Do I Need A Trust? | Dawn M. Dale, Esq.

LoudounMayJune2016HighResNoBleeds_Page_25I have received a number of calls about estate planning and it is very interesting how many people believe that they MUST have a trust as part of their estate plan. At first, I thought this meant that these individuals had spent some time reading about estate planning, which is wonderful. I am a big proponent of educating oneself. However, in too many of these cases, I learned that this belief was based solely upon the “advice” they received while attending a seminar, often over dinner at a nice restaurant or by attending a “free” webinar.

Like the presenters of these events, I believe that trusts are extremely valuable tools and the incorporation of a trust as part of one’s estate plan should be carefully considered. Where I differ,  however, is that I do not believe that the use of a trust is right for everyone. Unlike a Will, Advance Medical Directive and Durable Power of Attorney, the decision to incorporate a trust into your plan should be based upon careful consideration of a number of factors.

So, what are some of the key factors:
Are you concerned about a potential incapacity? Do you anticipate having someone assume management of some, or all, of your financial affairs?

Size and Nature of Your Estate
What is the value of your estate? Do you own real estate in multiple states or even countries? Do you have business interests that you want to be managed and maintained for your heirs?

Your Beneficiaries
Who are the intended recipients of your assets? Are any of them minors, have special needs or suffer from a disability? Are you concerned about their ability to manage wealth or the potential loss of wealth in the event of a divorce or a creditor claim?

Dispositive Goals
Do you intend to leave your estate outright to your beneficiaries? Do you want to benefit multiple people with some portion of your estate over a period of time (i.e., a pool of funds to provide educational assistance to all of your grandchildren)? Do you want to provide protection from the claims of a divorcing spouse and creditors? Do you want to provide for professional management of your estate while your beneficiaries are young or do not possess the knowledge and experience to manage the inheritance?

Generally the terms of a trust remain a private matter, whereas the terms of a will become a matter of public record.

Including a trust in your estate plan will increase the cost of preparing the documents. After your death, the trust becomes a separate and distinct taxpayer so there will be costs associated with preparing the income tax return. There may also be a fee charged by the trustee to manage the trust assets.

A trust adds complexity. It is a separate legal entity which must be managed properly.

In summary, the decision to include a trust as part of your plan should be based on an analysis of your unique situation and an evaluation of the costs and benefits of the trust. Situations change and this decision should be re-evaluated during your periodic estate plan reviews. If you would like to learn more, please call to schedule an appointment.

Dawn M. Dale, JD, LL.M., CFP®
McLean, Virginia 22102
(703) 244-6611

Do I Really Need A Will? | Dawn M. Dale, Esq.

LoudounMarApr2016HRNB_Page_13I am often asked, “Do I really need a Will?” The answer is a resounding, “Yes, but what you really need is an Estate Plan!”

In the last two issues of the Virginia Woman Magazine, I reviewed the Estate Planning Process and provided a summary of the legal documents included in a foundational estate plan and list of action items to be completed as part of the planning process. It isn’t just about having a Will.

Many people believe they don’t need a Will because they are single, they don’t have a large estate or “my spouse will inherit everything anyway.” Not taking the time to work through the estate planning process and execute the necessary documents typically leads to more complexity and expense for you and your loved ones and unintended consequences. So, why should you have an Estate Plan (The following is based on Virginia Law):

YOU designate an agent(s) of your choosing to make your personal, medical and/or financial decisions in the event you are not able to do yourself and you control which decisions they are permitted to make. For example, do you want your agent to be able to change the beneficiary on your retirement account or life insurance, make gifts of your assets or terminate life support if you have a terminal condition?

Without the necessary legal documents in place, if you become incapacitated, your family will need to seek the appointment of a Guardian to manage your personal and medical affairs and a Conservator to manage your estate and financial affairs. This requires that a Court declare that you are legally incapacitated. This process is a matter of public record and may result in your losing valuable legal rights. It also results in increased costs associated with the court proceedings and ongoing supervision of your agents.

