One of the main ways that wealthy families accumulate and keep wealth is through real estate.  Despite the year-to-year ups and downs of the real estate market, the value of real property continues to grow over the long term.

Real estate is often considered a comparatively easy way to maintain and grow wealth because it doesn’t require the kind of daily attention—or stress!—that a business demands.  Depending on the type of property, real estate typically requires duties that are annual or month-to-month, such as maintaining the physical structures, paying property taxes, making insurance payments, getting updates from property managers, and the like.

What real estate investors might be slow to realize is that property ownership carries with it significant liability risks.  Unless the precautionary measures are taken, one small misstep can result in the loss of all your real estate holdings.  Imagine it, one person slips and falls in front of one of your properties, and suddenly ALL of your holdings are at risk.

Preventing this kind of mess is not as difficult as you might think—for example, putting each of your properties in its own separate legal entity is one technique that can be used to protect all of your properties (and yourself) from lawsuits. Our firm can help you with this and other asset protection techniques.

We know how important it is to keep your family and your finances safe, and we are dedicated to helping you achieve that security.  Call our office and let us tell you how we can put our expertise to use for your benefit.

Real estate plays an extremely large role in the estate planning process.  As mentioned in previous posts, your home (or other real estate holdings) often forms the bulk of your assets, and figures largely in the creation of your family’s estate plan.  But real estate can serve as far more than just the cornerstone of your estate plan, especially if you have property aside from your family home.

In the current downswing of the real estate market, many people are finding that holding on to unproductive property is becoming a financial hardship.  And yet they are reluctant to sell the property at a loss.  Enid Ablowitz, in her article Giving the Gift of Real Estate, has some excellent suggestions on how to get the most out of property that no longer serves your family or your business, including giving the property as a charitable donation, transferring the property into a charitable “lead” trust, and keeping the property in a retained life estate.

Ablowitz suggests in her article that unproductive property can be turned into an asset when used as a charitable gift.  In fact, Ablowitz writes, “When there is charitable intent, there are many scenarios where a gift of property can also be tax-wise.”

If you think you might like to look further into leveraging your property—for charitable purposes or otherwise—your estate planning attorney can help.  Our office can answer your questions about the tax advantages of making a charitable donation of property, or alternatively of keeping the property, but holding it in a separate protective entity such as an LLP or FLP.

When considering your estate, your property is likely your greatest asset.  Let our firm help you decide how to make the most of your property, whether you choose to leverage it now or keep it safe for the future.

Do dating and estate planning go hand in hand?  They do if you are one of the lucky people finding romance late in life.

With people living longer than ever before—and staying healthy and active longer as well—there are more cases of people finding love a second (or third or fourth) time around.  This is cause for celebration for widows and widowers, but it has many of their children and grandchildren worried.  When mom remarries at the age of 80, what happens to the estate that she and dad built during their lives together?

Without a prenuptial agreement or estate plan, all of mom’s assets could end up going to her new husband, which he could then choose to leave to his children.  With so much at stake it’s no wonder that the children of elderly brides and grooms are responding with less than unadulterated joy.

Luckily, this is one problem with an easy solution: Involve your estate planning attorney before the marriage takes place.  Executing a pre-nuptial agreement can go a long way towards protecting your assets and your children’s inheritance.  Another option is to create a trust which leaves all of your assets to your children or grandchildren upon your death.

Talking about prenuptial agreements with your new fiancé can be an awkward conversation, especial for the older, more traditional generation.  Creating a trust early can alleviate much of that awkwardness.

Romance is still alive, even at 80 or 90 years old.  Unfortunately, so are the financial risks that come with any second marriage.  Call our office today.  Let us take care of the risks, and leave the romance to you.

On a scale of one to ten, how high would you rate your retirement angst? If you are a woman, you’re likely to rate your worry higher than men rate theirs, according to this new study by MIT AgeLab. This begs the question; are women just more inclined to worry, or are their fears justified?

The answer to that question would seem to be the latter.  According to Dr. Joseph Coughlin, a woman is “likely to outlive her male counterpart, remain active longer, and be responsible for caring for him and others.” What Dr. Coughlin seems to be saying is that women aren’t just worried about retirement, what they fear is actually a myriad of issues having to do with finances, health, caretaking, and social concerns, none of which can be separated from the others.

