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Accretive Wealth Blog

Irrevocable Life Insurance Trusts: A Valuable Tool You May Not Know

Wednesday, June 25, 2014

Seat BeltYou buy life insurance policies to provide for your loved ones after you are gone. If your estate is large, however, some of the insurance proceeds may end up going toward estate taxes—and that’s important because the estate tax rate is now 40%.

To shield the payout from your life insurance policy, you can set up an irrevocable life insurance trust (ILIT), which becomes the beneficiary of your life insurance and allows the proceeds to pass to your heirs without being subject to estate tax. Basically, the trust owns the policy. Continue reading “Irrevocable Life Insurance Trusts: A Valuable Tool You May Not Know” »

So What Are CRUTs and What Can They Do for Me?

Wednesday, June 11, 2014

CRUTYou may have heard of a CRUT, which is a rather unpleasant acronym that stands for charitable remainder unitrust. While the acronym may be unattractive, a charitable remainder trust can be a very valuable tool that high-net-worth individuals can use for estate planning, income generation, tax savings, and charitable giving.

Basics

There are a number of charitable remainder trusts and other trusts that allow you to pass on assets to a charitable organization, and the rules for each of them are quite complicated. Continue reading “So What Are CRUTs and What Can They Do for Me?” »

What Will the Markets Do This Year?

Wednesday, January 15, 2014

Chart1We asked Advisor Partners, LLC, to give us their market outlook for 2014. Advisor Partners handles portfolio management for many of our clients. Here’s what CEO Daniel Kern told us:

Advisor Partners enters 2014 with a favorable outlook for equities, continuing the generally positive view we have had for the equity markets over the past two years. I would characterize us as “reluctant bulls,” similar to many advisors who have large allocations to equities but worry about a market correction. Our overall equity outlook has not changed dramatically as we enter 2014, but our outlook about the relative attractiveness of different equity asset classes has changed over recent weeks. Continue reading “What Will the Markets Do This Year?” »

Living Trusts Are Living Documents

Wednesday, December 4, 2013

Many of us delay putting together a living trust. Even if we have one, we have a tendency to view it as something we’ve completed, not as something we need to update regularly. In this post, we’re going to ask an estate planning attorney to tell us why a living trust is a very important document and why we need to make sure our living trusts are up-to-date. In future posts, we’ll look at other types of trusts that our clients and friends may find valuable. Continue reading “Living Trusts Are Living Documents” »

Tax Rates Are Going Up—Are You Ready?

Tuesday, November 12, 2013

Some big changes to federal income tax rates went into effect this year. Investors, small-business owners, and high-earners could have a rude jolt when they file 2013 tax returns, so we’d like to explain the changes and suggest some steps you could take to minimize the burden.

Here’s a look at the changes in 2013 tax rates that we think will have the greatest effect on our clients and friends:

  • The federal rate for long-term capital gains has gone up from 15% to 20% for a single person with taxable income above $400,000 or a married couple with income above $450,000. People in a 25% or 35% tax bracket will continue to pay 15%, while those in a 10% or 15% bracket do not have to pay capital gains taxes. Continue reading “Tax Rates Are Going Up—Are You Ready?” »

European Equities Offer Promise

Friday, August 23, 2013

After all the recent headlines about the European fiscal crisis and the impending doom of the euro, investing in the European equity markets may sound like folly. Taking a closer look at the developed markets of Europe, however, we think we’re approaching a good time to buy their equities. We don’t think these markets are going to turn around overnight, but we do agree with Wall Street powerhouses such as Credit Suisse and Bank of America Merrill Lynch that European equity markets are a good bet for the future.

In this blog post, we’re going to take a look at the international markets represented in the MSCI EAFE Index. “EAFE” stands for Europe, Australia, and the Far East, but the index actually includes only the developed countries in these regions: Australia, Austria, Belgium, Denmark, Finland, France, Germany, Greece, Hong Kong, Ireland, Israel, Italy, Japan, the Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, and the United Kingdom. Continue reading “European Equities Offer Promise” »

Are Stocks the New Bonds?

Wednesday, July 10, 2013

Some of our clients and friends have asked us what strategy they could use in this market to generate income from their investment portfolios. Bond yields are low, and bond risk is rising as issuers take advantage of today’s low rates to extend duration. Fixed-income securities as a source of income don’t look very compelling. What’s an investor to do?

Luckily, there is an option that many investors find attractive: portfolios that focus on growth and income through high dividend yield (HDY). A manager selects the stocks in these portfolios by identifying high-quality companies that offer a higher-than-average dividend yield. An HDY portfolio is characterized by: Continue reading “Are Stocks the New Bonds?” »

Be Smart About Retirement

Wednesday, June 26, 2013

Last week we talked about saving for your children’s education, but it’s even more important to create realistic plans for your own retirement. While you want to do the best for your children, you don’t want to ignore your own interests and jeopardize your ability to live comfortably later on. Retirement lasts longer than it used to: A man who’s 50 years old now is expected to live to be 82, while a woman is expected to reach 85.

Many of us don’t realistically think about our retirement, if we think about it at all. Let’s take a look at some numbers from the National Institute on Retirement Security’s June 2013 report, The Retirement Savings Crisis: Is It Worse Than We Think? (The answer is a resounding yes.) Continue reading “Be Smart About Retirement” »