Estate And Asset Protection Planning Checkup

Do You Need An Estate And Asset Protection Planning Checkup?

By Roccy M. DeFrancesco, JD, CWPP™, CAPP™ - Email Editor - Editor Bio

Date : 16-Jan-2007

Dear Subscriber:

The vast majority of the people reading these newsletters make in excess of $100,000 a year (single or jointly with a spouse) and/or have a net worth in excess of $2,000,000 (which includes life insurance).

As a general statement, most of the public who earn a good living and/or have amassed wealth do not have the proper estate plan or Asset Protection Plan.

The following are statistics about attendees from the seminars I give:

- 1-2 will NOT have a simple will
- 9-10 will NOT have Durable Powers of Attorney
- 5-6 will NOT have marital living trusts
- 9-10 will NOT have a Family Limited Partnership (FLP)
- 8-9 will NOT have an Irrevocable Life Insurance Trust (ILIT)

The need for estate planning documents is obvious. You need a will, especially if you have minor children, to make sure the appropriate people receive custody of the children in the event of a terrible accident killing both parents. You need durable powers of attorney to make sure the living spouse or other loved ones do not have to go to court to make life-sustaining decisions or to sign legal documents for someone who is incapacitated. Living trusts are needed to maximize estate tax exemptions and to avoid probate. FLPs are needed to centralize governance of family assets and discount the value of the estate for estate tax purposes. An ILIT is needed to pass the death benefit to your heirs estate tax free.

If you do not have the above-mentioned tools, you need a checkup.

What about Asset Protection Planning?

Ask yourself the following questions:

1) Do you have real estate owned in your own name?
2) Do you own stocks or bonds in your own name?
3) Do you have significant equity in your personal residence and do not live in a state like Texas or Florida which asset protects the home’s value?
4) If you have a boat, Waverunner, snow mobile, plane, etc, are they owned by a multi-member LLC?

If you answered “no” to any, most or all of the above questions, you are in serious need of a checkup.

What about tax planning?

Ask yourself the following questions:

1) Are you paying too much in income taxes?
2) Do you have highly appreciated real estate or stocks you would like to sell but don’t because of the capital gains taxes?
3) If you own a small business, are you using tools like WealthBuilder Annuity or Carve-Out Defined Benefit Plans to reduce your income and fund tax favorable benefit plans?

If you answered “yes” to 1 and 2, and/or “no” to question 3, you are in need of a checkup.

Here is an interesting question:

Do you think your current team of advisors are familiar with the following topic?

The use of domestic LLCs, FLPs and offshore Asset Protection Trusts, The Maximizer, “Freeze” Partnerships, WealthBuilder Annuity, The Leverage Bonus Plan, Section 79, The 1% CFA Mortgage, Equity Harvesting, Equity Indexed Annuities, 401(k) Plans, New Comparability Profit Sharing Plans, Defined Benefit Plans, 412(i) Defined Benefit Plans (and carve out plans), VEBAs/419 Plans, ESOPs, Life Settlements, Reverse Mortgages, Equity Indexed Life Insurance, Charitable Remainder Trusts, Charitable Gift Annuities, Family Foundations, Qualified Pension Insurance Partnerships, Intentionally Defective Grantor Trusts, A/R Financing/Leveraging, Long-Term Care Insurance, HRAs, Drug Carve-Out Plans, Section 125 Plans, HSAs, Corporate Structure and many more topics.

If not, you are in need of a checkup.

The biggest dilemma I’ve found today when talking with clients is that they have no idea who they should turn to in order to second-guess the advice their current advisors have given them. The next dilemma is that if a client could find a knowledgeable advisor, the bill to receive a checkup would give most clients sticker shock ($2,500+).

That’s one reason I created the C.A.L.M. Plan. C.A.L.M stands for Comprehensive Asset Liability Management. The C.A.L.M. Plan has five levels to help clients from an initial review of their plan (Level 1), to a complete financial and estate plan for a client who has in excess of $25,000,000 (Level 5).

For people reading this “checkup” newsletter, I want to explain what a Level 1 C.A.L.M. memo is and why you need one. A Level 1 memo costs $495 and is put together either by me and/or a local Certified Wealth Preservation Planner (CWPP™). The memo is usually 8-12 pages and provides you with a comprehensive explanation of what is right and wrong with your estate, Asset Protection, tax and financial plan. Not only does the memo detail the pitfalls of your current planning, but the memo will outline many new and appropriate tools you can use to fix your plan and will make a recommendation as to what you should do to protect and grow your assets.

If you know you need a checkup, and my guess is that 99% of the people reading this newsletter can benefit by a checkup, I suggest you sign-up for a Level 1 C.A.L.M. memo. It will be worth every dollar you spend and more, and it is a memo you can take back to your current team of advisors to implement (if you so choose).

For more information on the C.A.L.M. Plan, please e-mail info@trustmakers.com.

Roccy M. DeFrancesco, JD, CWPP™, CAPP™

ABOUT THIS EDITOR:

Roccy DeFrancesco, JD, CWPP, CAPP, MMB - Author and lecturer, Roccy specializes in advanced estate and asset protection planning. Roccy's passion is to teach advisors how to implement lawful strategies that will hold up for the test of time.

Full Bio - Email Roccy

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