39 Wealth Management Issues

The 39 Wealth Management Issues™

The 39 Wealth Management Issues™

To guide conversations between spouses, partners, families, and advisors, we created a comprehensive framework that addresses thirty-nine of life’s most traditional wealth management issues. This blog is dedicated to current and relevant articles connected to these wealth management issues.

Retirement Planning

Retirement Funding

Schools today don’t have required classes on 401(k)s and IRA’s. Here is where you learn about saving for life after you stop working and transition to retirement.

Social Security Decisions

The decision of when to take Social Security depends on your circumstances. You can start taking it as early as age 62 (or earlier if you are a survivor of another Social Security claimant or on disability).

Nonqualified Employee Benefits

The term “nonqualified” means that the plan is not required
to meet most of the requirements of (ERISA) or the Internal Revenue Code that are imposed on tax-favored, or qualified, plans.

Retirement Income

Your retirement income should be about 80% of your final pre-retirement salary. Thus if you earn $100,000 gross annually at retirement, you need at least $80,000 per year to have a comfortable lifestyle after leaving the workforce.

Defined Benefit Plan Strategy

Typically most people don’t establish their pension income until they fully retire though many pension plans allow you to start collecting early retirement benefits as early as age 55. If you decide to start receiving benefits before you reach full retirement age, the size of your monthly payout will be less than it would have been if you delay.

Trust & Estate Planning

Lifetime Gifting  to Children/Descendants

When both spouses are U.S. citizens, they can give an unlimited amount of assets to each other without incurring a gift tax. Tax-free annual gifts to anyone other than a spouse are limited to $15,000 per year.

Executor/Trustee Issues

Estate and Trust administration can take a long time. If there is a dispute, it might take years rather than months. The planning tools we offer to address this potential problem head-on and help to mitigate disputes before they happen.

Durable Power of Attorney Issues

durable power of attorney means that the document stays in effect should you become incapacitated and unable to handle matters independently.

Titling of Assets

The title of an asset is the governing document that specifies who owns the asset and what happens to the ownership when the current owner passes away. The title also determines how the property can be financed, improved upon, or used as collateral.

Wealth Transfer Through Estate

Some estate plans remain a work in progress because of either evolving legislation to family conflict or indecision. Consequently, post-mortem planning is inevitable; it is merely reduced in scope
and complexity where lifetime actions are taken. The more comprehensive the estate plan during life, the fewer reactions and
decisions that executors, trustees, and the family must take.

Non-U.S. Citizen planning

A non-U.S. citizen spouse does not enjoy the Unlimited Marital Deduction as a U.S. citizen spouse would, thereby impressing estate tax on assets over the Estate Tax Exemption amounts. Unique planning strategies are important for non-U.S. citizens’ spousal planning.

Special Needs Planning for Loved Ones

A good special needs attorney will also have developed deep ties with care managers, therapists, and many other service providers within the community. As a result, they can be an invaluable guide to other resources needed by the individual and family.

Taking that first step towards long-term special needs planning may seem daunting. But it’s the best way to ensure that a loved one with disabilities can remain financially and socially secure.

Investment Issues

High Correlation of Asset Allocation

Correlation is a measure of how investments move relative to one another. Assets moving in the same direction at the same time, are considered to be highly correlated. When one asset tends to move up when the other goes down, those assets are considered to be negatively correlated.

Stock Options

IRS rulings have recently clarified how options will are treated and valued. These rulings present more opportunities to transfer the unrealized appreciation inherent in these options out of a client’s estate. A comprehensive understanding of how stock options operate is essential for modern estate planning.

Investment Over-concentration

How do you know if your account is over-concentrated? It depends on your investment objectives and needs. Few households may be able to afford the extreme risk of having a heavily concentrated position.

Investment Risk Management

Risk tolerance refers to how much an individual is willing and able to lose a given amount of their original investment in anticipation of getting a higher return in the future. For example, risk-averse investors withhold their portfolios in favor of more secure assets. On the contrary, more aggressive investors risk most of their investments in anticipation of higher returns

Asset Allocation Issues

Asset allocation refers to an investment strategy in which individuals divide their investment portfolios between different diverse asset classes to minimize investment risks. The asset classes fall into three broad categories: equities, fixed-income, and cash and equivalents. Anything outside these three categories (e.g., real estate, commodities, art) is often referred to as alternative assets.

Real Estate

Diversification is critical in real estate investments, just as in traditional capital market investments. Investors build portfolios that consist of different types of real property. Asset management involves mitigating risks and promoting valuable improvements.

Illiquid Investments

Today’s allocation models need to improve upon the one-dimensional comparison of expected return versus expected risk, especially when illiquid investments are added into the mix. Incorporating alternative investments requires an understanding of other important factors that affect investor outcomes. Rather than relying solely on correlation as a driver of allocation risk, the impact of illiquidity on other investment profile components, from spending to access to capital, needs to be considered. Anything less is falling back on the outdated models that have driven asset allocation decisions for years.

