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  Private Banking Can Help with Philanthropy
Posted by: it-man - 07-30-2015, 05:08 AM - Forum: Charity & Giving - Replies (1)

Giving money away can be just as complicated as making it. Private bankers help spread the wealth.

Private bankers help clients to guard their wealth; they also hold their hands when it’s time to give some of it away.

“Many times clients are interested in donating, but they don’t really have the people to sit down and have a dialogue with,” says Nicholas Stonestreet, head of Trust & Wealth Structuring at Merrill Lynch International Private Client Group. “It’s a really important part of private banking.”

Stonestreet encourages his staff to ask clients about their philanthropic intentions. Like therapists exploring personal problems, charity experts at private banks can help donors think through their altruistic inclinations and motives.

Will the client get more out of giving while still alive or after death? Some may want a foundation to carry on their legacy forever; others may want the bequest spent out at some point.

The tax implications of giving are a frequent concern. Though the U.S. leads the world in tax breaks for charitable giving, other countries are catching up. In recent years the U.K. has improved its Gift Aid plan, introduced in 1990 to allow charities to reclaim basic-rate tax (now 22%) on one-time cash donations of at least £250 ($390), by eliminating the minimum amount and allowing income tax deductions to those donating stock. This year Canada indefinitely extended legislation that halves to 25% the amount of capital gain subject to tax for gifts of public securities made directly to charities.

Private bankers will help structure a donation to maximize the writeoff, selecting the best asset and even seeing to the completion of the transaction. Sometimes an offshore trust is advantageous for tax or other reasons; private banks have always known the score there.

As philanthropy becomes more widespread on the giver end, so too are receivers becoming more active. Banks can set up a screening service for pleas and proposals from would-be beneficiaries. Researchers can also identify charities that meet a client’s criteria, assist in establishing boards and policies for foundations, even act as secretary for the family office.

The fees for these services, as with many others in private banking, aren’t low. At the Royal Bank of Canada, the cost ranges from 1% to 2% for a $1 million foundation, according to Jo-Anne Ryan of RBC in Toronto. But that’s still less expensive than hiring a staff that could cost $70,000 a year and renting and furnishing office space for an additional $20,000.

“Giving away money is really hard,” says Adele Simmons, a senior adviser to the World Economic Forum and a former president of the John D. & Catherine T. MacArthur Foundation, which has assets of $4.2 billion. “It takes a professional staff to evaluate a [charitable] organization, examine its accounts and assess whether or not its strategy is going to make a difference.”

In a family situation, the private banker will help to imbue children with a sense of giving. Schroders Private Bank, for example, hosts seminars for adolescents to help them decide what causes they want to support and how, covering both local projects and efforts abroad.

Whether you’re planning to give away $10,000 or $10 million, now or later, it can be every bit as challenging as an investment diversification. “Philanthropy really is another business,” says Joanne Johnson, the managing director of J.P. Morgan’s wealth advisory group. “And that’s how people should approach it.”

(This article coppied from this URL - http://www.forbes.com/global/2002/1014/055.html)

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  23 Critical Questions to Ask When Hiring a CPA
Posted by: it-man - 07-30-2015, 05:04 AM - Forum: Things the Wealthy Do - No Replies

Question # 1: Is timely service delivered?

Accounting information can get out of date quickly. Except for annual information, most accounting information should be no more than 10-30 days old. You should be able to access your up-to-date information and your CPA quickly and easily.

A proficient CPA makes it a habit to get back to clients as quickly as possible. Phone messages should be replied to the day they are left - or no later than the following day.

Question # 2: Do the same people always service your account?
Ideally the same person should work with you -- not whoever is available at the time. That way a relationship can be built where the accountant and you are comfortable with each other.

Question # 3: What services beyond the usual reporting and number-crunching are offered?
A CPA needs to be more than a data entry clerk. It's their duty as an adviser to make sure the information they receive makes sense. If it doesn't, they should ask questions and seek clarity.

Question # 4: How can the accountant help you make more money?
It sounds like a wise-guy question, but the answer will help you find out if candidates are interested in your business. Did they review the financial information you provided prior to the interview? Did they make sure you understood the accounting concepts, instead of tossing off a bunch of jargon?

