Estate Planning Softwares

By Yulun Hung

Estate planning software can be a smart way for people to save thousands of dollars on lawyers but it is not for everyone. Estate planning software is usually more suited for people that have estates worth less than $2 million, which is the amount federal estate tax is involved. Another recommendation is that people who have more than one marriage should not use estate planning software. Basically, if your estate plan is going to be complicated, a lawyer will be the better at handling your case. Estate planning softwares usually only cover the basics. If you think software can be right for you, here is a list of programs I got from The CPA Technology Advisor website that you can consider:

CCH Tax and Accounting - ViewPlan Advanced
"CCH Tax and Accounting’s entry into the estate planning market, ViewPlan Advanced, runs under Windows 95 or newer operating systems and requires a Pentium processor, VGA display, CD-ROM drive and a minimum of 14MB of hard disk space. I interviewed several users who were happy with the product."

BNA Software - BNA Estate & Gift Tax Planner
"The BNA Estate & Gift Tax Planner is the leader in estate tax planning, which is something we have come to expect from a recognized name and leader in all types of tax planning. This spreadsheet program is driven by solid foundations. The BNA Estate & Gift Tax Planner is a consistent application, enabling confident presentations. If you have used any other BNA program, you will immediately be ready to use the BNA Estate & Gift Tax Planner."

Thomson Fast-Tax — zCalc Tool Box Suite
"Thomson Fast-Tax offers the zCalc Tool Box Suite, a collection of analytical programs and other tools that act as an add-on to Microsoft Excel, providing additional assistance to estate planning professionals through features that enhance tax and estate planning strategies. "

Emerging Information Systems, Inc. ' NaviPlan Extended
"EISI introduced NaviPlan in 1996 and boasts a user base of more than 70,000. NaviPlan is another product in this review lineup that takes a broader approach to the planning process, including both goal-based financial planning as well as cash flow-based estate planning, which focuses on tax reduction and maximizing the amount of assets that can be passed to heirs. Since this review series features Estate Planning software, only the estate planning features will be highlighted. However, this package includes a lot more that you can learn about by reviewing the company's online information or by requesting a 30-day demo."

Sources:
http://www.cpatechnologyadvisor.com/article/article.jsp?id=731&pageNum=2
http://www.getrichslowly.org/blog/2007/10/31/a-brief-overview-of-estate-planning-software/
http://www.cpatechnologyadvisor.com/print/The-CPA-Technology-Advisor/Estate-Planning-Software-Review---2004/1$269

What are the components of an Estate Plan?

Written by: Liwin Troy Lee


Even though most estate plans are different from one another, they have similiar components. They include a will, a living will, a letter of last instruction and any trust instruments deemed necessary.

Will
The most imporant part of the estate plan is the will. A will is a legal document that transfer property when the property owner dies. The person who receives something from the estate is the heir. The will can also specify who will care for the minor children or dependent of the person who died.
In most states it is required that the assets be distributed after the person has died. If the person dies intestate, that is without a will, there are rules within each state to decide how the assets of the deceased will be distributed. If a person dies without a will and no living relatives, the assets of the deceased will become property of the state government through a legal rule called escheat.

Living Will
A living will is a document that specifies a person's preferences as to the medical care he or she would want to receive is they are unable to make the decision for themselves due to terminal illness, physical or mental disability.
The most difficult part in drafting the will is deciding what limitation to place on the medical care you're willing to receive.
A durable power of attorney is a legal document which designates that another person makes a decision for you in an event that you are unable to do so.

Letter of Last Instruction
The letter of last instruction is not a legal document. It provides useful information for the survivors of the deceased. The letter could be used to communicate the funeral arrangements, identify people to notify and important information such as bank account information. The letter should be copied and be distributed to everyone so everyone can find it when the deceased dies.

Trusts
Trust is an entity that holds and manages assets on behalf of someone else.

Sources
Top things to know
Estate Planning for Everyone
The Estate Plan

Estate Planning for Owners

Posted by Yulun Hung
Written by Burns Associates

If you’re a business owner, you probably have plenty on your plate just meeting each day’s challenges, but you’d be well advised to do some longer-range planning. About 70 percent of family-owned businesses fail to make a successful transition into the second generation. About 90 percent fail to be successfully transferred to a third generation of family members. These statistics reveal both the difficulty of transferring from one generation to the next and the lack of planning for successorship.

Small business owners have a host of special needs. Who will take over the business after you die? Do the surviving spouse or the children get control of the stock? Which ones run the company, and which merely share in the profits?

This article will look at some of the issues that you and your lawyer should discuss if you want the business to continue after your death. In a later article, we’ll look at some of the issues involved in selling your interest in the business and the best way to transfer ownership to the new owners.

Click Here to Read More.

The Trump tells us how it is done

By: Xavier Guerrero

Estate Planning: What You Need to Know

Posted by: Liwin Troy Lee
BY: Paul Sullivan

Estate planning rarely gets the attention it should get.