Virginia law does provide some assistance in the area of medical decisions. If you are unable to make medical decisions, state statutes provide a list of individuals that can make some of these decisions for you without a declaration of incapacity. However, these individuals may not be the individuals you would have chosen and the individuals you would want making your decisions may not even be consulted.

YOU have the ability to make may key decisions, including:
• Who will inherit your assets and the terms and timing of the inheritance,
• Who will be responsible for raising your minor children and managing their financial needs,
• Who will be responsible for managing your estate,
• The extent to which your estate is subject to the probate process, and
• How to implement strategies that can minimize taxes, provide creditor protection and financial management.

Without a plan in place, state and contract law and the courts will make these important decisions for you. Some assets may pass to a joint owner or named beneficiary. The rest will pass under state law. This can result in people inheriting the wrong amounts, inheriting at the wrong time or even the wrong people inheriting your assets. If you have minor children, it could give rise to court appointed Guardians for the child and Guardians for the child’s estate. It often increases the costs of estate administration and creates delays in the timing when your heirs will have access to their inheritance.

Estate plans should be designed to address your situation. They do not need to be complex and expensive if you have a simple situation. If you would like to learn more about your estate planning options, schedule a complimentary consultation.

Dawn M. Dale, JD, LL.M., CFP®
McLean, Virginia 22102
(703) 244-6611

How Money-Wise Are You? | Valerie P. Kaiser

LoudounMarApr2016HRNB_Page_11Many women are more involved with their finances now, than compared to a few short years ago. But, are they getting the most out of their investment or investing in line with their life stage? To take full advantage of the opportunities in the financial markets and ensure that your money matters are sound today and tomorrow, it is important to take even greater control of your financial future.

Financial security has become a top priority among women. And, security about any topic is rooted in confidence and knowledge. Part of becoming a
savvy investor is making a commitment to learn to learn about investment basics and increasing your ability to confidently manage your finances.

Be involved in your money matters

When it comes to household responsibilities, many couples find it easier and more productive to divide and conquer. This may be a sound practice
for household chores, but it is not a strategy that should be followed when finances are concerned. It is more important for both spouses to be equally
involved in all joint financial discussions and decisions.

Develop the ability to manage your own assets

There is a 90% likelihood that a woman will be financially self-reliant at some point in her life due to divorce, becoming a widow, or choosing to marry later in life or not at all.*

Do your homework

Successful investors research option and thoroughly understand what they are buying. Women are responsible for most of the consumer purchases
in the U.S. This shows that women are generally educated and careful consumers, which can make them savvy investors, too.

Put your needs first

If you are like most women, you spend a good amount of time taking care of others – and that sometimes means setting our own needs aside. But,
investing for your own retirement is a necessity that you cannot afford to put off.

Step outside your comfort zone

An important part of investing is to identify the amount of risk you are comfortable with. When it comes to their investments, women tend to be less willing to accept risk and generally gravitate toward ‘safer’ investments. Following the strategy could leave you more susceptible to the long-term effects of inflation which could make it more difficult to achieve your financial goals. While no investment should keep you awake at night, considering options that carry slightly more risk than you build a strong financial foundation. Your financial professional can help identify appropriate options that will continue to support your goals.

*Wise Women Money Quiz: How Money Wise Are You? Cynthia Fick, 2011

Valerie P. Kaiser, CFP®
625 Elden Street. Suite 203 Herndon, VA 20170

Estate Planning, Part 2 | Dawn M. Dale, Esq.

LoudounJanFeb2016HR_Page_19In the November/December issue of the Virginia Woman Magazine (page 29) we reviewed the definition of estate planning and provided a list of the legal documents and action items included in a foundational estate plan. In this issue, we will provide a summary of each of the foundational documents.