A proficient CPA's goal to save you more in taxes -- it is also in his best interest that you succeed.

Question # 5: Do you believe I'm paying too much, too little, or just the right amount of tax?
Beyond simply preparing tax forms, an accountant should be involved in business planning throughout the year. Typically, a quarterly review should be scheduled to ensure books and records are in order. This also allows the CPA time to advise clients about their businesses so they function with peak tax efficiency.

Because most business owners pay too much in taxes, a proficient CPA will analyze the tax situation from the form of entity to all legal means to plan and minimize all taxes paid.

Question # 6: Do you consider yourself tech-savvy?
Small business accounting software has made powerful accounting tools available to everyone. But these accounting packages (most notably QuickBooks) are only as useful as the person who installs and runs the application. For this reason, a proficient CPA will help you install and set up a set of books, while also requesting them for review.

Question # 7: Who are your other clients?
Imagine this scenario: You hire an accountant based on the assumption he understands the basics of your business. Then, you find out he's never had a client like you before. Instead, he's only prepared tax forms for wealthy individuals who don't own businesses. Avoid this disaster by asking about the accountant's clients. If they are businesses similar to yours, that's a good sign. In asking about clients, you will also want to understand the CPA's work schedule and whether he has the time and resources to support you adequately.

Question # 8: What kind of creative business advice will you offer me?
Advising clients on what they can do to grow and set goals, as well as discussing issues, are all part of a proficient CPA's services. Together, this allows you to discover what works for your business so funds are used wisely.

Question # 9: Why should I use you?
Ask the question and just listen for the answer. You should feel like the CPA really cares about your success.

Question # 10: What kind of credentials do you have?
Tax professionals are usually certified public accountants (CPAs), enrolled agents (EAs) or unenrolled preparers.

Question # 11: How much professional education do you get annually?
Just passing the test to be a CPA or an EA isn't enough. With the tax code and interpretations of the code changing every year, continuing education is really essential. EAs are required to have 72 hours of continuing education in a three-year period; each state sets its own requirements for CPAs. In Oregon, for example, CPAs must take 80 hours of continuing education within a two-year period. Many tax professionals take more than the minimum requirement for continuing education. Although more training doesn't necessarily mean the tax pro will be superior, it's certainly not a bad sign.

Question # 12: Who will I be interacting with?
Many tax firms assign more than one person to a client's return. You probably don't need to know how the "back room" operates, but you want to know if the person you're interviewing is the one who will be able to answer your questions about your return.

Question # 13: What's your policy on returning phone calls?
A common complaint often heard from consumers about their CPAs is about long wait for returned phone calls. CPAs aren't famous for their communication skills. It's not unreasonable to ask how long you should expect to wait to have a call returned. Asking also lets your CPA know you do want your calls returned promptly.

Question # 14: Are you available outside of the tax season?
Some tax preparers are seasonal. They are available only the first four months of the year, or their offices are close for a few months each year. If you expect year-round access, you need to make sure the tax professional is available.

Question # 15: Are you a corporation of CPAs or an individual CPA that has their own business?
If you opt for the corporation, find out if you'll be dealing with one particular person, or will it be whoever answers the phone when you call. It's best to have one person to build a relationship with.

Question # 16: When do you work?
What are the CPA's hours of operation? Make sure that you can call him at hours that are convenient for you.

Question # 17: Do you conduct your own business and personal affairs in a reasonably efficient and sensible way?
Ask questions about the CPA's approach to getting and serving clients, the role of staff, the use of technology - including computers, communications equipment and the Internet -- as well as ways of keeping current, research methods, management of files and records, etc.

Question # 18: Will my computer and/or I be serviced by you, a partner or junior accountants?
Many CPA firms train new associates at the client's expense. Be sure you get what you pay for.

Question # 19: How are your fees calculated? Will you be charging me for every phone discussion?
To avoid friction later, it is essential to discuss the CPA's fee structure. Tax professionals may bill by the hour, form, overall return or some combination. After reviewing your previous returns and interviewing you, a tax professional should be able to give you a good-faith estimate of costs. If the CPA uses a time-based system, discuss the hourly rate of the accountant and staff, overhead expense reimbursement (what is the cost of a fax?) and whether certain time is not billed.
Find out now whether a simple two-minute phone call or a one-page fax means an hour of billable time. If that's the case, run for the door.