Saving for your children’s education, purchasing a second home, deciding when and how to retire — these are all topics that people talk about with their friends and their financial advisers. But deciding what happens to whatever is left of your money when you die is often passed over. It shouldn’t be, though, because it is crucial to a financial plan.

But not discussing something that is going to happen will not stop it from happening. And at some point, someone is going to have to sort out your estate — regardless of how big or small it is. Here are some of the key issues that should be addressed:

WILLS Everybody should have a will, and people who are married and/or have dependent children are inexcusably foolish if they do not. There are significant issues that only a will can clarify. One of the biggest is who will take care of the people you love, and how? You may have told your best friend that he will be the guardian of your children if you and your spouse die in a plane crash, but unless you spelled out your wish in a will, there is no guarantee this will happen. If both parents die, it will be up to the state to decide, and they will chose based on family.

If you say this is what you wanted anyway, you’re missing the point. Which parents would you want to raise your children — yours or your spouse’s? Or if it is a sibling, do you care if your children go to the wealthy one in Seattle whom you always fought with or to the financially strapped but loving one in Memphis with two children of his own?

Some may argue that wills are expensive. But there are plenty of online sites to help write a legally binding one for little cost. Two popular destinations are RocketLawyer and LegalZoom.

If you are wondering what will happen to your money if you die without a will, go to mystatewill.com. It shows what happens to your assets in each state if you die without a will. The picture it paints can be scary and may convince the holdouts that paying a fee online or spending $1,000 for an actual lawyer to draft a basic will is well worth it.

Click here to read more

How to become an estate planner?

Written by: Liwin Troy Lee

An estate planner is someone who plan for individual or corporate estates. Estates are collection of assets a person or entity obtained during their lifetime. Estate planning include drafting a will or trust fund, tax planning and planning for the amount of money you contribute to charity after you die.

1) Complete an advanced degree in law, finance or accounting. All three of those degrees gives you an education to make you qualify to work as an estate planner.

2) Enroll in a Certified Estate Planner Program. One of the most prestigious programs is National Institute of Certified Estate Planners.

3) Complete the course work to receive your Certified Estate Planner Degree. Some of the coursework will cover estate planning, gifting, joint ownership accounts.

4) One you pass all your coursework, you are qualified to sit for the Certified Estate Planner Exam. the exam consist of 100 multiple that covers all the material you have learned in your course work. You can take the test as many times a you want. There is, however, a $10 retesting fee.

5) After you get your certification. You must meet all the degree requirements. Generally you have to take 8 to 16 CPE credits every two years. An example of a CPE course includes advanced estate planning.

6) Agree to follow ethics set by the National Institute of Certified Estate Planners. This includes reading issues on professional ethics held by the organization such as not revealing you client's confidential information or engage in illegal activities. You have to sign a statement saying you have read the document.

7) Start promoting yourself as a certified estate planner.


Sources
National Institute of Certified Estate Planners
How to become an estate planner
Accredited Estate planners

A little story about estate planning 101

Posted by: Liwin Troy Lee
Written by: Chelsea Victor

LYONS – A guy walks into a bar. He recently found out that his elderly father will be passing away in a few years and leaving him a very large inheritance. Using this new information as leverage in the dating market, he decides it’s time to find someone to settle down with.

So guy looks around the room and locks eyes with this stunning young woman. He figures she’s probably out of his league, but walks up to her with his new boost of confidence and says, “I may not look like much now, but in a few years my father will pass away and I will have millions. Would you be interested in going to dinner sometime?” She’s interested, and gets his name and number. A week later, she became his step-mom.

What does this story illustrate? Sometimes women are better estate planners than men. Or, more appropriately, effective estate planning can protect your children’s inheritance. According to recent statistics, seven out of ten Americans do not have a will. This is a staggering amount considering the importance of having a will and medical durable power of attorney, the incentive to simplify the probate process, and the overwhelming availability of estate planning attorneys.

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Plan Ahead

By Yulun Hung

It is very important for people to take action on estate planning ahead of time. A lot of people tries to avoid the topic until something bad happens when they end up in the hospital. By then, it might already be too late. Even if they are still able to make their wills, the legal system of United States might prevent you from doing so!

For example, if a person is send to a nursing home and has symptoms of dementia from Alzheimer's, there is a law that states in order to sign legal documents, one must be able to think clearly and understand the nature of his or her actions. To have the mental capacity to sign a will, one must know simple things such as the who, what, and where.

If a person is not qualified to sign his or her will, a family member, relative, close friend, the attending doctor, or a court appointed guardian may be asked to make the decision on your behalf! Most people will probably not want someone else make such an important decision for them, so planning ahead is a very smart move. It will give the person a peace of mind to know that your wishes will be carried out.

