Have a plan & proven income strategy that will bullet proof your retirement savings

How To Turn a $1 Into $2, and Take Care of Your Heirs

I think we can all agree that many things are tougher for the younger generation. There is no guarantee they will get a job, even after graduating from a good college. For those just starting out, home ownership will be even harder.

These are just a few concerns voiced to me from a client during a recent annual review. Her three grandchildren are the joy of her life. The visit her often, and never forget her birthday. Two of the three are saddled with student loans, and still struggling to land that “perfect job” after graduating from excellent colleges. Our client wanted to help them in any way she could. Before her husband died a few years back, he put in place wills and trusts, along with enough money to take care of her for life. She wanted to use some of that money to help her grandchildren.

We tossed around the idea of gifting her Required Minimum Distribution (RMD).  Last year she took her $30,000 RMD, paid the taxes on it, and put the balance into her checking account. She did not need this money. So, we suggested she set up a Wealth Replacement Trust, and gift the net RMD into the trust every year. She liked this idea.

Her trustee applied for life insurance on her, and the end result was that we were able to secure a $600,000 life insurance policy on my client. This policy is owned by the Wealth Replacement Trust, so it is out of my client’s estate, and upon her passing, the $600,000 will be split up among her three grandchildren. Better still, it’s all income tax free! We did all of this without disrupting her everyday life, her budget, or her ability to enjoy her retirement. Her children will inherit her money and her house, and her grandchildren will get a helping hand from Nana via the trust we set up.

This is just one of the many asset protection and legacy planning strategies that are available. Come in and see us to find out how you can protect your assets, and help out your heirs. Make an appointment for your free consultation today!

In Uncategorized