The Last Will and Testament takes effect at death. The primary purpose of the Will is to identify the individuals and/or organizations that will inherit your assets upon your death. It may also include provisions to:

  • Designate the person(s) responsible for administering your estate.
  • Designate the person(s) to serve as a Guardian for any minor children.
  • Establish trusts to receive and hold assets for your heirs.
  • Provide for the minimization of income, estate, inheritance and other transfer taxes.

The Revocable Trust takes effect upon execution of the document. The primary purposes of the Trust are to provide for the administration of your assets during your lifetime and to provide for the disposition of your assets upon your death. It is often combined with a simplified form of a Last Will and Testament called a “Pour-Over Will” as a strategy to “avoid probate” and to achieve a level of privacy not available with a Will alone. The Trust may also include provisions to:

  • Designate the person(s) responsible for administering your trust while you are alive and after your death.
  • Establish additional trusts to receive and hold assets for your heirs. These trusts offer the potential for financial oversight and mentoring as well as a higher level of asset/creditor protection for your heirs. A single trust can also provide benefits to a group of beneficiaries without the need and complications of joint ownership.
  • Provide for the minimization of income, estate, inheritance and other transfer taxes and probate expenses.

The Durable Power of Attorney identifies the person(s) you have designated to handle personal and financial matters for you in the event you are unable to do so. Without this document, it may be necessary to have a court appointed guardian/conservator to handle your personal and financial affairs if you become temporarily or permanently incapacitated.

An Advance Medical Directive is a common name used for the legal document that contains the provisions of both a Living Will and a Durable Power of Attorney for Health Care Decisions.

  • The Living Will component directs your attending physicians regarding the use of life sustaining measures, which include artificial administration of food and water and the use of pain relieving medications, in the event you are diagnosed as terminally ill with no reasonable chance of recovery.
  • The Durable Power of Attorney for Health Care Decisions component identifies the person(s) you have designated to handle medical decisions for you in the event you are unable to do so. This is particularly important should you become incapacitated – either temporarily or permanently.

HIPAA Authorizations identify the person(s) that you would like to have access to your medical information. Without this authorization, your family/agents will not have access to information needed to make decisions on your behalf. HIPAA authorization language is commonly included in a POA, AMD and the Revocable Trust.

The Durable Power of Attorney for Burial Arrangement identifies the person(s) that are authorized to make arrangements for the disposition of your remains and plan your funeral/burial. Powers of Attorney for Medical Decisions involving Minor Children are a form of POA that allow you to identify the person(s) to handle medical decisions for your minor children in the event you are unable to do so.

If you would like to learn more about your estate planning options, we are here to help.

Dawn M. Dale, JD, LL.M., CFP®
McLean, Virginia 22102
(703) 244-6611

Creating Your Personal Financial Strategy in 2016 | By Valerie P. Kaiser

LoudounJanFeb2016HR_Page_17While many firms do strategic planning, we want you to know, we not only do it, we do it well.

Helping our clients to clearly define objectives to create credible and focused plans with results is our goal. Looking forward to serving you and helping you throughout 2016 and beyond.

Consider the checklist:

Prepare And Follow A Spending Plan
More than half of adults do NOT have budget. Putting it on paper or your wireless device is essential to your success. Without a budget and a plan
for spending, it is difficult to achieve your goals. Make it your business to sit down in January. Plan your year with a budget for spending and saving.

Pay All Bills On Time
Nearly 24% of all adults do not pay bills on time.* Paying bills on time will increase your credit score and also allow for better rates when borrowing.
It is always a good thing to do the right thing. Make paying all bills on time a part of your DNA and a positive character trait you embrace. It is never
too late to make the shift. Changing bad habits NOW and the way you handle credit including bill paying will benefit you in the long run.

Review And Update All Legal Documents
• Will
• Trust
• Contracts
• Citizenship
• Passport

Review Homeowners Insurance
Don’t forget to add newly acquired high value items including jewelry, art, etc.