Sources:
http://www.url.biz/Articles/Article-3498.html
http://www.thetimesherald.com/article/20090405/NEWS01/904050317
http://wiserwomen.blogspot.com/2008/02/estate-planning.html

Estate Planning for Pets

Posted by Yulun Hung

Written by Jessica Rivelli

St. Petersburg, FL -- Many people will remember the infamous recent story of heiress Leona Helmsly and her dog "Trouble," who inherited a fortune when Ms. Helmsly died.
In the real world, when everyday pet owners become incapacitated or even worse, pass away, what becomes of their pets? Without estate planning, the pets may be taken to shelters or even left for dead.
Starting at around $250, some tax and estate attorneys can help plan pet trusts and pet care. In this planning, an attorney can help designate a "backup person" who will care for a pet, which includes feeding, housing and paying for medical expenses. Usually a caretaker is a family member for friend.

Click Here to Read More.

Do I need Estate Planning?

Written by: Liwin Troy Lee

What is Estate planning?

Estate planning is a long process. It involves your family, people close to you and possibly a charitable organizations. Estate planning deals with your assets (property) and determining the owner of the assets after you die.

From real estate planning, you determine how and whom will manage your asset when you are not able to manage it, when to distribute the assets, who receives your assets after death, and how your healthcare decisions will be managed when you are not able to take care of yourself.

Many people think that estate planning is just writing a will. Estate planning involves more than that. It involves financial, tax, medical and business planning. Writing a will is just the beginning. You need documents to support your will.

What is involved in estate planning?

The first thing you need to determine is your assets and their approximate value. Second, you need to determine who will receive those assets. Third, you need to determine who will manage those assets after you pass away. Fourth, you need to determine how you should be care when you are in old age and sick. Finally, you want to determine what happens to your remains when you die. Once you have all the answers to those issues, it is then time to see your lawyer.

Who needs estate planning?
You do. You need to have someone manage your assets whether it is big or small when you are unfit to do so. If you asset is small, you should decide who will get your assets after you die. If you assets are big, you should speak with your lawyer and decide how your assets should be handled.


Sources

Estate planning
Estate planning- what you need to know
estate planning

Unusual Trusts Gain Appeal in Unusual Time

Posted by: Liwin Troy Lee

By: Mike Spector and Anne Tergesen

It may seem hard to come up with a financial product with a name as unattractive as an "intentionally defective grantor trust." Yet these days, in the world of estate planning, those words denote one sexy vehicle.

That's because this aggressive strategy -- which can be used to move money out of taxable estates and transfer gains to heirs tax-free -- is especially appealing at a time like now, when asset values have fallen sharply and interest rates are near historic lows.

Many estate planners warn that these trusts carry more risks than other accepted planning vehicles. The Internal Revenue Service hasn't blessed defective grantor trusts, and has challenged their authenticity in the past. What's more, if your assets perform poorly in this type of trust, you could get hit with greater losses than you would suffer with some other popular wealth-transfer techniques.

Still, most defective grantor trusts have withstood IRS scrutiny, and many estate-planning lawyers report seeing increased interest in them this year, in the wake of the tumble in the real-estate and stock markets. Neil Kawashima, a partner at McDermott Will & Emery LLP, says he expects he'll increase the number of these transactions he executes this year by nearly a third. Carl Waldman, an estate-planning attorney in Westlake Village, Calif., says he has set up about 25 of these trusts in the past 12 months, versus "probably no more than six" in the prior year.

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Do I Need Life Insurance?

By Yulun Hung

Life Insurance can be extremely beneficial to some people, but it is not necessary for many people. Life insurance can be expensive, and people have to consider his or her current financial position and loved ones as well before deciding to buy life insurance.

Here is a list of questions people should ask themselves before buying a life insurace:

How many people that I care about depend on my financial support?

How much money do people that depends on me need?
How long will it take for people that depends on me become self sufficient?

After deciding how many people and the amount of money for a life insurance, people should start figuring out the assets that will be avaliable for loved ones after they pass away. It is important to figure out an approximation of time these assets will transfer over to inheritors. Make sure these assets do not have substantial debts on them. Also, avoid probate and estate taxes as much as possible.

Sources:

http://www.nolo.com/article.cfm/pg/5/objectId/8B3B468D-B586-4653-BCA59430C001C6D6/catId/359CBC3A-078B-4DB7-A9F02D9E25A13D84/309/140/ART/

http://money.cnn.com/magazines/moneymag/money101/lesson21/

http://www.calbar.ca.gov/state/calbar/calbar_generic.jsp?cid=10581&id=2206

Your 5-minute guide to estate planning

By MSN Money staff

Posted by Yulun Hung

Even though most estates won't owe Uncle Sam, estate planning is essential for protecting you and your loved ones.

Most important? Providing for minor children. Your will should name both a guardian and a financial trustee for your kids in case you and your spouse die.

To provide checks and balances, the guardian and the trustee should not be the same person.
Don't name a couple as guardian. They could split up or disagree about what's right for your child.

