The farther away from 8 posts i get, the more deserving of pity i become. And i just noticed my count. That’s it. I’m staying at this number forever. I’ll be lurking.
There’s a lot of truth in that one sentence, though. You didn’t even try to refute it.
LOL. Greenie I know you view yourself the king of debate techniques. What’s the term for troll who tries to get someone to do all the talking while not adding any value?
If you scroll back a few pages, I’ve contributed to this conversation beyond that one post. The ease in which government throws other peoples’ money at problems is symptomatic of a major problem: government is simply too big. I find it amazing when people clamor for more revenue (a perverse euphism for higher taxes) as if anything can be solved by an entity who has little to no incentive to reduce opportunity costs. Further, the government has shown no ability to spend within its means. The incremental borrowing that the government does every year is just delayed taxation that future generations are going to have to shoulder the burden of.
I’m not a huge fan of Reagan but he was 100% correct when he said that government is not the solution, it is the cause of problems.
^In order to be fair, I don’t think the estate tax is really supposed to be a means of raising revenue. It’s more meant to shape social policy. Whether that’s good or bad, or whether it achieves its end result, or whether government should be in the business of shaping social policy (and to what extent), these are other questions altogether.
I posted my first 2,000 in the Feedback Forum so no one would notice. Then - BAM - I dropped in like a pro.
Got this in one of my newsletters today. Though it might help.
http://ultimateestateplanner.com/2014/09/01/trusts-arent-just-rich-anymore/
Trusts Aren’t Just for The Rich Anymore
By Jonathan G. Blattmachr & Matthew D. Blattmachr
Many people associate trusts with the very wealthy, because they are often used in the media and pop culture in the context of two other words: “fund” and “baby”. The reality is that a trust is a helpful estate planning instrument for most of your clients, not just the wealthy. Clients with $250,000 to $1 million in investable assets should consider a trust to help tackle their estate and financial planning challenges.
Another reason trusts are commonly associated with the rich is because in the past for many families the cost of creating a trust was prohibitive. Additionally, many trust companies require a minimum deposit of $1+ million to open a trust. However, some trust companies, like Alaska Trust Company, tailor its services to meet the needs of your clients by allowing them to create a trust with as little as $250,000. Now your clients can enjoy the benefits that were previously only available to the very wealthy.
Another misconception about trusts is that they are only used to avoid taxes. Although trusts can be used for tax planning, they are also an effective tool for clients who want more control over how and when their assets are distributed to their beneficiaries. A trust can help in a variety of situations. For instance, people who plan to leave money to their children or grandchildren may not want them to have access to the money unless they are mature enough to handle it wisely. I have seen many cases where young adults have poor money habits. Fortunately, a trust can place effective controls on how and when the money is used.
Although an estate plan can use a trust as a tax saving strategy, there are many other objectives that a trust can achieve. Below I’ve provided a checklist that you can use to identify potential benefits for your clients.
Trust Situational Checklist
___ The client has concerns about family members or beneficiaries that cannot manage their financial affairs.
In this situation the estate plan can contain a trust that will prevent beneficiaries from squandering their inheritance and protect them from creditors, lawsuits and divorces. In some cases, you may even be protecting the heir from other family members and friends who want to borrow money.
The trust can be written in a way that will pass assets on to the beneficiaries immediately upon the client’s death, or the client can designate distribution over time in what amounts and even for reasons that they specify.
___The client is on their second (or later) marriage and/or has a blended family.
Families with second marriages and blended families present some additional estate planning challenges due to the various relationships involved. A potential hurdle is figuring out how to divide an estate when each spouse has children from a previous marriage.
For example, in a blended family, the husband may use a trust to make sure that his biological children are the beneficiaries of his life insurance benefits. Without a trust in place, it is possible that his current wife receives the benefits and when she dies, that money would pass to her biological children, leaving the husband’s children with nothing.
___The client is concerned about privacy.
Unlike a Will, which is public information, trusts are confidential. For this reason, people who want to protect their privacy can benefit from a trust. This can be helpful for clients who wish to maintain privacy over how and to whom their assets are distributed.
___Your client is in a relationship without specific legal status.
Unmarried couples miss out on the biggest estate tax break there is: the unlimited spousal exemption. The couple might assume that each will leave the other everything. While this is possible, the first to die will pay an estate tax and then the inherited assets will be included in the estate of the second person, who will then have to pay an estate tax on the same assets. Ideally in this situation they should leave property in a trust for the other to avoid paying taxes on the same money twice. Unmarried couples also need to beware of the consequences of unintended gifting during life. Rules about transferring property freely between husband and wife do not apply in this case.
___The client has a disabled child.
In this case, a special needs plan should be carefully designed to make sure the disabled child continues to receive their government benefits. Inheriting even modest assets from any source can cause them to lose important benefits such as health care and housing.
A Special Needs Trust (SNT) can be created to ensure that they will be taken care of once your client is gone. The SNT has two main benefits:
- The beneficiary can enjoy the assets that were intended for their benefit without disqualifying them from important governmental benefits.
- If the beneficiary lacks the mental capacity to handle financial affairs, the trust can be administered by either a family member and/or by a trustee who can look out for their best interests, giving your clients peace of mind.
___Client is a professional in a high risk occupation.
Assets that are transferred through a trust can be protected from creditors, which may be an attractive feature for people in professions that carry a substantial amount of risk such as business owners, doctors, architects and lawyers.
___The client has a business or holds an interest in such a business.
Passing the family business intact from one generation to the next is one of today’s most challenging estate planning problems. Especially, in situations where your client is trying to give the company over to one child who is active in the business while maintaining proportionate distributions to others who are not. Using a trust, you can help your client keep the family business in the family for years to come.
___Couples without Children.
Clients without children may be concerned about who will look a5er their financial interests later in life. By setting up a trust, they can appoint a trust company to serve as a financial fiduciary giving them peace of mind in case they are ever in a position where they cannot manage their own finances.
These are just some of the situations where your clients may benefit from a trust. To discuss a specific client or for help figuring out which trust may be right for your client please feel free to Alaska Trust Company at www.AlaskaTrust.com.
My dilligence revealed I’m too poor for a trust to be worthwhile. The rest of you BSDs can have at them! I have beneficiaries on all of my accounts which will suffice in the event of my eventual demise.