Trusts & Estate Planning - Coral Gables Trust Company - What You Need to Know!
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What You Need to Know!

A blog about keeping you up-to-date with the latest Financial Planning and Wealth Management news.

Steve McNair's Colossal Fumble

Planning for Success: Steve McNair’s Colossal Fumble Estate Planning is commonly believed to only benefit wealthy and older individuals, when in fact all stages of life can utilize certain aspects and strategies of estate planning.  One could infer that estate planning is of greater significance for younger adults than it is for older ones.  This is due to younger adults often having dependent children that will require care for the foreseeable future.  If you are a parent of a minor child, how would the unexpected disappearance of you or your spouse impact your family?  Are your assets appropriately titled to avoid freezing your estate and probate?  While estate planning is often thought to be a scary process, it is not something to fear.  By acting today, our team of seasoned professionals can develop an effective strategy to seamlessly transfer your property; thus, allowing you to continue to provide for the individuals...
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"Life is very tough. If you don't laugh, it's tough" - Joan Rivers

An individual’s residence and domicile are often narrowly perceived as the same; therefore, potentially missing out on tremendous tax benefits.  A significant aspect of the estate administration process is your domicile at the time of your demise, not where you were residing.  While you can have multiple residences in various states, you can only have one domicile.  Essentially, a domicile is a combination of two factors, the first is residency, and the second, an intent to remain for the foreseeable future.  Clients often look to establish residency in a jurisdiction with an attractive legislation for estate planning purposes.  Suffice it to say, Florida is considered a tax sanctuary fueled by its superior asset protection climate.  Currently, there are seventeen states that will impose either an estate or inheritance tax for estates that exceed a certain threshold.  Individuals located in these states with a considerable taxable estate could be required to pay...
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Is Your Estate Plan for the Average Joe?

Is Your Estate Plan for the Average Joe?   While no one likes to think of their own demise or what needs to be done to efficiently transfer assets and protect the interest of each beneficiary, it is imperative as a business owner .  Efficacious estate and succession planning will provide a lifeline for not only the survival of your business, but your employees and their families.  An effective estate plan clearly outlines how your assets are to be distributed when the time comes.  Ultimately, this will ensure your business can continue to run smoothly as the appropriate steps towards a successful succession have been thoroughly planned. With the Dolphin’s season opener right around the corner, the estate of Joe Robbie distinctly comes to mind.  In the mid-1960’s, Joe Robbie co-founded the Miami Dolphins, which at the time played in the old American Football League, shortly before the merger with the National...
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When There's No Will, There's No Way - Florence Griffith Joyner

Having a will or a trust is essential, but it is only effective if upon your demise, the documents can be located in a timely manner.  The family of Florence Griffith Joyner found themselves in this predicament.    Florence Griffith Joyner was a famous American track and field star, whom most notably, won three gold medals and a silver in the 1988 Olympic Games in Seoul, South Korea.   Florence broke records in both 100 and 200 meters, earning her the nickname Flo Jo, for being the fastest woman of all time.  She was only 38 years old when she passed away in her sleep from an epileptic seizure.  Florence had taken the basic steps to ensure that her wishes would be fulfilled by a will.  Unfortunately, her husband could not locate the will and was therefore unable to file it within the required 30 days of her death per California...
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You Have All The Influence You Choose To Have - Philip Seymour Hoffman

Most of us have envisioned what it would be like to be the beneficiary of a multimillion-dollar estate; however, it is rarely cherished by the beneficiary, the complexity of planning involved to not only protect their interest, but future generations as well.  Envision being the beneficiary of a $35 million estate, only for it to be reduced by roughly a third, this was exactly what occurred to Philip Seymour Hoffman’s estate.  Due to his decision to choose a simple estate planning technique, approximately $12 million will never make it into the hands of his family; instead, being consumed by unnecessary taxes and fees that could have easily been avoided. Philip Seymour Hoffman passed away leaving behind his beloved girlfriend and their three young children.  While he certainly had the means to hire a top estate planning attorney to develop a comprehensive estate plan; however, Philip took the advice from his accountant...
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The Layup of A Lifetime - Kobe Bryant

While it may seem like a distant memory, it has been a little over a year since the legendary Kobe Bryant and his 13-year-old daughter, Gianna, tragically passed away in a helicopter crash.  Kobe’s untimely death at the young age of 41, highlights just how critical it is for every individual to not only develop an estate plan ensuring their loved ones are properly protected, but to ensure the documents are swiftly updated to reflect recent life events.   Bryant’s earnings, between his salary and endorsements during his 20-year career with the L.A. Lakers, are estimated to be roughly $650 Million.  Kobe had a comprehensive estate plan in place.  His estate plan included a trust to not only protect his assets, but to reduce his potential estate tax liability and ensure his wealth is properly passed on to his family.  Kobe’s trust was created to allow his wife and daughters to...
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Delivering Happiness: One Will at a Time