Your child's other parent, even if you're divorced, will get custody if you die, unless that person is unfit because of mental illness or addiction.

Click here to read more.

How to Prepare for Real Planning

Written by: Liwin Troy Lee



1. Discuss with your spouse how you want your estate to be handled if you both die or one dies before the other. You should map out both scenarios.

2. Determine if you want your estate to stay within the family. That is, do you want your children's spouse or their children to inherit any part of your estate.

3. Determine if you want you children to inherit everything. That is, do you want to give everything to your children when you die or do you want to provide the income over a period of time. If you pick the latter, you have to decide how much to give out each period.

4. Discuss what will happen to the estate if you and your spouse gets divorced later in life. That is, will the estate still include your current and children or would you include your future spouse and future children as well.

5. Decide whether you want to include charities as part of your estate planning. If so, start looking for charities you would give to and for how much.

6. Look for a reliable financial adviser and trustee to handle your affairs. This is especially important if your children are minors when you die.

7. When you have all this information. You can then prepare your will.


Sources
How to Prepare for an Estate planning Meeting
12 Easy Steps to preparing your estate plan
Preparing for an estate plan

You'll want to read this before you die

By Kimberly Matas
Posted By: Liwin Troy Lee

Businesswoman Belinda Mossor was reeling from the unexpected death of her father, Harry, in 1998.

"It was total chaos," Belinda Mossor said. "My father was ex-military and ex-civil service, and he retired with 32 years in the military and 20-some in civil service. When he died, he had absolutely nothing in place. There was no will, there were no directives and it was extremely hard.

"He had not stipulated whether there was a life- insurance policy to help with the financial burdens," Mossor said. "He did not have anything in place for what he would want for burial or cremation. He just felt that Social Security or Medicare and the value of the house that they lived in would take care of her (Marjorie Mossor) and take care of everything."

It took three years for Mossor and her mother to sort out Harry Mossor's finances, insurance and other assets. Eleven years later, Marjorie Mossor is still learning new things about her late husband's finances. Recently, she received a letter from an insurance company informing her of dividends from a policy that belonged to him.

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The Smartest Investment During a Recession

By Ryan Dennin

In desperate times like these everyone is focused on where they can squeeze and extra penny or two. While it may be wise to cut down on trips that take up a lot of gas, or that extra trip to star bucks, it is important to not lose focus on the one thing that is guaranteed to happen. It may sound harsh but everyone will die someday and it is important that an estate plan be completed to ensure the people most important to you are taken care of. The recession may be the ultimate time to take care of the Estate Planning process that so many people have put off for all those years. While writing a sound estate plan may be an added expense it is not something that you don’t want to have in place. The government has a plan for you if you die “inestate” (without a will or trust) and having a plan ensures that YOU make the decisions to what happens to your assets not them. Another important point is putting a plan together for what happens to your assets isn’t an investment that will lose money during this time. It will ensure those items you own are there for the ones you love the most when you pass away. While many people may ignore investing and saving during a recession, an estate plan is not something I recommend passing on during these tough economic times.

Sources:

http://www.michiganestateplanninglawyerblog.com/2009/03/estate-planning-in-a-recession.html

http://ezinearticles.com/?Dont-Let-a-Recession-Control-Your-Estate-Plan&id=1982625

http://www.familybusinessinstitute.com/index.php/recession-planning?c65a6b5fa5030f7344292032b2ced578=a316e3ef6babba5ecdaacbfc37d06ae2

Choosing an Executor

Posted by: Ryan Dennin

For the most part, you're free to choose virtually anyone that you want to act as executor of your estate – within certain limits, of course. As long as your choice resides within these limits, the court is obliged to follow your preference in most cases. Generally speaking, the limits are these: you may not appoint a minor, an incompetent person or, in many states, a convicted criminal. Click here to read more

An Outdated Estate Plan is a Worthless One

by Greg Lipinski

There are a number of things that can occur in a person’s life that effect your estate planning. Obviously, death is one of them; hence the purpose of this blog. In that situation, the most notable effect is the need to implement your plan. However, people might have the misconception that because they have thoroughly completely their estate planning, that everything is safe. The only thing left is to kick the bucket and have it go into effect. That couldn’t be further from the truth.

It is extremely important to update your estate planning with any major happenings in your lifetime. If you don’t, there could be a number of problems that are run into when it comes time to allocating your assets to the necessary parties. Some events might include:

• Getting married, divorced, remarried, or any other legally recognized change in relationships
• The purchase of new major assets. These might include new cars or property.
• The birth of (or discovery of) children
• Changes in laws and regulations

Essentially, any major even that occurs can have an effect. With the ones above, you are simply solidifying the fact that your new wife becomes your heir, or that your ex-wife no longer inherits. Any change in your legal status or purchase of major assets need to be allocated. It won’t be assumed that because one of your cars is going to your wife that the new car purchased a few months before your death immediately goes to her.