Question # 20: What can I do to help you with your work and keep your fees to a minimum?
A great deal of your accountant's time can be saved by preparing information beforehand. Find out if your CPA is willing to work with you to off load this work to your firm.

Question # 21: Do you perceive any conflicts of interest?
CPAs work for dozens of firms and scores and sometimes hundreds of individuals. You should inquire if any of your direct competition is represented by the firm. If so, inquire as to how this conflict is handled.

Question # 22: How long have you been a Certified Public Accountant, and what other licenses do you hold?
You should inquire with the state CPA organization to discover if there have been any disciplinary actions entered. Some accountants also have credentials as financial planners (PFS), securities representatives, business valuation experts, even lawyers. Check web directories and websites (e.g., http://www.CPAdirectory.com)

Question # 23: How well have you integrated computers and the Internet into your practice, and has it enabled you to do more for the clients at less cost?
Integrating your computer files with your CPA's files can save time and money -- and increase accuracy. Doing so over the Internet makes it even simpler. Find out how your CPA uses the Internet. Does he have his own website? If so, check it out and ask questions about the resources available on it. Find out how you can interact with him and his computer systems to make work flow more efficient, while enabling both of you to stay in touch.

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  10 Due Diligence Questions To Ask When Selecting An Asset Protection Attorney
Posted by: it-man - 07-30-2015, 04:31 AM - Forum: Things the Wealthy Do - No Replies

#1: Are you a lawyer or part of a law firm that will keep our discussion privileged?
Remember that dealing with
“promoters” or LLC Mills does not provide the skill set and training required. More importantly, if you are not dealing with a law firm that allows all your communications to be attorney privileged everything you do is discoverable with a simple subpoena, including all emails and other communications.

#2: How many clients have you done this specific type of planning for?
An East Coast law firm has nearly plagiarized the of my associates. On it they claim to serve thousands of clients and be a top asset protection law firm. Closer examination of the site reveals that they have a dozen plus distinct practice areas and are simply intentionally misrepresenting that client base as if all of it is with Asset Protection clients. Be very specific and watch out for this common legal bait and switch their team is suggesting in big seminars.

#3: What’s the average net worth of your clients?
It’s important to deal with a lawyer and firm that has a depth of experience with businesses, assets and families like yours. Knowing what your liquidity needs are and not using outdated estate planning tools that are not income, business and age appropriate (like using a QPRT for a 33 year old) are common amateur mistakes we see other lawyers make. Also, be aware that a number of different specialties now classify themselves as “Asset Protection” planners when it was formerly used only for the kind of pro-active, defensive legal planning I am focusing on in this article. The field now includes elder care lawyers, annuity and insurance salesman, and a variety of other folks that may have good products and services, but are probably not what you are looking for. If your planner is an Elder Care planner, as one example, they are probably not equipped to handle and as familiar with the needs of a high net worth business owner, physician, or high visibility individual like a professional athlete or entertainer.

#4: Where do you work?
Having a law firm that works nationally is a good hedge. It’s important that they understand the protection available by statue in your locality, and give you a plan that will stand up to attacks in any jurisdiction. It’s also important that it is portable, so it can travel with you if you move and flexible enough to allow you to do business and own assets in more than one jurisdiction, i.e., something as simple as a vacation home in another state, or a life insurance policy with a high cash value that could be lost in a lawsuit.

#5: How many types of law do you practice and how long has Asset Protection been part of your practice?
See my more detailed explanation of this concern at the opening of this article. Make sure you are comfortable with their experience level. Lawyers are increasingly specialized and while many of have a good general knowledge of a variety of concepts and issues we tend, like all professionals, to be good at only one or two on a good day.

#6: How many doctors do you protect?
This is obviously a doctor specific question, but an important one if you are a physician or the adviser of a physician doing due diligence on their behalf. In my experience with a client base that includes thousands of doctors, we have learned that medical professionals of all types including MD, DDS and DC have unique needs and specific technical and legal exposures that only get more onerous as their success grows. Make sure the planner you are dealing with understands those unique issues and is trained well enough to be another set of eyes on your behalf for a holistic check-up of your wide array planning needs.