When people pass away, it serves as a reminder of life's fragility.  You never know what the future holds and it only takes one event to change everything in a blink of an eye.    Tony Hsieh was a visionary who co-founded Zappos, a shoe company, which focused heavily on customer service and famously offered customers free shipping and a complete refund on all shoes within a full year after purchase, no questions asked.  At only 46 years old, Tony Hsieh passed away from smoke inhalation complications from a fire at his vacation home in Connecticut.  At the time of his death, Tony was worth an estimated $840 million, but despite his immense wealth he did not even have a simple will prepared.  Given Hsieh's altruistic nature, it is puzzling why basic estate planning documents had not been prepared.  Unfortunately, he is not the first among celebrities and high-profile individuals to...
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Important Financial and Estate Planning Considerations amid the Coronavirus Pandemic

There is still time to get critical financial documents in place   With the demands of work, family and daily responsibilities, many of us often prolong, or cast aside, organizing and documenting important legal and financial decisions. Then, when a game changing life event occurs, such as the current Coronavirus pandemic, we wish we had acted sooner.    While we are in unprecedented times, rest assured that there is still time to get critical financial documents in place; but you need to act quickly.    Here are some tips on what you can do now to get your financial and estate plan in order:   Review the current status of your financial and estate plan.  This is especially critical for older individuals and those who have impaired health.     Ensure that you have sufficient cash available to provide for your needs over the next six months.    Review your asset...
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The SECURE Act and How it Affects Your Retirement

The SECURE Act and How it Affects Your Retirement
While the holidays were unfolding, Congress was busy signing into law the SECURE Act (Setting Every Community Up for Retirement Enhancement) which has made several important changes concerning defined contribution and defined benefit plans, IRAs and 529 plans.  Most provisions in the law became effective on January 1st, 2020.  Below are some general topics and answers on the main highlights of the new law:   Inherited IRAs Any inherited IRAs that were received prior to 1/1/2020, no changes are required to the current distribution schedules in place.  Going forward, however, fewer beneficiaries will be able to extend distributions over their lifetime (a.k.a “the Stretch IRA”).  In most situations there will now be a requirement that all assets must be withdrawn from the inherited IRA within 10 years.  Some of the exceptions to this rule include surviving spouses, minor child, a disabled or chronically ill individual and beneficiaries who are no more...
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How to avoid a Category 5 financial crisis when a storm hits

As seen in The Miami Herald - How to avoid a Category 5 financial crisis when a storm hits    “While many of us know to stock up on the typical hurricane supplies, ensuring our finances are well-organized and protected is not always top of mind during this hectic time.”   Hurricane Dorian spared South Florida this time; however, the threat of a potential hit had many stocking up on supplies such as food, water, batteries, gas and other hurricane-preparation items. Unfortunately, our neighbors in the Bahamas were not so lucky; the overwhelming devastation to the Islands has left many of us rethinking our disaster preparedness plans.   Ensuring our finances are well-organized and protected is not always top of mind during this hectic time: Do you have an emergency fund? Do you have adequate insurance on your home and businesses? Are your documents protected? The following tips are critical to...
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Are You on the Fast Track to Early Retirement?

Are You on the Fast Track to Early Retirement?
Are You on the Fast Track to Early Retirement?  Have you dreamed about retiring in your 50s or before you receive your AARP card? Are you ready to call the shots and choose how you will spend your days? Take this opportunity to envision what “retirement” means to you, what kind of lifestyle you would like in retirement and at what age would you like to achieve this dream. Retiring ahead of your peers depends on your dedication, financial situation, lifestyle, and early implementation of our comprehensive road map. We can chart the path together and, with the stewardship of a seasoned fiduciary team, we can quickly steer clear of potential roadblocks to keep you on track to realizing your goals and dreams. According to recent U.S Census Bureau data, the average retirement age in the United States is about 63 years old. Early retirement in terms of Social Security and...
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Elders and Finances: How Can We Protect Them from Themselves?

Elders and Finances: How Can We Protect Them from Themselves?
People are living longer today, thanks to medical advances and more health-conscious lifestyles, but that has created a situation that previous generations didn’t often confront. Helping take care of your aging parents or other relatives, especially when it comes to managing and protecting their finances, has become a concern for this generation.   Cases of elder abuse are very common; however, many go unreported. Unfortunately, some elders suffer in silence because they are too ashamed to say anything.   Common forms of abuse:   (1) One of predators’ favorite targets is the elderly, and sophisticated scammers will call the victim and tell them that they owe a debt and will be legally prosecuted if they don’t pay. When the victim sends them funds, now the scammer may have access to their accounts. making it worse for the victim.   (2) Caregivers who are taking care of the victim may have easy...
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Special Needs Trusts preserve government benefits while providing for a loved one.

Special Needs Trusts preserve government benefits while providing for a loved one.
Careful estate planning is necessary when planning for children or relatives with disabilities. The term “special needs” it is commonly used where there is someone in the family who is unable to make necessary legal, financial and overall life decisions for him or herself. The biggest fear is often “Who will take care of my loved ones and how will they be provided for after I am gone?” A Special Needs or Supplemental Needs Trust is a trust that preserves your loved one’s ability to receive Supplemental Security Income (SSI) and Medicaid benefits and can help you establish your wishes for how your loved one is provided for after your death. Owning a house, a car, furnishings, and some other personal items does not affect eligibility for SSI or Medicaid. But other assets, including having too much cash in the bank, will in fact disqualify your loved one from benefits. Leaving...
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Adding a fur member to the family? Here are three commonly overlooked concerns.