What this means is that there won’t be one simple solution for women to their retirement fears. Any “solution” will have to consist not only of a simple financial solution, but also of a plan to address issues such as:

• How to make up for a retirement income that is, on average, 58% of men’s.
• How to adjust if you end up caring for a family member in declining health.
• How to weather future inflation and changes in health care coverage.
• And what to do if your spouse passes away.

Women know that fear can be productive and motivate us to find solutions. Hopefully by naming this fear women will be inspired to take action to protect their futures.  Men can take action to help protect their wives and mothers as well.  It’s no exaggeration that women will live longer than men, and are likely to take on the burden of caring for aging family members.  Planning for these eventualities when you’re young, and planning with your spouse and family can ease the burden later on.

If women out-worry men on the subject of retirement, let their planning reflect that.  Nothing eases anxiety like preparation.  Don’t let your fears paralyze you, let them motivate you instead.

When it comes to retirement plans there is no one-size-fits-all situation.  And not all plans are created equal.  A traditional family will need a different plan than a blended family with stepchildren; a divorced man will need to plan differently than one who has never been married.  How can you know which plan is right for you?

The New York Business Wire has published an article with a series of tips to help you plan for your unique retirement situation.  The article caters specifically to non-traditional circumstances—such as blended families or single women—and the distinct challenges they face.

One of the article’s recommendations is to establish a trust to protect your estate from ex-spouses and keep it safe for your children.  As a firm that has helped a number of families set up trusts to keep their retirement intact for the benefit of their children, we know what a crucial step this can be.

If you’re wondering whether or not a trust is really going to have what you need to achieve your goals, you should know that there are as many types of trusts to protect your retirement as there are families who need protection.  Some families may want a full-blown Retirement Trust; others may be satisfied with the protections offered by the basic Revocable Living Trust.  Whatever your intention, a trust can help you attain it.

Whether your situation is traditional or not, each family’s needs are unique.  Talk to your attorney and financial advisor about your plans for retirement.  Make sure your future is protected—for yourself and for your loved ones.

There are some people who might question the patriotism of those who would try to arrange their affairs to pay a lower amount of taxes. But how much truth is there in that?

Is it unpatriotic to want to work within the limits of the law to reduce the amount of taxes you pay?

Everyone will have their own opinion about this, and we welcome you to join the conversation by leaving a comment.  To begin the discussion we give you the opinions of two distinguished American jurists:

“Anyone may arrange his affairs so that his taxes shall be as low as possible; he is not bound to choose that pattern which best pays the treasury. There is not even a patriotic duty to increase one’s taxes. Over and over again the Courts have said that there is nothing sinister in so arranging affairs as to keep taxes as low as possible. Everyone does it, rich and poor alike and all do right, for nobody owes any public duty to pay more than the law demands: Taxes are enforced exactions, not voluntary contributions. To demand more in the name of morals is mere cant. “

— Honorable Learned Hand, U.S. Appeals Court Judge, Helvering v. Gregory, 69 F.2d 809 (1934).

“I live in Alexandria, Virginia. Near the Supreme Court chamber is a toll bridge across the Potomac. When in a rush I pay the dollar toll and get home early. However, I usually drive a free bridge outside the down- town section of the city, and cross the Potomac on a free bridge. The bridge was placed outside the downtown Washington D.C. area to serve a useful social service: getting drivers to drive the extra mile to help alleviate congestion during rush hour. If I went over the toll bridge and through the barrier without paying the toll, I would be committing tax evasion. If, however, I drive the extra mile and drive outside the city of Washington, I am using a legitimate, logical and suitable method of tax avoidance, and I am performing a useful social service by doing so. For my tax evasion, I should be punished. For my tax avoidance, I should be commended. The tragedy of life today is that so few people know that the free bridge even exists.”

— U.S. Supreme Court Justice Louis D. Brandeis

Celebrity divorces can hardly be considered news anymore, they happen so often, but the recently finalized divorce between Bill Murray and ex-wife Jennifer Butler Murray is news because of something they did before the wedding:  They signed a prenuptial agreement.

And it worked.  At least it seems to have worked so far according to the Associated Press.