#7: Can you provide any professional recommendations?
This can be tricky for lawyers, especially those who practice in sensitive fields where people value their privacy like Asset Protection, as opposed to say, a real estate lawyer. Nevertheless, they should be able to provide at least a couple of professional references that speak specifically to their experience in this field, or from related professionals outside their own firm that refer clients to them for this specific service.

#8: Have you written anything on this topic that outlines your tools and strategies?
If your planner is even marginally qualified to work in this area with you they should have extensive educational materials that describe the tools, they use and what each tool does. If they can’t educate you about the tools they will likely do more harm than good, as part of our job as planners in this area is to educate our clients on what works best, why, and how to use it going forward. No matter how much support a firm offers, they can’t be with you 24/7 so they better be able to train you.

#9: Can you provide a specific written plan that outlines costs, results and requirements?
Every firm prices its services differently, and that’s OK, but they should be able to show you in writing what result they are going to attempt to achieve for a specific place. (I say attempt because there is no such thing as certainty in the law, all we can do is follow proven best practices supported by law and experience with others. Anyone who tells you their system is undefeatable and “will” never be broken is lying, or worse, stupid).

#10: What kind of on-going support and education do you provide to your clients and at what cost?
Hiring an Asset Protection lawyer is one step in a holistic, multi-step process with many pieces, not a one-shot magic bullet. If you pay someone in my business to build you a “Legal Vault” that is capable of containing your life’s work, they better be there to help you put the assets in it, use it the right way, teach you to lock the door, and show you how to open it when you need your assets or use of them. Merely getting a box of legal papers on its own is not going to serve you and your family well. Be wary of the fees involved to use the plan, in addition to what it costs to set up. Ask specific questions about accounting, compliance and tax status, and reporting burdens, many of the best Asset Protection tools and plans are explicitly tax neutral. Finally, be clear about how accessible your planner is going to be going forward and at what cost. Many hide huge fees on the back end to lure you in up front. This list will doubtless be fluid, and expanded as other issues prove outside the experience of clients and advisers. For now, consider it a starting point on your journey to financial security and to having your own “net worth insurance” policy in place.

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  When an inheritance is a burden
Posted by: it-man - 07-30-2015, 02:57 AM - Forum: Things the Wealthy Do - No Replies

For everyone who dreams that an inherited windfall would make their lives easier, there are plenty of inheritors who say otherwise. Chuck Collins, great-grandson of packaged-meat magnate Oscar Mayer, is one of them.

Collins says that when he found out he would inherit a small fortune at the age of 21, his sense of self-worth was knocked a little off-kilter because he always expected to earn his own way. "I remember feeling a little bit of dread," he adds.

When young inheritors discover they may never have to work for a living, it alters their values as well as their position within their social network of peers, who are busy building careers. "Kids tend not to do well when they come into an inheritance at 21," says Madeline Levine, psychologist in Marin County Calif., and author of "The Price of Privilege" and "Teach Your Children Well."

Levine says that for many young adults, an inheritance is a burden.

Giving it all away

Collins says he felt the money would separate him from his goals and his friends. So by the time he had full custody of the inheritance, in his mid-20s, he made a somewhat drastic decision to give all the money to charity. He donated it to a variety of community foundations. "I didn't do this immediately," he says. "I had about five years to think about it."

Nearly 30 years later, Collins doesn't regret his decision. "I felt like I was doing it from a healthy place," he says. "I didn't want to be seen as a bag of money just because I was born into certain circumstances." Today, Collins earns his living as an author and expert on economic inequality and taxation. In 2008, he co-founded Wealth for the Common Good, a network of business leaders and wealthy individuals promoting fair and adequate taxation.

"My advice to inheritors is to pause, take a breath and think about what kind of values you want to live by," Collins says. "All around you, people will want you to hold onto the money; there's an entire industry devoted to wealth preservation." He encourages inheritors to figure out how much they need in order to invest in skills to earn a living and then consider giving the rest away.

Fear of being without will be a challenge that will lead many young people to hold onto the money as a safeguard, but Collins advises giving in to the impulse to be generous. "Trust yourself to share," he says.