As for laws and regulations, changes in the economic environment might cause you to either protect or take advantage of new tax rates, rules, etc. The idea isn’t only to leave your heirs with your assets, it is to leave them with as much of the assets as Uncle Sam will allow.

Above are just a few examples of why you should constantly stay updated on your estate planning. If you’re not sure if an event in your life is worth changing your estate plan over, err on the side of caution and review it. Take a look at it and ask yourself if it has even a miniscule effect on it. If it doesn’t, then you’re in the clear. If it does, augment it as soon as possible. You never know when the worst could happen.

Resources:
http://money.cnn.com/magazines/moneymag/money101/lesson21/
http://speculationrules.com/philosophy/estateplan.php
http://www.walletpop.com/retirement/article/_a/bbdp/estate-planning-and-taxes/92726

Bad economy boon for tax lawyers

Copied and Pasted by Rie Umano

The poor economy has many lawyers twiddling their thumbs - or getting pink slips - as legal work dries up. But the economic crisis has created a business boom for one subset of the legal industry: small to midsized tax practices.

"I am not suffering," said Charles Rubin, a tax attorney with Gutter Chaves Josepher Rubin Forman Fleisher in Boca Raton, Fla., and author of the blog Rubin on Tax. "I'm as busy as I've ever been."

Events over the past year have created a perfect storm of sorts, forcing small to midsized businesses and the people who run them to seek legal advice on a host of tax and estate planning issues.

Click here to read more

Estate planning mistakes

Posted by Rie Umano

It is not always fun task, but estate planning is necessary to transfer your assets to your heirs effectively. You might be able to avoid high federal taxes and estate taxes if you plan properly. It is always better to plan earlier and constantly check your estate planning as things change. However, even if you planned already, there are some mistakes you might make possibly. Here are some examples.
1. Failing to make an estate plan – when it comes to basis estate planning, it seems like most people simply avoid doing it. They just do not want to deal with death, complicated family situation, misperceived expensive costs and many other reasons. However, no matter what your situations are, you should start creating your estate plan. Otherwise, you will end up paying more money and hurting your family after you die. Make sure you keep updating your estate plan, so that it will work that way you intended.
2. Forgetting about little things – many people tend to forget their personal effects to the plan. Your jewelry, art work and collectibles can affect your estate planning as well.
3. Choosing wrong fiduciaries – many people tend to chose wrong people or institution to serve as their Personal Representatives or Attorneys. Choosing the right fiduciaries is pretty significant when you create your estate planning. Your plan would not work well if your fiduciaries cannot work efficiently.

Sources:
http://www.allbusiness.com/personal-finance/retirement-estate-planning/4005-1.html
http://wills.about.com/od/estateplanning101/tp/fiveplanningmistakes.htm
http://www.bankrate.com/brm/news/Financial_Literacy/Nov07_estate_plan_mistakes_a1.asp?caret=72a

Before Your Parents Say 'I Do' Again

Posted by Brian Redhead

It's rare that an inheritance passes from one generation to the next without leaving some scars. But smooth transitions are becoming even rarer thanks to the growing influence of a new player: the second spouse. As Americans live longer, they're more likely to move into second marriages, and legal experts and financial planners say the resulting friction with the kids is steadily mounting. In more cases grown children are going to court against their parents even while they're still alive, only to run up against a legal framework that leaves them with surprisingly few rights compared with their parents' new spouses. The once-sleepy field of trust and estates law is now brimming with hardened litigators. In Texas, personal-injury lawyers in search of big paydays have begun taking on will contests. And just as court squabbles are on the rise, so are prenups and sophisticated trusts that are designed to forestall them.

Naturally, there are more than bruised feelings at stake. The generation that’s growing old now is arguably the wealthiest in history, and many of their baby boomer kids are counting on inheriting some of their dough. But that legacy is under threat. The stock market’s nosedive and the housing slump have combined to wipe out $15.5 trillion in net worth in the last two years, according to the Federal Reserve. Along with this financial tumble, a growing number of would-be heirs face the biggest threat of all: a new stepmom or stepdad. According to a 2007 study by two Wharton professors, people over 65 are now more likely to be married than ever before, in large part because of a spike in late-in-life marriages. Even as the inheritance pie is shrinking, more family members are fighting for a piece of it.

Click here to read more.

Estate Planning for Your Pet

Post By: Dana Sunderlin

When dealing with estate planning, many people focus on the people and physical assets that they will be leaving behind when they die, but many of them do not take their pets into consideration. It has been found that a pet can suffer from sever anxiety when their owner dies. It is important that there will be someone around that knows your pet’s diet and medications, and that can keep them in their usual daily routines. In addition to having high anxiety, many pets wind up in shelters or on the streets after their owners pass away. To keep this from happening to your pet, make sure you include your beloved animal in your estate plan!