Preventing painful, drawn out court battles and protecting your individual property is exactly what a prenuptial agreement is designed to do.  And prenups are not just for celebrities or millionaires anymore.  If you have property, or a business, or even a burgeoning career, a prenuptial agreement is worth looking into.

Are you planning to pass an inheritance on to your children? Ron Lieber, author of this article in the New York Times, writes that leaving a financial legacy may be more difficult than you think. “With each passing year” Lieber writes, “the pressures on the nest eggs of older people will only grow.”

Lieber outlines in his article 8 possible reasons you may not end up leaving the inheritance your children will expect, but the last one is the most interesting; “the transfer of wealth will increasingly happen while the older generations are still alive.” This is because more and more people are realizing the benefits of giving tax free gifts during their lifetimes, instead of waiting to leave an inheritance.

Giving a gift during your lifetime that is within the annual exclusion amount (currently $12,000 per gift) means that you can not only have the satisfaction of seeing the recipient enjoy the gift during your lifetime, you also have the added benefit of reducing your taxable estate.

And just because you decide to give your financial gifts before your death doesn’t mean you have to give up the protection of giving your gift in trust. A trust can be created and used during your lifetime; a fact which can be especially helpful if one of your beneficiaries has special needs.

Most estate planning attorneys will tell you that if you want to spend your last dime on the day you die—so much the better! But it shouldn’t stop you from thinking about the future right now. Whether you plan to leave gifts to your children and grandchildren before or after your death, let someone in the know help you find the most efficient way to leave the legacy you want.

If you’re wondering exactly how much you’ll have to put in the bank to live comfortably when you retire, you’re not alone.  But it just got a little bit easier.  You now have the recently updated retirement calculator and guide, “Taking the Mystery Out of Retirement Planning”, provided by Uncle Sam himself, to help you figure it all out.  And according to The Wall Street Journal, it’s “one of the best resources available.”

We would all like to have the security of knowing that we have enough to live on when we retire.  Unfortunately, we have no crystal ball that can tell us with absolute certainty how much will be “enough”.  Even the above-mentioned guide from the Employee Benefits Security Administration—although updated, improved, and easy to understand—can only give you a best guess.

The best way to ensure you have enough on which to retire is simply to stay informed and be prepared.  And this is where your advisors can help.

Your financial planner and estate planning attorney work hand in hand to make sure you can retire in comfort.  Your financial planner can help you navigate the murky waters of investing, answering questions such as “How much should I be investing?  Where?  For how long?”  Your estate planning attorney can give you the tools to protect those investments for yourself, your spouse, and your children or grandchildren.

Don’t let fear or lack of education paralyze you.  Get the help and advice you need to take your future into your own hands.

There are times when everybody needs a little motivation to plan for the future, but when you live in a situation that is outside the norm it’s even more important to think ahead.  A little motivation to plan for retirement is exactly what many same-sex couples need, according to this study published in Cornell News, at Cornell University.

When Cornell researchers Steven Mock, Catherine Taylor, and Ritch Savin-Williams analyzed data from interviews with men and women in same-sex relationships they found that gay and lesbian couples have a slightly greater tendency than straight couples to put off planning for retirement, and that the amount of retirement planning a couple will do is directly proportional to how happy they are in their relationship.

It’s not surprising that the more satisfied a couple is the more willing they are to look to the future, but the fact is that same-sex couples will have challenges enough in their futures, and can’t afford not to plan.  The authors of the Cornell study note that “Nearly all state and federal legislation assumes gay and lesbian life partners to be individuals and not economically interdependent as married couples are assumed to be. This lack of recognition of same-sex couples has repercussions in terms of retirement and financial planning.”

This means that same-sex couples not only have to be diligent about their individual financial and retirement planning, but also about planning together.  Because same-sex couples will not have the same tax status, or options for transfer of property upon death as traditionally married couples, it is essential that they make provisions for their partner with their estate and retirement plans.

“It would be a tragedy of immense proportions if same-sex couples who have been together for decades discover at the end of their life that they have few resources to enjoy their retirement and their last years of life,” notes Ritch Savin-Williams in the article mentioned above.  But it is a tragedy that can be easily averted.  With a little research, and with help from a savvy attorney and financial planner, same-sex couples can enjoy their golden years in style; healthy, wealthy, wise—and together.