He also suggests gaining perspective by examining the relationship between consumerism and happiness. "Look at role models of happy people and look at how much materialism is necessary," he says. More money doesn't increase happiness, he adds.

(This article was copied from here - http://www.bankrate.com/financing/wealth...-a-burden/)

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  6 Costly Estate-Planning Minefields, And How To Avoid Them
Posted by: it-man - 07-30-2015, 02:13 AM - Forum: Things the Wealthy Do - No Replies

Over the years many celebrities have provided cautionary estate-planning lessons, and actor James Gandolfini, who died in June 2013 at age 51, is no exception. The actor, known for portraying mob boss Tony Soprano, left a portion of his estate, widely estimated at $70 million, to relatives and friends through his will, which became public and was criticized as being badly constructed. For one thing, it exposed some of his wealth to probate, the time-consuming and potentially costly process a legal court takes to administer financial affairs. In addition, his estate could owe millions of dollars in federal estate tax alone.

At least Gandolfini had an estate plan; fewer and fewer Americans do. In 1998, 61 percent of Americans 55 and older had a will or trust. In 2012, only about 54 percent did, says a study by Texas Tech University.

Failing to take action or making the wrong moves can be costly for you and your heirs. Here are six blunders experts told us they see most often, and what to do instead:

Minefield No. 1: You think you’re too young for a will or don’t have enough assets to protect

A good estate plan can save your heirs some money; it also protects you and your family while you are alive. If you don’t have a plan and you become incapacitated, someone will have to go to court to be named your guardian so that he can make medical and financial decisions for you. The process not only is unpleasant but also could easily cost $10,000 or more, says Martin Shenkman, a New York City attorney and certified public accountant. If other family members object, the process could drag out, which will cost more and could leave your bills unpaid or delay needed medical treatments.

If you die without a plan, you’ll also have no control over who becomes the guardian of your minor children or who gets your assets. “A lot of people assume that if they do nothing, everything goes to a surviving spouse,” says Deborah Cohn, an estate-planning attorney in Bethesda, Md. Instead, your property will pass to your survivors based on your state’s laws of intestacy. (You can find links to your state’s rules - http://www.nolo.com/legal-encyclopedia/i...succession.)

And if you have neglected to name beneficiaries on accounts that need them, such as retirement, life insurance, and brokerage accounts, the companies that manage those products have a default rule in their contracts’ fine print that spells out how your assets will be distributed. “It might say it goes to your surviving spouse, but it might also say it goes into your probate estate,” Cohn says. “Then your state’s intestacy law make those decisions for you, and money will be depleted to pay for probate.”

Steer clear. Get a basic estate plan in place. You’ll need a will, which states who you want to inherit any property that does not have a designated beneficiary, and name a guardian to care for young children. You’ll also want to draw up a financial power of attorney, which will allow someone you name to make financial decisions for you when you no longer can. Health care directives, which include a health care declaration (living will) and a power of attorney for health care, let someone make medical decisions for you. (In some states, those documents are combined into one, called an advance health care directive.) You may also want to consider a trust, which will hold some or all of your assets and pass them directly to your heirs at your death, avoiding probate.

Drafting a plan doesn’t have to cost tens of thousands of dollars. You can do it yourself with document-writing software that costs less than $100. “DIY plans are better than nothing, but they won’t address your individual needs,” says Russell James, an estate-planning attorney and a professor in the department of personal financial planning at Texas Tech University. A basic plan drawn up by a pro can cost as little as $1,500 to $2,500, says Steve Hartnett, an estate-­planning attorney and the director of education for the American Academy of Estate Planning Attorneys. But if your situation is more complicated (for example, you own a family business and will need to set a up a plan for a child with special needs), the cost could be several thousand dollars.

Search for an attorney who specializes in estate planning by getting a referral from your accountant or financial planner, or check the websites of the American College of Trust and Estate Counsel (http://www.actec.org/) and the National Academy of Elder Law Attorneys (https://www.naela.org/). Then call a few and ask how much they’ll charge, if anything, to meet with you for an hour and discuss your estate-planning needs. After your consultation, concentrate on negotiating the lowest price you can with the lawyers you like the best.