The simplest way to ensure the safety of your pet after your death is to find a friend or family member who is willing to take care of them, and to have an attorney draft a will leaving them to that person. You could also give the right to the executor of your will to choose amongst a number of people when the time comes. Another important thing to remember is that it will greatly help the person who is willing to take care of your pets if you leave them a certain sum of money to help with the cost of doing so. Creating a trust for your pet is also an option. Many states now have “pet trust statutes,” which allows you to set up a trust along with name a trustee and caretaker for your pet (s). Although there are two different types of pet trusts, many pet owners choose to use a traditional trust, which gives you more power and control over the terms of the trust.

Sources:

http://www.professorbeyer.com/Articles/Animals.htm

http://www.newyorktails.com/estateplanning.htm

http://www.mypeticulars.com/

Living Trusts vs Wills

By Steven Muller

A living trust is a legal entity that can own property and direct distribution of that property after a person's death. One of the benefits of a living trust is that it isn't subject to probate, or its associated costs and delays.

If you establish a trust, you appoint yourself as the initial trustee and primary beneficiary of the trust. You retain full and complete control over the property during your lifetime. In the living trust document, you appoint the individual or charities that will take on the role as successor trustee when you can no longer act as the initial trustee. After death all your assets are given to your beneficiaries without the hassle of probate. Probate is the process of properly transferring the estate to the rightful beneficiaries. This process is also used to collect any taxes due on the transfer of the property.

The property from the estate can be also transferred to the intended beneficiaries via a will. A living trust is sometimes referred to as a "will substitute." Although, in some respects, it does take the place of a will, a will is still usually necessary to distribute assets outside the trust, and to nominate guardians for minor children. The major difference between a will and a living trust is a will does not avoid probate and does not protect the management of your assets in the event of you should become debilitated during your lifetime.

Sources:

http://www.legalzoom.com/legal-articles/will-vs-living-trust.html

http://www.livingtrustvswill.com/

http://www.legalhelper.net/living-trust-vs-wills.aspx

In Rough Economic Times Don't Panic

By:  Jeremy Radnor

In life, it is only natural to react to the environment around you.  In todays financial environment, people are reacting negatively.  The news torments viewers daily with poor economic performance, dipping stocks, and major financial institutions falling apart and behaving poorly.  In the past year, the net worth of American households have dropped by the most ever in over half a century.  The FED reported a 9% drop in American net worth in the third quarter.  America's net worth as of April-June 2007 was valued at over $64 trillion.  Today, that value is down to just over $51 trillion.

Despite things being so bad, it is important that investors not over-react. Financial professionals have identified 5 investing mistakes not to make during this rough patch in the economy:

1. Dont wait it out - This doesnt mean dump your portfolio but it may be a good time to reallocate your current funds.  Also, make sure to diversify your current position.

2. Dont dump your 401(k) - Dont pay too much attention to its current situtation but dont forget about it either.  Dont pass up the chance for free money with employee matching plans.  Consider just putting in up to the matching point.

3. Dont hide behind CDs - Although they are relatively safe, they yeild very low returns and should be considered short term.

4.Dont think outside the box - Get back to basics.  Now is not the time to get creative and maybe refer back to investments that do well when stocks are performing poorly (such as gold).

5.Dont favor yor mortgage over your emergency fund - In case you lose your job, investors need to make sure that emergency stash is still there and available for at least 6 months.

Finally, it is always tempting to focus on the now.  However, it is more important, especially financially speaking, to plan for the long term and the future.  Keep track of your investments.  Based on your current financial position, try to predict where you will be by retirement and if you will have enough to live the way you want to when that day comes.

Links:

http://www.msnbc.msn.com/id/29657771/

http://www.msnbc.msn.com/id/29467436/page/2/

http://www.msnbc.msn.com/id/21563675/

Estate Planning in a Down Market

by Amy Feldman
Posted by Greg Lipinski

When times are tough, people tend to hold on to what they have that much more tightly. But for those who can get beyond that psychological response, there's a silver lining in today's combination of depressed asset values and low interest rates: Transferring assets to the next generation has rarely been less costly.

That's because depressed valuations allow you to get those assets out of your estate and over to your kids with less gift tax, while low interest rates create additional advantages for those who use certain wealth-transfer vehicles or intra-family loans. In fact, with the Federal Reserve cutting interest rates, the rates set by the Internal Revenue Service for use in one of the most popular wealth-transfer vehicles, known as a grantor retained annuity trust, or GRAT, is now at an historic low of 2.4%, down from 3.4% in December. The rates for intra-family loans are at similar historic lows, now just 0.81% for a short-term loan.

"If the markets are going to recover, then let that recovery be on your kids' balance sheet rather than yours," says Don Weigandt, a wealth adviser at J.P. Morgan Private Bank in Los Angeles. "The major issue is psychological. It's the brain battling the heart."

To read on, click here.

No More Too Big to Fail

Posted by Brian Redhead

The Obama administration is on the verge of rolling out a series of new regulations to prevent a repeat of the still rampaging financial crisis. But it’s not enough for policy makers to simply propose expanding the Federal Reserve’s enforcement power, or putting forth new rules for regulating derivatives, exotic securities and hedge funds.