Insurance and Risk Management

Life Insurance Planning

The value that life insurance can provide to a comprehensive,
integrated estate plan goes far beyond providing cash liquidity through the payment of death benefits.

Disability Protection

Planning for disability is just as important as estate planning and can help minimize family conflict, protect family members, and ensure security and access to financial assets during incapacity. Mental or physical disability can occur at any time, often unexpectedly, and may last for years.

Business Continuation Planning

Business continuity planning is the process of creating systems of prevention and recovery to address potential threats to a company and enable ongoing operations during the execution of disaster recovery.

Business Succession Planning

Business succession planning is a series of logistical and financial decisions about who will take over your business upon retirement, death, or disability. To write a succession plan, the first step is to identify the ideal successor to take over the business, then determine the best selling arrangement. This usually involves a buy-sell agreement, secured with a life insurance policy or loan.

Asset Protection

When most people think about estate planning, they usually focus on leaving their property to the right people, at the right time, and with proper restrictions. They will also often think about avoiding taxes. However, one of the most important components of good estate planning is protecting assets from creditors, allowing those assets to be passed on to one’s heirs ultimately.

Medical Coverage/LT Care Planning

Often people think Medicare would foot the bill for LTC expenses, or at least most of it. But, Medicare only pays under limited circumstances and only up to a few months maximum. Medicaid is an option, but it requires that the applicant must be needy, both medically and financially.

Charitable Planning

Charitable Giving During Lifetime

When a gift is made during lifetime, you may receive an income tax charitable deduction today, and still, retain the right to use your property for life. Tax law allows you to deduct the present value of your future gift because the gift is guaranteed through several gift planning arrangements.

Charitable Giving Through Estate

Choosing the right planned gift depends on your personal circumstances and financial goals. The majority of planned gifts are deferred to be received through the donor’s will or other estate documents. Other deferred gifts included charitable remainder trusts and charitable gift annuities.

Financial Planning

Debt Financing

If you do not leave instructions about how to pay your obligations, your executor will pay them as required by the laws of your state. Some states leave it up to your executor to make good decisions about how to pay your debts and expenses.

Impending Major Purchase

Even if you’re already certain that you need the item or service you’re planning to purchase, you may not need all the features you’re looking for—or, if you’re finding yourself with relatively few options, you may need to expand your horizons to take in more.

Household Budgeting

The first step toward taking control of your financial situation is to do a realistic assessment of how much money you take in and how much money you spend. Start by listing your income from all sources.

College Expense Planning

529 Plans offer unparalleled flexibility in estate tax planning. A grantor can remain the “owner” of a 529 Plan and retain the power to change the beneficiary to a qualifying family member (which includes grandchildren, nieces and nephews, and others), while still removing the assets in the 529 Plan from his or her estate.

Debt Management

In a typical program, debt management companies work with creditors on your behalf to reduce your monthly payment and interest rates on your debt and waive or reduce any penalties. The parties agree on an affordable payment schedule that allows 3-to-5 years to pay off your debt.

Income Tax Planning

For decades, estate planning has been dominated largely by the desire to avoid a confiscatory federal estate tax. Under current tax laws, state and federal income tax planning will supersede federal estate tax avoidance.

Future Taxable Event Triggers

Business succession planning is a series of logistical and financial decisions about who will take over your business upon retirement, death, or disability. To write a succession plan, the first step is to identify the ideal successor to take over the business, then determine the best selling arrangement. This usually involves a buy-sell agreement, secured with a life insurance policy or loan

Financial Independence

Aging Issues

Many Baby Boomers have to worry about retirement planning and simultaneously helping their aging parents with their estate and financial planning. That means taking on a more hands-on approach to managing their parents’ financial affairs.

Family Financial Values

Experts say there is a 70 percent failure rate that includes rapid asset depletion and disintegration of family relationships during and after inheritance. Family values such as ethical will planning are as important, if not more important than the dispositive estate planning documents.


Maslow’s Hierarchy of Needs explains how individuals start at the bottom of the pyramid in an effort to meet their basic needs, then advance up the ladder towards a state of Self-Actualization. A need to build a long-lasting legacy can be accomplished through Estate Planning.

Pre and Post-Marital Agreements

A prenuptial agreement is a contract entered into before a marriage or civil union. A postnuptial agreement is a similar contract entered into after a marriage or civil union. These agreements are typically notarized and are generally subject to the Statute of Frauds, the common law requirement that certain contracts must be memorialized in writing to be enforceable. In determining whether postnuptial agreements are enforceable, as in evaluating prenuptial agreements, courts examine the circumstances of the negotiation process and whether it suggests duress or coercion, whether there has been full disclosure of assets liabilities, and whether each partner used his or her own attorney.

Financial Continuity with the Loss of Family Member

The loss of a loved one is a difficult time. Most people put off decisions while they come to terms with the situation. But sometimes, financial issues may be just too pressing to ignore or postpone. A Direction Memo and our other estate planning tools are powerful tools to prevent a lack of continuity at difficult times.