Minefield No. 2: You put everything in joint ownership

After a divorce or the death of one parent, the surviving parent often add a child’s name (or that of another relative or friend) to bank, brokerage, property, and other assets as a way to ensure that they can take control if you need them to, and allow them to inherit the assets when you die and avoid probate, James says. “What parents often fail to grasp is that the child is a full co-owner of the asset immediately,” he says. You may not be worried about your child or another person you trust misusing the funds, but your worldly goods could be at risk if he is involved in a lawsuit, bankruptcy, or divorce proceeding.

Steer clear. You can designate who will inherit your bank accounts, vehicles, and real estate automatically when you die. For example, you can set up payable-on-death bank accounts. All you need to do is fill out a simple form, provided by the bank, naming the person you want to inherit the account. While you live, the person you named has no rights to the money. You can spend it, name a different beneficiary, or close the account. At your death, the beneficiary receives the funds directly, avoiding probate.

Almost every state has adopted a law (the Uniform Transfer-on-Death Securities Registration Act) that lets you name someone to inherit your stocks, bonds, and brokerage accounts without probate. It works very much like a payable-on-death bank account. You tell your stockbroker or the company itself that you’d like to take ownership in what’s called “beneficiary form.” Those you name have no rights to the asset as long as you are alive.

Several states also allow transfer-on-death deeds for vehicles. You can find a list of the states that allow those types of accounts on Nolo's website (http://www.nolo.com/legal-encyclopedia/a...29544.html).

Minefield No. 3: You forget what a will doesn’t do

One of the biggest misconceptions is that a will has the final word, James says. But if you have a 401(k), an IRA, insurance policies, and other assets with named beneficiaries, as well as the payable-on-death and transfer-on-death account mentioned above, that money will be distributed directly to the people named, even if your will states otherwise. So if your will says that you want your son to receive your life-insurance proceeds, but your ex-wife is still the beneficiary on record at the insurance company because you forgot to update your information, she gets the money.

Steer clear.  Make a list of your assets with named beneficiaries, and review them at least every five years. Make sure that all documents still reflect your desires and that your beneficiaries and financial and health care proxies are still willing and able to serve. In addition, revisit your estate plan if Congress revises estate-tax laws or whenever there is a major change in your life, such as a birth, death, marriage, or divorce.

Minefield No. 4: You allow your legacy to be squandered

You may wish to leave property to a beneficiary but worry that he won’t spend it wisely or that she might get into trouble with creditors. Even if you respect your heir’s ability to handle money, he still might be tempted to spend it quickly. In a 2012 study, Jay Zagorsky, a researcher at Ohio State University’s Center for Human Resource Research, found that the average baby boomer surveyed had spent, donated, or lost roughly half of his or her inheritance in the first 12 months.

Steer clear. If you are concerned, put the assets you want to pass on in a trust and include instructions on how and when it will be paid out. A spendthrift trust allows payments to the beneficiary on a regular basis (say, monthly), so it can’t be spent all at once. Because the beneficiary cannot access the trust principal, neither can his creditors.

You could also set up a trust that pays funds out over time—say, when a child reaches ages 25, 30, and 40. Or you can say what the funds can be used for, such as educational expenses, a new home, or retirement savings.

Minefield No. 5: You ignite sibling rivalry

“When parents die, fights between siblings are often over things, not money,” Cohn says. Jewelry, furniture, artwork—the legal term is “nontitled property”—and who gets what is often the biggest source of unhappiness among surviving family members.

Steer clear. Talk to your children to find out what they want and expect. “Parents have to be skillful in setting the tone,” Cohn says. “If you are asking for honest answers, you have to be willing to hear them.”

Of course, you’ll have to make the ultimate decisions. So if you want your jewelry or paintings to go to a particular child, put it in writing. Many states let you attach a codicil to your will indicating that you’ve made a separate list distributing your possessions. You can update the codicil without having to update your will when you do.

Minefield No. 6: You overcomplicate your plan

The federal estate- and gift-tax exemption is $5.43 million in 2015, up from $600,000 in 1997; it continues to increase with inflation each year. Spouses may combine exemptions, so they can leave or give away $10.86 million this year without their heirs owing federal estate tax (which can be as high as 40 percent). The Tax Policy Center estimates that just 0.14 percent of estates in 2014 owed federal estate tax, down from 2.3 percent in 1999 and 7.65 percent in 1976.

