly commonplace in estate and financial plans. A trust is a relationship whereby property is held by one party for the benefit of another. A trust is created by a Settlor, also referred to as a Grantor or Maker, who transfers property to a Trustee. The Trustee holds that property for the beneficiaries designated by the Settlor in the trust agreement. Assets held in an irrevocable trust are protected from creditors and other threats, In addition, they are not counted … [Read more...] about Should I include a trust in my financial and/or estate plan?
One of the most common mistakes people make is to under-estimate, or overlook entirely, the potential impact long-term care costs will have on their finances. With an average annual cost of over $100,000 for 2020, and an average length of stay of three years, a LTC bill can quickly deplete a retirement nest egg given the fact that Medicare will not pay for LTC. Medicaid will cover LTC costs but you must first qualify, a process that could put your assets at risk if you failed to plan ahead. … [Read more...] about How does long-term care factor into my financial planning?
When a participant in a retirement plan dies, benefits the participant would have been entitled to are usually paid to the participant’s designated beneficiary in a form provided by the terms of the plan (lump-sum distribution or an annuity). Many retirement plans require the account owner to name a spouse as the beneficiary unless he/she signs a form allowing the owner to name someone else as the beneficiary. The Employee Retirement Income Security Act (ERISA) protects surviving spouses of … [Read more...] about What happens to your retirement accounts when you die?
An IRA is a tax–advantaged retirement account that you own and control. Earnings generated can compound on a tax–deferred basis until withdrawal. In essence, an IRA is like having your own personal pension that you and/or your employer may contribute to for your retirement years. There are numerous different types of IRAs, the most common of which include a traditional IRA and a Roth IRA. Because each has different rules regarding taxation and withdrawals it is important to understand those … [Read more...] about What is an IRA?
The federal gift and estate tax is effectively a tax on the transfer of wealth. A gross estate includes anything a decedent owned at the time of death that has value. Without any deductions or adjustments to your estate, it could lose 40 percent of its value to federal gift and estate taxes. Both your financial planning and estate planning goals should take into account the impact taxes will have throughout your life and at the time of your death. … [Read more...] about How do estate taxes impact my estate plan?
Asset Protection planning should be part of any well thought out estate plan. Creating a financial plan that helps you amass a respectable estate and an estate plan that ensures your estate assets will be distributed accordingly to your wishes when you are gone only takes care of two-thirds of the bigger plan. You also need to protect the assets to acquire so that you will still have some left to pass down to loved ones after you are gone. … [Read more...] about Do I need to include asset protection planning in my estate plan?
Financial planning focuses on acquiring assets and building up your estate. A comprehensive estate plan will include numerous goals, including things such as ensuring that your assets are available to provide for loved ones when you are gone and making sure your wishes are honored at the end of your life. At some point, the goals of your financial plan with become entwined with the goals of your estate plan. For example, your financial plan will likely include retirement accounts. Those … [Read more...] about Why should I include financial assistance planning in my estate plan?