If you are in the inheritance boat, then you might want to make sure you don’t sink it!

Distributions from inheritance can put heirs in tax situations they never dreamt possible. In my experience, I have seen heirs inherit estates that should have put them in a better financial position, yet because of the decisions of the heirs, left the heir with almost nothing.

There are many ways to shield Uncle Sam with proper pre-death planning, however, many times a client may inherit money with no wealth transfer plan. In these situations, individuals should consult a knowledgeable financial advisor who is current on estate planning issues BEFORE monies are distributed from insurance companies, retirement plans, brokerage accounts, bank accounts, etc.

By consulting a financial advisor, you may be able to save giving Uncle Sam a big part of your inheritance. Many times, accounts can be stretched over lifetimes of the heirs which will result in monies being given to Uncles Sam over the years, and not all at once. This could keep you in a lower tax bracket and enable you to keep more of your inheritance.

If you would like independent, unbiased advice,  on pre-death or post-death estate planning, please call my office for a free consultation.

Many clients are referred to me after they go through a divorce. The problem is, they have already completed their divorce and now have to deal with the consequences. It’s unfortunate that they didn’t consult a financial advisor prior and during their divorce.

A commonality in many of my divorced clients is that they got stuck with non-income producing assets. They went through a divorce and thought they were getting a good deal because they got to keep the house. They assumed that because the house had equity in it that they were getting a good deal. Many times, they even fought to keep the house.

Meanwhile, the ex-spouse walked away with the majority of the income producing assets – i.e., a pension, 401(k) or other retirement plan, and brokerage accounts.

What’s wrong with this picture?

The spouse with the house has to now pay a mortgage that many times they can’t afford. The equity in the house just sits there while the ex has assets that can produce monthly income. If the divorcee consulted a financial advisor before or during their divorce proceedings, they would have had a better idea of what to fight for.

So, if you or someone you know is going through a divorce, call me and I can show you what to fight for!

With many companies offering buyouts, many people are left wondering what option they should choose. They think that the problem is whether or not the company is offering enough money, however, there is more to it than just the amount of money being offered.

Lately, I have seen clients come in with buyout papers that makes the client sign off on ERISA rights and pensions. Everyday, individuals are signing off their rights to retirement and pension laws, in order to receive a lump sum. Clients see a lump sum of money and don’t consider the fact that the money will be taxed. Often, this lump sum will throw a client into the highest marginal tax bracket possible.

Clients are advised to seek out advice from an attorney or financial advisor when they receive their buyout offer letters, but a big percentage of individuals don’t do this. Instead of seeking professional advice they make uninformed decisions. These decisions usually have lasting negative consequences that the individual didn’t bargain for.

So, if you or someone you know has been offered a buyout, seek professional advice. The time and money you will spend could potentially end up saving you money in the future!

Times are a changing & maybe your insurance should too!More often than not, individuals buy life insurance policies from an insurance agent and that is the last time they talk to their agent about their policy. This isn’t good.

The bad news: If you bought a permanent policy, do you really know how it works? Permanent policies have a cash value that supports the death benefit and is based on a rate that the policy originally was hypothetically expected to earn. The problem is that many policies issued in the 1980’s and 1990’s were issued at high hypothetical rates of 10% or more. Unfortunately, most policies have not been able to earn these high rates, which means that even though you pay your premium every year, your policy could be at risk of defaulting, which means you would have no coverage.

The good news: In recent years, life expectancy has increased which has made rates drop. Policies issued in the 1980’s or 1990’s are typically outdated. If you are still insurable, it is possible that you may qualify for a more cost effect policy.

If you bought a permanent insurance policy and would like a free review, please call my office.

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