When the limits were lower, many married couples funded complex plans that often included a bypass trust to take full advantage of the estate exemption. The trust would include as much of the deceased spouse’s property that he could pass free of estate tax using his exclusion. The surviving spouse would often have access to the income from and the principal of the bypass trust during her life, but the bypass trust would not be part of the surviving spouse’s estate at death and would pass estate-tax-free to the beneficiaries.

In 2011 the law changed to make the deceased spouse’s exemption portable, offering couples the option to jettison the trust to avoid its drawbacks. For example, assets in a bypass trust won’t get a step-up in basis at the death of the second spouse, so the heirs could face big capital gains bills on appreciated assets. Depending on where you and your intended beneficiaries live, the income-tax savings from the step-up in basis may be greater than the estate-tax cost.

In addition, unless trust income is distributed, the income-tax penalty can be huge. That’s because a trust hits the highest income-tax bracket once it has more than $12,150 of taxable income. By contrast, a single individual doesn’t hit that bracket until his taxable income is more than $406,750.

Steer clear. You’re not likely to need a bypass trust to use both spouses’ exclusions. But if you already have one set up, talk to your attorney about what to do. Depending on your situation, you may still find a bypass trust worthwhile if you want to protect assets from creditors or ensure (in the case of a surviving spouse’s second marriage) that the money eventually goes to your own children.

(This article was copied from here - http://finance.yahoo.com/news/6-costly-e...500869.html)

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  Six Things Bad Financial Advisors Do
Posted by: it-man - 07-30-2015, 01:36 AM - Forum: 5D Investing for Profit - No Replies

By Roger Wohlner

A good financial adviser can add tons of value to your financial well-being and can enhance your quality of life. “Good” can be a subjective term, in this case good denotes someone who is qualified to help you and whose personality gives you the confidence to follow their advice.

In evaluating the latter, here is a list of six things financial advisers do that might mean that they're not the right advisor for you.

They Ignore Your Spouse
While this can occur with both male and female advisers and the ignored spouse can be either the husband or the wife, most accounts of this type of behavior tend to be with male advisers all but ignoring the wife. There have been several accounts in the press lately of widows leaving the adviser who served them while married for just this reason.

If you are working with an advisor who ignores you, insist to your spouse that you switch advisers, any adviser worth their salt should be upfront that he or she serves the interests of both spouses equally.
(For more, see: How Financial Advisors Mistreat Women (And What Women Can do About It and What Women Want from a Financial Advisor.)

They Talk Down to You
Not all clients are financially sophisticated, or for that matter, even take an interest in their financial affairs. Still, it's the duty of the adviser to explain to you why he suggests a certain course of action or a particular financial product in a fashion that makes sense to you.

If this isn’t the case be assertive or switch advisers and never let anyone you are paying talk down to you or make you feel stupid.

(For more, see: Why Clients Fire Financial Advisors .)

They Put Their Interests Before Yours
This is perhaps most common in dealing with financial advisers who are compensated all or in part via commissions from the sale of financial products. Are they recommending mutual funds, annuities, or insurance products that pad their bottom line but might not be the best product for you?

You need to ask questions and understand how your adviser is compensated and if this results in conflicts of interest for them in advising you.

(For more, see: What You Need to Know About the Fiduciary Standard .)

They Won’t Return Your Calls or Emails
A good financial adviser is probably busy, but if you are not important enough to them to rate a response in a reasonable amount of time this isn’t right.

While most advisers can tell a story about a client who calls every day my experience is that most clients make reasonable requests and deserve a prompt reply to their questions. If someone who you are paying to provide you with financial advice won’t reply to your calls why keep paying them?

(For more, see: Tips for Resolving Disputes With Your Financial Advisor.)

They Suggest That You Don’t Need a Third-party Custodian
Can you say Madoff? If you ever find yourself in a meeting with a financial adviser who suggests that you shouldn’t have your account with a third-party custodian such as Fidelity Investments, Charles Schwab Corp. (SCHW), a bank, a brokerage firm, or some similar entity your best move is to end the meeting, get up, and run (don’t walk) away.

Madoff had his own custodian and this was a centerpiece of his fraud against his clients.

