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Thinking about a 401-k rollover? Here's some things to consider

Posted by Larry Jones on Nov 30, 2021 9:30:00 AM

Should you consider rolling over your 401-k to a personal IRA?

If you have recently left your job (or if it has left you), it's likely that you have an orphan retirement account at your old firm. Should you leave it there? If not, what should you do with it? What are the tax implications of your decision? What questions should you be asking that you don't know you should be asking?

Here are some guidelines to help:

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Topics: Retirement Plan Rollovers

Estate Planning: Does it Matter How Assets Are Titled?

Posted by Larry Jones on Nov 30, 2021 9:30:00 AM


Will the death of your partner rock your financial world?

Did you know that the number one reason for widows to be in poverty is because their spouse died? In other words, before that person passed away everything was rosy. Your financial plan absolutely needs to take the death of your partner into account (as well as their long-term care needs). Failure to do this is simply negligence.

One of the things I'd like to talk about this time has to do with the subject of titling your assets. This is something that sometimes doesn't get as much attention as it should, but doing it wrong can have very undesirable consequences.

For example, suppose that you and your partner own a brokerage account worth $1 million dollars. Your partner's share in this account is $500,000. The account is titled as TOC, which means Tenacies in Common.

Life is beautiful. Then, one day your partner is bitten by a rabid dog, and after biting many of her old acquaintances, dies shortly thereafter. When the will is read, your partner has specified that she'd like to leave her portion of the brokerage account to her son, Otis, who is an alcoholic living in Mayberry, NC with his alcoholic wife Agnes. You haven't seen either of them in twenty years.

Can she do that?


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Topics: Estate Planning

In Defense of Used Car Salesmen

Posted by Larry Jones on Nov 26, 2021 9:30:00 AM

Did you see the 1980 film "Used Cars?"

The film starred Kurt Russell as a sleazy used-car salesman. The film drew laughs because it so fit the sterotype that American's have regarding the person who may have sold them their last car.

It just so happens that on the "trustability" scale, car salesman don't seem to rank very high. I'm beginning to wonder if we're not being too hard on them.

The recent TV series about Bernie Madoff detailed how one of the greatest financial criminals in U.S. history systematically stole somewhere between $20-50 BILLION from investors through an elaborate Ponzi scheme, which went undetected by the SEC for decades. Let's see the car salesman top that! ( I won't even go into how a politician can be nearly broke when they enter politics, and be worth hundreds of millions years later, while earning nothing more than a public servant's salary...)

Most people have a very happy relationship with their stockbroker. Many times I have asked folks, "how's your portfolio doing?" only to have them tell me something like, "it's been doing good lately." When I ask them for specifics, many times they can't tell me what "good" actually means. Often, when I analyze their holdings they have in fact been doing good, for the last year or two, but they are very surprised to discover that they are no better off than they were ten years ago! Why did they stay in the holdings they were in? They trusted their stockbroker.

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Financial Services and the Busy Professional

Posted by Larry Jones on Nov 23, 2021 9:30:00 AM

We may be the most stressed out generation in history!

The statement above may be a little over the top. After all, probably nobody reading this has ever been kidnapped and sold into slavery, or watched half of the population of his city die of the plague.

But having said that, we are a generation on information steroids. Our grandparents embraced new "time-saving" appliances, such as washing machines and toasters, microwave ovens, etc. With all of the things we have to help us in our work we should be awash in leisure time. But is that the case with you? Certainly not with me.

Today, I'm not so sure we're not a slave to our devices. E-mails, tweets, and text-messages scream for our immediate attention. Our social life consists of wierd virtual friends whom we'll never meet in person, and really know nothing about. Responsibilities are endless, and especially if you're a working professional, the hours in the day don't seem to be enough.

Trying to keep all these ducks in a row can be too much. Many times the management of your finances is a chore that is always pushed out to the future.

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Topics: Subscription Services

How will your family handle a long term care situation?

Posted by Larry Jones on Nov 18, 2021 9:30:00 AM

Are you a reasonable person?

What a question, huh? Of course you are!

Why would I even ask such a question of a reader? "After all, isn't the fact that I faithfully read this blog, and am nearly physically ill when I miss one, proof enough that I'm a reasonable person?", you might say. Point taken.

Well then, this blog is for you! The subject is your family....or more specifically, your family and how your need for long term care might affect them, and their lifestyle. Is that important to you?

If so, read on.

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Topics: Long Term Care

An Estate Planning Case Study: Too Much Life Insurance

Posted by Larry Jones on Nov 16, 2021 9:30:00 AM

The Scenario:

Jack Howard, age 70, and his wife Marcy, 64, are very comfortable financially. Jack made a large amount of money from a series of successful patents obtained through the years. The value of Jack and Marcy's estate is calculated to be $11.9 million. Included in that amount will be a $1 million life insurance payout, from a policy on Jack, to Marcy. The life policy currently has a cash value of $700,000

Unfortunately, that million dollars will be included in Marcy's estate when she dies, and it will push her over the Estate and Gift Tax exemption, which is $5.45 million for the first to die, and then is rolled over to the surviving spouse, for a total exemption of $10,900,000. That will leave an estate tax bill of around $400,000. Now, that amount can easily be obtained from the life insurance payout. But is there a better way?