Estimate Federal And State Income Tax In Advance
January is the perfect time. Determine if you can contribute more to your tax deferred retirement plan or IRA to reduce your 2015 taxes.

Review Health Insurance Plan
Call the member service line to discuss your health insurance plan. Review all benefits. Plan to change from year to year.

Review Life Insurance Coverage
Make sure you have adequate coverage. Consider supplemental benefits and coverage including disability, long term care and additional health insurance depending on life cycle changes.

Check Your Credit
Clean up any unresolved issues in your credit history.

Calculate Your Net Worth
Assets minus liabilities equals net worth – Make sure yours is positive!

Review Al Long And Short Term Debt
If disaster strikes (house burns down, unexpected surgeries, etc.) will you and your family be OK.
• Plan accordingly
• Stay committed
• Create and live your plan

And have a great year!

Valerie P. Kaiser, CFP®
625 Elden Street. Suite 203 Herndon, VA 20170

Everything Is Political… Including Your College Plan | Luanne Lee, CCPRS

LoudounJanFeb2016HR_Page_33One of the more interesting (and overlooked) differences of the Obama vs. Romney presidential election of 2012 was related to income taxes… and Financial Aid:

• President Obama paid income taxes of 20% on income of $3 Million.
• Mitt Romney paid much less, 14% on income of $21 Million.

Even though he out-earned President Obama 7-to-1, Romney paid a lower tax rate than his opponent.

President Obama and many Americans were angry, saying Romney didn’t pay his “fair share.” But, instead of the anger, why did we not ask how that was possible? How did Mitt pay only 14% on his income while President Obama paid 20%? It’s a one word answer: “Specialist.”

Romney had tax and legal experts to advise him on how to legally cut his taxes, ensuring his legal and accounting bills were in the hundreds of thousands. But that “expensive” advice saved him millions. Not so expensive when you consider his return on investment, is it?

I am the Specialist in my field: College Financial Planning. My advice contains specialized knowledge that, if implemented, can save you thousands, even tens of thousands of dollars. My clients typically see a return on their investment in the 5:1 range, meaning that if they invest $2,500-$5,000 they see a payoff (grants, scholarships) that multiplies their initial investment.

For example, if you are a high net worth business owner, I may point out overlooked “tax scholarship” strategies that your CPA overlooked because they do not understand the interrelationship between the Dep’t of Ed financial aid rules and the IRS tax code. Or, if a family has saved money in the “wrong” places, and I show them why, how and where to shelter those funds, increasing eligibility by $10,000, $15,000, even $20,000, per year.

After helping your child pick the right career-major-school (in that precise order) they eliminate transfers and graduate in four years instead of the average five or six. Not only will your student flourish, but so will your wallet. Plus, through Financial Aid negotiations with colleges, it is possible to save half a year’s salary!

What I am saying is this: College is expensive. But NOT hiring a Specialist can be even more costly. I offer a 30 minute “Pick My Brain” College readiness phone consultation for $75.00. Honestly, I used to offer this for free, but I found people equate free to a “sales pitch” or nothing of value. This 30-minute phone call can easily save you thousands in mistakes, which I think is a pretty good return on investment, don’t you?

Who should jump on this offer? Any busy parent with children in eighth through eleventh grade who thinks: we make too much or too little, are we too early or too late, you have saved or you haven’t, or you may feel helpless and confused and you don’t know where to start… That’s exactly why we should chat! Call us to schedule your “Pick My Brain” College Check-up Call today!

By: Your College Planning Coach, Luanne Lee 703.928.9036

P.S. We can talk about picking schools, choosing a major that will actually help your child succeed after college, scholarships, loans, grants and other
financial aid, or personal finance questions… you name it, it’s your call. The clock is ticking!

Val Connects The Dots… Career Transitions | Valerie P. Kaiser CFP

LoudounNovDec2015HighResNoBleeds_Page_27Part Two – Discover Your Purpose, What Are Your Intentions?