A third-party custodian will send statements to you independent of the adviser and usually offer online access to your account as well. Ponzi schemes and similar frauds thrive on situations where the client lacks ready access to their account information.

(For more, see: How do I Know I Can Trust My Financial Advisor? )

They Don’t Speak Their Mind
An important aspect of a healthy client-financial adviser relationship is honest and open communication. This goes both ways. Clients might express a desire to make a particular financial move or to invest in a particular stock or mutual fund to the adviser. 

A good adviser will tell the client if he disagrees with this suggestion if that is the case and the reasons why they disagree. To not do this is doing the client a huge disservice.

At the end of the day it’s the client’s money and they can do with it what they wish. But a good financial adviser will never tell a client what they want to hear just to keep earning fees or commissions from them.

(For more, see: Shopping for a Financial Advisor and Why the Best Financial Advisor Might be You.)

The Bottom Line
The six characteristics outlined above are of course not exhibited by all financial advisers but rather are in my opinion the six worst characteristics that an adviser can have in dealing with a client. If your adviser exhibits any of these traits on a consistent basis this might be a sign that it's time to find a new financial adviser.

(For more, see: 7 Steps to Evaluate a Financial Advisor .)

(article copies from http://www.investopedia.com/articles/inv...z3XCkxy5vP)

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  CDARS insure deposits more than $250,000
Posted by: it-man - 07-30-2015, 01:18 AM - Forum: Banking - No Replies

Most bank deposits are only insured by the FDIC for up to $250,000 (as of the date this post was published). CDARS (Certificate of Deposit Account Registry Service) is a way to insure your funds, $50 Million or more held in a bank, are insured. To gain the added insurance, the bank that sets up the account, splits the deposit among as many as necessary to get all of the funds insured. Go to this web site to learn all about CDARS - http://www.cdars.com/. The site will tell you all about CDARS, and the banks that offer this product. 

There is some discussion in some circles that the FDIC is effectively broke. So we would suggest that you not rely upon CDARS as you only means of protecting your assets.

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  How to research stability of banks
Posted by: it-man - 07-30-2015, 12:38 AM - Forum: Banking - No Replies

Not all banks are stable. We would suggest that you only use banks that are stable, meaning those that are highly rated by some independent evaluations which use the quarterly filings banks make with Securities and Exchange Commission (SEC).

Here are two websites you can use to do your own research:

You can use this website to find banks, find out their asset size and the size of their derivatives: Forum Moderators

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  About the Forum Team (Moderators)
Posted by: it-man - 07-29-2015, 11:42 PM - Forum: Moderators explain purpose of site and outvesting - No Replies

This forum has been created by a group of people from the Many of One (MOO) family. To learn more about MOO and our world view, click on this here.  

We decided to form this team because we shared an interest in the general topic of what impact will the shift to 5D have on the financial world and how people might want to help others using the financial resources at their disposal. To learn more about what we mean by 5D, click here.

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  What is 5D?
Posted by: it-man - 07-29-2015, 11:38 PM - Forum: Moderators explain purpose of site and outvesting - No Replies

The moderators of this forum believe that the Earth has been in what we call a 3D state for perhaps the last 13 thousand years. 3D refers to a frequency or vibration on Earth that we have experiences for our lifetime. We believe the frequency/vibration of Earth is transitioning to a higher frequency. Some, but not all people, believe that Heaven or Nervana exists at a 4D frequency. And 5D represents a frequency state that is one step higher than 4D. Many have called what Earth will be like in a 5D state "heaven on earth" or "Earth's golden age". In the 5D state, there will eventually be no crime and no lack of basic needs such as food, water, shelter, education, power, transportation. The amount of strife and discord that currently exists on Earth will become a thing of the past. 

When the transition to 5D is complete, we believe there will be no need for money as we now know it. We believe that people will be able to manifest or create the things they need out of thin air and/or there will be advanced technologies that will create everything we need at no cost (think of the replicators from the Star Trek TV series).

To learn more about events that we believe will precipitate these changes, you might want to:

  • Watch the 3 part video called "Change is on the Horizon" by clicking here
  • Read the history of NESARA by clicking here

The purpose of this forum is to have a place for all of us to share ideas and experiences that relate to our financial world as we make the shift from 3D to 5D. 

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