Adding a fur member to the family?  Here are three commonly overlooked concerns.
First, can we financially afford adding a pet to our family?  The simplest way is to start with a budget.  It is always best to slightly overstate the potential costs that will be incurred.  As a CERTIFIED FINANCIAL PLANNER™ Professional, I enjoy comprehensive research and running various scenarios to determine the best solution.       Let me save you time on gathering details for your pet’s budget. Initial costs vary greatly depending on if you are adopting from the Humane Society or opting for a designer pet from a breeder.  When it comes to adopting from a shelter, adoption fees range from $100 to $300, depending on age and breed.  A perk of this cost is that it typically includes spaying/neutering, microchipping, and vaccination. When purchasing a pet from a breeder, expect to pay from $1,000 to more than $2,000, depending on the breed. Additional beginning expenses will include: an initial...
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What might surprise you about your will.

What might surprise you about your will.
Most people have a general understanding of what a will is: a way to designate who will get which of your assets when you die. Many think the will is the principal governing document in your estate plan, but that’s not entirely true. Many assets don’t fall under a will or probate, and without considering those things, even the best will can be almost meaningless. Most people have accumulated real estate, have life insurance, have mutual funds (as part of or separate from a 401k or IRA), bank accounts, real estate, and other assets. In most or all of these cases, when you purchase the asset or sign a life insurance contract, you’re asked to designate a beneficiary, and sometimes a contingent beneficiary. One of the biggest estate-planning mistakes people make is not reviewing these other financial instruments and aligning the beneficiaries they have designated with their total financial plan, or...
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2019 is the year to focus on your financial plan (and not the stock market)

2019 is the year to focus on your financial plan (and not the stock market)
This past December was one for the books — and not in a good way. On Christmas Eve, the S&P 500 index fell by 2.71 percent, making history as the biggest plunge to ever occur on the last trading day before Christmas. Did Santa Claus skip town? Now, talks of volatility in the stock market, federal interest rate hikes, U.S.-China trade negotiations and the U.S. government partial shutdown mark every headline. With all this noise, how is it possible to stay calm and carry on? If you are a long-term investor, the solution is exactly that: stay calm and stay the course. Market swings, or “corrections,” are normal and to be expected. If you don’t need to utilize the investment funds you have set aside for an immediate short-term goal, then experts agree that you should still invest in the stock market and avoid trying to “time” the market. Instead of...
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Building stronger client/advisor relationships on a personal level.

Building stronger client/advisor relationships on a personal level.
Within the financial services industry, opinion is mixed on whether wealth management professionals should give clients advice on personal matters, on issues that do not relate to the client’s economic picture. Some practitioners give this practice a wide berth, reasoning that giving personal counsel could lead to trouble or damage the advisor-client relationship, especially if the client disagrees with the advice or the recommendation works out badly. But here’s another way of looking at it: judiciously handled, extending guidance to a client on non-financial matters can strengthen the relationship and provide benefits for both client and financial professional. You have to proceed carefully, of course, and the recommendations you give must be at arm’s length, and solid advice. Some advisors just talk, talk, talk, and go through the numbers with the client. But if you instead listen, you can learn so much more. Listen with empathy and be an active listener....
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Want to leave money to a charitable organization? Here’s how to do it wisely.

Want to leave money to a charitable organization? Here’s how to do it wisely.
When planning their estates, many people want to remember a charity, cause, or organization with a monetary gift, an honorable impulse. But the vehicle you use to make the charitable bequest can have a great impact not only on your heirs, but also the organization you’re trying to support.   It’s a very common mistake to include all of your assets in a will or revocable trust, which can have unintended tax consequences. Fortunately, there are easy remedies.   Keep in mind that what your heirs will actually inherit after your demise are the assets you earmarked for them — after taxes. So, when deciding how to structure your will or revocable trust, you want to always assess the tax consequences to your heirs of any and all classes of assets.   In the mix of investments most retired people have, there is almost always an IRA or 401K, for which...
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Leave your mark, in goals-oriented investing or traditional estate planning.

Leave your mark, in goals-oriented investing or traditional estate planning.
Recent changes to the tax code have raised the threshold for inheritance and gift tax to $11.2 million per person — a threshold most working people will not reach or exceed — and that’s caused some to speculate that estate planning is dead. But to paraphrase Mark Twain, rumors of its demise have been greatly exaggerated.   Instead, we’ve seen the emergence of legacy planning, which differs from traditional estate planning in several ways.   While estate planning in the past has been all about passing on as much of your assets as possible to your heirs and avoiding taxes, legacy planning talks about more than where the money goes, but also what you want to accomplish during your life and what you want to accomplish when you’re gone.   Your goal might be to preserve family wealth or to establish a blueprint so that a family business can continue to...
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