Leaving the security of a manager position in the corporate world with a six-figure salary and 10 weeks of paid time off for my new career as a New York Life agent with commissions only compensation was both daunting and exciting. I was following my dream for autonomy and control so that I could help others. It was a challenge that I embraced knowing that I had my family’s support. Any new business takes about five years to become established. We had our work cut out for us!

It was very soon after that I discovered that I was pregnant with my fifth child. Waiting to complete our family was not an option since I was in my forties. Growing a new business and having a baby at the same time sharpened my focus on what is most important – people. I often say that I take care of my family and my clients.

Both my growing family and business have rewarded me many times over these last 19 years. As my youngest soon enters college, my business is preparing for another expansion as we merge our practice with another established firm. In the New Year, we will announce our new business name as we finalize our merger with Tony Fulkerson, CFP® of Fulkerson Financial Group. Please note our new location in Herndon at 625 Elden Street, Suite 203. More to come soon!

In the meantime, we will continue to focus on our clients and their most important financial goals. Our purpose is to help People; our intention is to provide ongoing guidance and support to help them realize their dreams. One important part of that is to become A S.M.A.R.T. spender. Set S.M.A.R.T. financial goals (Specific, Measurable, Achievable, Realistic and Time bound) and create a spending plan in 4 steps:

1. List your income
2. Compare your income and expenses
3. List your expenses
4. List your resources and set priorities

Next, develop a savvy investment strategy: Finding the right mix of investments depends on your available assets, your financial goals, your time horizon, and your tolerance for risk. It is important to ensure a balance between three things: liquidity, return, and risk. Start systematically investing as soon as you are able so that a reasonable amount is saved, even after just a few years. The compounding effect can help to speed up your savings.

Remember, you are your most important asset: For most people, human capital is the missing piece of their portfolio. You insure your car, in the event you get into an accident. You insure your belongings, in case they’re lost or stolen. Your biggest asset is your ability to get up every day and provide for your family, whether by working or being the primary care giver. How do you insure your biggest asset?

Interested in learning more? We are here to help you get started.

Valerie P. Kaiser, CFP®
625 Elden Street. Suite 203 Herndon, VA 20170

When She Is Her Money’s Keeper | Valerie P. Kaiser

LoudounJulAug2015_Page_21In previous generations, there was most likely a man at the head of the household who was responsible for making all of the family’s financial decisions. While it may be a difficult concept to grasp now, many women were not even aware of how or where the family’s savings were invested.

Fast forward to today. Woman are powerful and accomplished, earning and achieving more than before. Many women successfully handle the demands of a family, career, and household. In fact, a recent study found that 90% of women identify themselves as “chief financial officer’ of their
household. In addition, the education level attained, the earning power, and career achievements of women are greater than ever before.

Despite these triumphs, women lag behind men when it comes to taking the necessary steps to build wealth and financial security – such as investing and establishing a long-term financial plan. They also face several unique challenges throughout their lifetimes, making proactive financial planning even more important.

Whether the reason is insecurity about the subject of money, a shortage of the time necessary to organize financial matters, or a heavy reliance on others to manage longer-term finances, it is important for women to overcome these barriers and take control of their own financial future.

Understanding the importance of long-term financial goals, as well as the steps to take to help make them a reality, are the first steps to a bright financial future. You may have already discovered the importance of working with a financial professional to help you develop a personalized investment strategy. As you move through the various stages of your life, remember that your financial professional is a valuable resource who can help you regularly review and refine your personal financial needs and, as your circumstances change, recommend any adjustments to your investment strategy.

Valerie P. Kaiser, CFP®

You are Powerful BUT Are you Prepared? | Valerie P. Kaiser CFP

LWM_MJ15_web_Page_21Many women are more involved with their finances now, than compared to a few short years ago. But, are they getting the most out of their investment or investing in line with their life stage?

