Updated: Nov 8
Were you born in the mid 1960's to mid 1980's? Then you're in the Gen X Generation. You had a cool childhood and got to experience all of the tech developments as a kid, so you're a tech expert.
You're around 35 to 55 years old, and have a way to go until you are in your retirement years. So now's a good time to not waste this window of opportunity to get your financial life set-up for long-term success.
Let's talk about the financial documents you should have.
Revocable Living Trust
By now, you should have a will and a revocable trust set-up for yourself. If you don't, that's mistake #1.
But, it's not too late. I'm hoping that if anything good will come as a result of our planet experiencing this Covid-19 pandemic, is that people will finally see the need to be prepared for the worst. I know, it's something we don't want to think about, but we have to. We're not kids anymore, were adults, and especially if you have a family, it's your responsibility to protect your spouse and kids. (sorry, I don't mean to lecture!)
It's just that, in my many years as a financial planner I've seen lots of disasters that happen to nice families that ignored this advice.
Here's a list of well-known people that recently passed away without a will or trust:
Recording artist Prince, Actor Chadwick Boseman, Singer Aretha Franklin, and Singer Amy Winehouse.
They certainly had the resources to have their assets protected with a will and a trust. But they never got around to it. It is perfectly understandable because we don't want to think about the fact that we're going to die one day.
You may be thinking to yourself, "I'm not a multi-millionaire yet, I don't need a trust". Well, I'm here to tell you that you do. It's really not expensive to set-up. My firm has a partnership with a trust company that offers the best protection for you and your family. Here's what a revocable"living" trust can do for you.
Protect your assets from lawsuits and creditors
Estate planning: assure your wishes are carried out
Tax reduction or elimination
Probate avoidance (probate costs a lot of money, and there's no privacy: the whole world will know everything about your finances)
Sale of your business; reduce your taxes through a trust
Charity and philanthropy
Supporting individuals with special needs (guardianship/conservatorships)
Trust assets that can last for multi-generations
Protect heirs/beneficiaries from mismanagement of funds
Competent third-party fiduciary oversees trust. Prevents conflict within family
A trust can help provide income for a second or third generation, and possibly, beyond
Where your trust is located matters
Mistake #2: your trust is set-up in the wrong state
Your trust should be set-up in the right state to reduce or limit your taxes. Also knowing the right state will allow for more privacy for your trust. You don't have to set-up your trust in the state you live in. By using these legal strategies, you will be giving yourself and your family the best protection under current tax and trust laws.
The attorney you select may be conflicted
Mistake #3: selecting an estate attorney in your state to create your documents.
First, you need to know if it it would be better for you to get your documents set-up in another state. Attorneys are usually only licensed in the state they live and do business in. Let's say you live in California (a high tax state) and you need to get your will and trust created. Should you have a California attorney create and set-up your documents in California? Probably not! State taxes in California are high. The California attorney may not want to lose your business, so he/she may not tell you that it might be better to have your trust created in another state.
It would be best to get advice for an advisor that is a fiduciary and has no financial incentive to influence your decision.
In conclusion, according to a recent survey, people know they need these documents, it's just that they don't know where to start.
We can help! We can walk you through the process, help you gather and organize the information and work with the trust company to get it done. You will save time and money working with us. Also, don't worry if you don't know all of the answers to the choices you need to make. We can always revise and update your documents as needed. A trust is sometimes called a living trust because it is created and managed while you are living.
if you have a will and trust that were created some time ago or you don't have any documents at all, give us a call. It won't cost you anything for the call. We'll discuss your situation with the trust company that we work with. We are fiduciaries, so we'll give you the advice that is in your best interest. I think it will give you and your family a lot of peace of mind to have this protection in place. I wish the best for you and your family.