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Topics: Case Studies

Medicaid and Your Long-Term Care

Posted by Larry Jones on Nov 11, 2021 9:30:00 AM

The Final Option

In previous posts (Funding Long-Term Care ) we have been discussing the ways to pay for extensive palliative care...i.e. that is, when the patient is no longer improving, but is slowly declining, and is losing functionality, such as the ability to feed one's self, to use the toilet, bathing, etc. These things in themselves are not immediately life threatening, as long as assistance is provided by someone else. This level of care is quite expensive, but the bills must be paid in order for the care to continue. There are three ways to pay for this type of care:

1. Long-term care insurance

2. Self funding

3. Government assistance (Medicaid)

In the past two posts we've considered options 1 and 2. Both of these alternatives require some level of available funds, either in the ability to afford LTC insurance premiums, or to shoulder the costs yourself.

The third option is the last-resort scenario; the use of government assistance in the form of Medicaid.

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Topics: Long Term Care

Self-Funding Long-Term Care

Posted by Larry Jones on Nov 9, 2021 9:30:00 AM

An Offensive Proposition!

A number of years ago I was working with a gentleman in setting up a plan for his long-term care. The plan included a comprehensive LTC policy that would cover his expenses no matter where the care was received, either at home or in an institution. One of my suggestions is to always talk this over with your family before making such a purchase, if for no other reason than to let the kids know that you have the coverage.

Well, in this particular case, when the Dad told his son what he was doing, the young man threw a fit. The client contacted me and said that he needed to cancel the coverage. His words to me were, "my son was really upset that I had gotten that policy. He told me to get rid of it.....that HE would take care of me!" In they eyes of this fellow, the purchase of insurance implied that he wasn't willing to take care of his Dad. Of course that's ridiculous. LTC insurance isn't meant to replace the family as caregivers, it's to help them do a better job of caregiving, and for a longer period of time.

Being a full-time caregiver is very demanding, and you may not be healthy enough yourself to do it. When that happens, outside caregivers will have to be acquired, which can be very expensive. As I mentioned in a previous post ( see LTC Funding Options )  when it comes to paying for palliative care there are basically three options:

1. Long-term care insurance

2. Self funding

3. Government assistance (Medicaid)

In this post we'll look at number two: self funding.

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Topics: Long Term Care

Paying the bill for Long-Term Care

Posted by Larry Jones on Nov 4, 2021 9:30:00 AM

In the blink of an eye

David and his wife Shirley were enjoying their lives together. They'd been married for 53 years, had 3 children and 6 grandchildren, and were active in their church and community. Life was very good, and they had both been blessed beyond measure.

One evening as they were watching TV David noticed that his wife got up to go to the restroom. This wasn't unusual, but something was different this time. She returned, having not found the bathroom, and she seemed quite disoriented. David asked her what was wrong, and what happened next frightened him terribly. When she answered him it came out as gibberish. She couldn't speak! He also noticed that she had wet herself, and the frightened look on her face told him that she too, knew that something was wrong. As quickly as he could he dialed 911.

The prognosis wasn't good. Shirley had had a stroke, which left her unable to walk, there was no mobility of any kind on her left side, there were some cognitive issues, and she couldn't communicate. After several days in the hospital, and two weeks in a rehab unit, he took his beloved wife home.

But his normal life was gone. At first David tried as best he could to take care of her, but his strength and stamina were not up to the task. His children flew in to help, but after a couple of weeks they all had to return home, which wasn't near their parents. He was exhausted, discouraged, and depressed.

What could David do?

He began to bring in home health caregivers. They cost $20 an hour and Shirley needed care around the clock. He was able to keep this up for almost a year, but eventually David knew he'd have to turn Shirley over to someone who could really take care of her. She would have to go to an institution.

In just a few short minutes that night, everything had changed for David and Shirley. Their financial picture had changed too, and not for the better. David was truly worried now about running out of money. * 

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Topics: Long Term Care

Some Good Long-term Care Funding Alternatives

Posted by Larry Jones on Nov 2, 2021 9:30:00 AM

Are you ready?

Ready for what? Ready to live a long life.

"Well, yes, Larry. I am."

Everyone dreams of living a long and productive life. The good news is that, today you most likely will. Advances in healthcare have drastically extended the number of years the average human can expect to live.

A diagnosis of cancer was once a death sentence. Not anymore. With the use of extensive chemotherapy, radiation, and other treatments, many patients continue living for years after a cancer diagnosis. It's the same with strokes. 

These episodes may be quite expensive, however. The average bill for nursing home expenses may exceed $80,000 a year. How would your financial plan withstand such a drawdown? Could you endure a 3-5 year stretch of paying such expenses, which is a typical timeframe?

Does your plan take into account the possibility of an extended long-term care event?

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What you don't know can hurt you!

As a fiduciary I am required to always act in your best interests, and as a professional planner, it's my job to be familiar with all types of possible solutions and financial vehicles. In short, I have no interest in selling any particular product or any affiliation with a particular company. I work for my clients.

Are you:

  • concerned that your tax bill is too high?
  • tired of watching your nest egg decline by significant amounts every 5-7 years?
  • wishing you could find more free time?
  • looking for ways to help protect yourself against litigation that could destroy all you have worked for?
  • worried that Uncle Sam is going to enjoy your retirement more than you are?

If any of the above describes you and you'd like to get a question answered then just click the button below and we'll be in touch.

Let's Meet!

p.s. we have the ability to meet virtually regardless of your location! Give us a shout!


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