To take full advantage of the opportunities in the financial markets and ensure that your money matters are sound today and tomorrow, it is important to take even greater control of your financial future.

Financial security has become a top priority among women. And, security about any topic is rooted in confidence and knowledge. Part of becoming a
savvy investor is making a commitment to learn to learn about investment basics and increasing your ability to confidently manage your finances.

  • Be involved in your money matters… When it comes to household responsibilities, many couples find it easier and more productive to divide and conquer. This may be a sound practice for household chores, but it is not a strategy that should be followed when finances are concerned. It is more important for both spouses to be equally involved in all joint financial discussions and decisions.
  • Develop the ability to manage your own assets… There is a 90% likelihood that a woman will be financially self-reliant at some point in her life due to divorce, becoming a widow, or choosing to marry later in life or not at all.
  • Do your homework… Successful investors research option and thoroughly understand what they are buying. Women are responsible for most of the consumer purchases in the U.S. This shows that women are generally educated and careful consumers, which can make them savvy investors, too.
  • Put your needs first… If you are like most women, you spend a good amount of time taking care of others – and that sometimes means setting our own needs aside. But, investing for your own retirement is a necessity that you cannot afford to put off.
  • Step outside your comfort zone… An important part of investing is to identify the amount of risk you are comfortable with. When it comes
    to their investments, women tend to be less willing to accept risk and generally gravitate toward ‘safer’ investments. Following the strategy
    could leave you more susceptible to the long-term effects of inflation which could make it more difficult to achieve your financial goals.

While no investment should keep you awake at night, considering options that carry slightly more risk than you build a strong financial foundation. Your financial professional can help identify appropriate options that will continue to support your goals.

By Valerie P. Kaiser, CFP®

Why a Financial Plan is so Important | Kaiser Financial Solutions

LWMJanFeb2015-smallfinal_Page_29Many of us are familiar with the expression, “failing to plan is planning to fail.” As a Certified Financial Planner®, I can assure you that—when it comes to financial goals and objectives— this old adage still rings true.

In fact, it may be more relevant than ever. As the last few years have shown, it isn’t easy for most Americans to make financial headway. With pensions in decline, interest rates near historic lows, and household incomes yet to bounce back to prerecession levels, it takes persistence and sound planning in order to get ahead.

Not sure how to begin? That’s okay—it’s easy to become overwhelmed if you think about all your needs at once. Instead, try taking it one step at a time, starting with the basics:

Build an emergency fund—No matter where you are in life, it’s important to set aside 8-10 months of living expenses. You don’t have to do it all at
once, but every dollar you save today is a dollar you won’t have to borrow if something unexpected happens.

Protect your home and family—Most of us have people who depend on us to keep a roof over their heads and food on their plates. That’s a big responsibility, but it’s one life insurance can help you meet—even if something tragic takes you away. You can start with an affordable term life
plan at first, and then add more coverage as your needs and budget grow.

Prepare for major expenses like college—As a parent or grandparent, you naturally want the best for your loved ones. Now’s the time to start a college or wedding fund so they won’t have to go into debt to make their dreams for the future come true.

Get ready for retirement—There are plenty of ways to set aside money for retirement: 401(k)s, IRAs, and fixed deferred annuities* just to name a few. But they all have one thing in common—the sooner you start, the better off you’ll be in the long run. Try to increase your contributions over time—perhaps 1% with each raise—or, if you are age 50 or older, look into some of the ‘catch-up’ provisions that may allow you to contribute even more. While the recession forced many of us to take a step back financially, it also helped refocus our attention on the things that really matter. A sound

financial plan can help us accomplish many things—but perhaps the most important is making sure we never lose sight of them again.

By Valerie Kaiser, CFP®, Agent, (CA#0F39945)
New York Life Insurance Company

All rights reserved Ruby Red Press LLC 2016