What’s needed now more than anything, is a plan to ensure that no financial institution is ever again “too big to fail.’’ The seemingly endless bailouts of American International Group(AIG), Citigroup(C)and Bank of America (BAC)are all premised on the fear that if any one of these financial services giants were to fail, the global economic fallout would be catastrophic. And as distasteful as it may be, regulators and policy makers are correct that there’s no other choice than to save these firms.

But once these financial behemoths no longer pose a systemic threat, they need to be dismantled and dramatically shrunken. And the same must go for banks that aren’t on the critical list. So far, JPMorgan Chase & Co. (JPM)has managed to avoid becoming a financial basket case like Citi or Bank of America. But the world economy cannot risk a situation where some future crisis puts JPMorgan on the edge of disaster. If that means forcing relatively healthy banks to get smaller—either through voluntary divestures or old-fashioned trust busting—so be it.

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Bolting the Stable Door

Pasted by Brian Redhead

“THE TEMPEST”, or “A Midsummer Night’s Dream”? Scenes from both plays looked down on Lord Turner in the Drapers’ Hall as he explained on March 18th how the Financial Services Authority (FSA), the financial watchdog he chairs, will change and get much tougher. He chose to speak in the heart of the once-glorious City rather than in the casino-country of Canary Wharf, London’s wholesale financial district. There, the FSA has made itself perhaps too much at home.

His review anticipates a meeting of G20 leaders in London on April 2nd, which has financial regulation high on its agenda. European, indeed global, co-ordination is an important component of any effective new approach. But no matter what anyone else does, the FSA, whose reputation has been battered by the collapse of various banks under its supposedly watchful eye, must clean up its act at home, as it freely admits. This is a start.

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U.S. Rounding Up Investors to Buy Bad Assets

Copied and Pasted by Rie Umano

WASHINGTON — Obama administration officials worked Sunday to persuade reluctant private investors to buy as much as $1 trillion in troubled mortgages and related assets from banks, with government help.

The talks came a day before the Treasury secretary, Timothy F. Geithner, planned to unveil the details of the administration’s long-awaited plan to purchase troubled assets, meant to remove them from the balance sheets of banks and, in turn, spur banks to lend more money to consumers and companies.

The plan relies on private investors to team up with the government to relieve banks of assets tied to loans and mortgage-linked securities of unknown value. There have been virtually no buyers of these assets because of their uncertain risk.

As part of the program, the government plans to offer subsidies, in the form of low-interest loans, to coax private funds to form partnerships with the government to buy troubled assets from banks.

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A.I.G. The Brand is Tarnished

Copied and Pasted by Rie Umano

The government’s fourth round of assistance to the American International Group this month was a play for time — for languishing markets to rebound, for pockets to fill up again and for buyers to emerge for the sturdy insurance companies under A.I.G.’s tattered corporate umbrella. Only when those insurance companies are sold will there be money to repay American taxpayers.

But after the latest uproar, time does not look like A.I.G.’s friend. The problem now is not a toxic spiral of derivatives like the one that crippled the company last fall, but the damage done to A.I.G.’s brand, first by the financial troubles and then by the recent wave of hearings, subpoenas, late-night television jokes and even a bus tour past executives’ homes.

A strong brand is something no insurer can afford to put at risk. Insurance companies trade, more than anything else, on their image of strength and stability.

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Toxic asset plan nears completion

By: Jeremy Radnor

WASHINGTON - Treasury Secretary Timothy Geithner could announce as soon as Monday his much-anticipated plan to get toxic assets off the books of the country's struggling banks, administration and industry officials said.

The plan will use the Federal Reserve and the Federal Deposit Insurance Corp. to make the resources of the government's $700 billion financial rescue fund go further, the officials said Friday.

Geithner is being forced to tap the Fed and the FDIC for support because the prospects for getting additional money from Congress for the bailout effort have dimmed significantly given the recent uproar over millions of dollars in bonuses provided to troubled insurance giant American International Group Inc., the largest recipient of government support.

To read more click here.

Link:

http://www.msnbc.msn.com/id/29807119/

Re-evaluate your estate plan

By Jennifer Ng

Reevaluating your estate plan is crucial and necessary in order to not have your property and money ending up in the wrong hands in the future. It is said that you should update your estate plan when major changes happen in your life, such as financial changes, additional children, marriage/remarriage, and moving. Throughout everyone’s lives there will be changes that can significantly affect their estate plan; so it is important one revise their estate plan to make sure their wealth be distributed to the people they want. The estate tax is going to stay and cannot be taken away. Of course this is no big issue for those who have less than $3.5 million for that is the minimum a person can die owning before they are subject to the tax. But those who are/were to pay the estate tax lost a good amount of their wealth. This also meant their inheritors lost a good amount of wealth due to the estate tax. These factors cause problems in today’s estate plans that may not have been problems when first drafted. What caused these problems was that whoever drew up the estate tax did not prepare for the changes in economy.

Sources:
http://www.finweb.com/financial-planning/keep-your-estate-plan-up-to-date.html
http://www.nytimes.com/2009/03/21/your-money/estate-planning/21wealth.html
http://www.alllaw.com/articles/wills_and_trusts/article1.asp

Today's Job Market and Your Work-Life Balance

By: Jeremy Radnor

Everywhere you look today, it seems there is more evidence of the poor job market and weak economy.  The media would lead you to believe that things cannot get any worse and we are facing the end of the world.  This is obviously an exageration but the current situation should not be taken lightly.  It is time to take a closer look at the job market and how people are coping and behaving.  

To begin with, recently the unemployement rate has reached a 17 year high.  As terrible as this is, people are quick to forget that still over 90% of the US is employed.  This means that more than 9/10 people have a job.  None-the-less, as things seem to turn increasingly worse, the work-life balance that has been stressed in the past is quickly being forgotten.  Employers and employees used to promote a balanced approach to work and life.  This has benefits for both the employee and employer.  Employees have more free time and feel better.  This leads to better work in the work place.  Today, there is no balance.  It would appear the work force has been divided into two segments, work and life.

The work group can be divided into two additional segments.  The first group being those who work to ensure they are employed.  This group consists of employees who work ridculous hours in a day just to ensure they arent fired.  The second group are those who work out of love.  With the job market as it is, many people have been forced to try new and different careers (careers of passion).  Employees are finding themselves feeling happier and more fulfilled.

As for the life group, these people have decided to simply ignore the current situation.  This is extremely evident within generation-Yers.  Many generation-Yers are taking the current situation as an opportunity.  Yers have been using their severance pay or unemplyoyment aid to simply live it up.  Yers have been quoted saying they are gonna take their severance and backpack through India or they use it to go out and party.  Although these may not be good fiscal decisions, they are definitley enjoying life.

This leads me to the point of this article.  Just because things are a little worse than usual, it doesnt mean everything changes.  Work-life balance is still a vital aspect of a successful life (professionally and personally).

Links:

http://www.msnbc.msn.com/id/29832932/

http://www.msnbc.msn.com/id/29306449/

http://www.msnbc.msn.com/id/29662606/page/2/

Estate Planning Without Anxiety

Copied and Pasted by Jennifer Ng

With the markets in constant turmoil, planning for the here and now seems daunting enough; planning for the after-I-die is even less appealing. Nobody likes talking about death, telling relatives what they’re going to inherit or wading into jargon like terminable interest property. But if you haven’t figured out where you ultimately want your investments and property to go, you won’t control what happens to your savings when you die—and your family will be forced to make hard decisions without your guidance. The stretch between Thanksgiving and New Year’s is a great time for reflection and resolution. Here’s how to get on the ball.

First, take stock of everything you own: Your estate includes not just your personal belongings and investments but also your home, life insurance and retirement savings plan assets, as well as your share of any jointly owned property. You must not only decide where you want each piece to go after you die but also inform your loved ones. If this sounds difficult, start by literally cataloging how you have piled up your most important possessions; connect the work you’ve done with the things in your life that hold the most meaning. Using your life story as a narrative, write down what you’ve accumulated and develop a list of your most significant purchases and investments. Then when you divide up your estate, you will be working from a sense of pride in your accomplishments, not anxiety about death—and your heirs may be fascinated by the details that emerge.

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Toxic Asset Plan

Post By: Dana Sunderlin

President Obama’s administration recently drew up a plan to use capital injections as an incentive, in order to get private investors to buy up a trillion dollars worth of bad assets from those banks who are currently reluctant to give out loans to different consumers and companies. Along with these incentives, private investors would receive federal loans to buy the assets. Treasury Secretary Timothy Geithner feels that it would be “cheaper to provide taxpayer financing than have the government buy the assets outright.”

Many people feel that the toxic asset plan is not the answer for a revival of credit markets. It has been found that this new prospect that taxpayers may need to pay for underperforming assets is making banks reluctant to sell these bad assets off to lower bidders. The plan has made banks afraid to buy and to sell, since the government’s plan for these toxic assets has created additional value for them; “As long as there’s the prospect the federal government will overpay for the toxic assets…these banks would be insane to sell in the private market.” As a result, the plan is not resolving anything.

However, President Obama’s take on the plan is that it is a critical element in the revival of our economy and he is confident that it will work. Treasury officials reportedly have no solid forecast on when these asset purchases will actually begin, although many believe that it will be within a few weeks.

Sources:

http://www.msnbc.msn.com/id/29817617/

http://www.reuters.com/article/newsOne/idUSTRE51B27A20090212

http://www.financialexpress.com/news/us-could-use-capital-injections-for-bad-asset-plan/434279/