Getting a new job is a significant milestone that marks the beginning of an exciting chapter in your life. As you embark on this journey, you need to get ready and aim for a financially secured future.

The next steps are crucial. You need to establish a solid foundation if you really want to safeguard the fruits of your labor.

Here are several key elements that warrant your attention. By acquiring or reviewing these essentials, you will position yourself for an optimal path to success.

Optimizing your Resources

Whether this is your first job or a transition to a higher income, carefully reviewing your income, expenses, and savings is the first step towards financial success. It’s tempting to envision all the things you can buy with your first paycheck, but it’s crucial to plan for existing expenses and save for future needs, such as retirement. If your income has increased or decreased, a financial professional can provide valuable guidance in optimizing your resources.

Getting Proper Insurance Coverage

With a new job, you may have new financial responsibilities and acquisitions to consider. If your job requires travel or a longer commute, a new car might be necessary, right? Items like that come with a significant cost and need to be adequately insured.

Moreover, if you have dependents who rely on you, it’s important to think about their financial security in the event of your passing. Life insurance can provide the necessary support for your loved ones during such challenging times. Furthermore, disability insurance is worth considering to safeguard your financial well-being and that of your loved ones if you were to experience a disability that affects your ability to work.

By addressing your insurance needs appropriately, you can have peace of mind and protect yourself and your loved ones from unexpected financial burdens.

Create an Income Tax Strategy

Navigating the tax filing process can be overwhelming, especially if you’re unfamiliar with it. If this is your first job, you may encounter elements like federal and state income tax withholding, Medicare deductions, and other similar deductions for the first time.Then at the end of the calendar year, you will be required to file your first federal and state income tax returns.

If it’s a job change, it can put you in a different tax bracket. It’s valuable to determine if you now qualify for any tax credits or deductions, or if it’s more beneficial to itemize your deductions rather than taking the standard deduction.

An experienced tax advisor can guide you through the process, explaining the necessary steps and providing insights into optimizing your tax situation and potentially reducing your overall tax liability.

Securing the Basic Estate Planning Documents

It’s worth noting that estate planning isn’t reserved for the wealthy – it is relevant and beneficial for individuals of all income levels. If you haven’t established an estate plan, now is an opportune moment to develop one tailored to your unique circumstances and goals.

Having a comprehensive estate plan safeguards yourself and your loved ones throughout your lifetime, even during periods of incapacity, and ultimately upon your passing.

If you already have an existing estate plan, a change in employment also serves as a significant catalyst to review and potentially revise your plan. By doing so, you can ensure that it aligns with your current situation, addresses any new considerations that arise from your job change, and remains in line with your long-term objectives.

Set Yourself to Success Today!

We understand the importance of making the most of this exciting chapter in your life. That’s why we’re here to offer our expertise and work alongside your team of financial, tax, or insurance professionals.

Together, we will develop a comprehensive financial and estate plan designed to safeguard the legacy you are building.

Don’t allow ongoing political and financial uncertainties to hold you back from providing tax-free gifts that can benefit your loved ones. Despite the speculation surrounding these matters, you still have the opportunity to make tax-free annual exclusion, medical-payment, and educational gifts.

By taking advantage of these gift options, you can support and contribute to the well-being and education of your loved ones without worrying about any tax implications.

Annual Exclusion Gifts

These are simply gifts of money or property that fall below a certain value. In California, year 2023, the value is set at $17,000 per person. So you can give up to $17,000 to as many people as you want without having to worry about gift taxes. If you’re married, you and your spouse can even double the advantage and gift up to $34,000.

The good news is that the IRS doesn’t consider these gifts as taxable, meaning you don’t have to report them on your federal gift tax return.

However, if your gifts exceed the annual exclusion amount or don’t meet the requirements, you may need to file a gift tax return. There are also special situations where you need to file a gift tax return, so consult with an estate planning attorney to be sure.

Medical Exclusion Gifts

Paying for someone’s medical expenses directly to the provider or insurance company can quality for medical exclusion. The IRS doesn’t consider these payments as gifts for gift tax purposes. This means that in 2023, if you pay for your grandchild’s medical expenses, you can still give them an additional $17,000 without having to worry about filing any gift tax returns.

The types of medical expenses that qualify for this exclusion are generally the same ones that can be deducted for federal income tax purposes.

Also, take note of these important requirements:

• Pay the person or institution that provided the medical care directly. Otherwise, the payment will be seen as a gift to that individual and not as payment for a qualified medical expense.
• The amount you pay must not have already been reimbursed by the individual’s insurance company. If any portion of the expense has been reimbursed, that reimbursed amount is not eligible for the unlimited medical exclusion from the gift tax. Instead, it will be treated as if it was given on the date the individual received the reimbursement.

Educational Exclusion Gifts

Similar to the medical exclusion gift , paying for someone’s educational expenses, such as their college tuition, qualifies for the education exclusion. The IRS does not consider it to be a gift for gift tax purposes.

For the payment to qualify, you also needs to meet 2 critical requirement:

• Pay the institution providing the education rather than to the individual receiving the education.
• The payment must be for tuition only. It does not apply to miscellaneous expenses such as dormitory fees, books, and other similar education-related expenses.

Minimize the Impact on your Tax Liability

Providing financial assistance through these gift options can help you care for your family and minimize tax liability. If you have any inquiries regarding the process of giving monetary or property gifts to your family, please do not hesitate to reach out us. We offer both in-person and virtual consultations to accommodate your needs.

Whether you have inherited your wealth or have built it yourself, you likely want to share this wealth with the next generation and beyond. A concept has been echoed by other people and various cultures, with the underlying notion being that the first generation builds the wealth, the second generation spends the wealth, and the third generation rarely sees any of the wealth. We are committed to crafting estate plans that will disprove those words and provide for many future generations.

How to Protect Your Family Wealth through Estate Planning

While the state have a default plan for distributing your assets after your passing, you have the option to take control through estate planning.

Creating an estate plan is a way to officially outline what you want to happen to your money and property after you pass away. You can specify who will receive them, how much they will receive, and when they will receive it. This is done through a long-term planning tool called a trust, which when properly funded, can even avoid the costly and time-consuming probate process.

To provide further protection for your beneficiaries, you can also establish discretionary trusts that help shield the assets from potential creditors or former spouses, ensuring that the funds are preserved for the intended beneficiaries. You can even write a personal letter addressed to your loved ones to convey your goals and intentions using clear and understandable language to prevent possible conflicts. Lastly, selecting a trustee whom you trust is crucial for achieving your planning objectives. This guarantees the well-being of your beneficiaries while safeguarding the wealth you have accumulated.

If you’re concerned about your wealth being squandered due to financial mismanagment, a lifetime gift can be a smart solution. A lifetime gift in a trust refers to the act of gifting assets or money to beneficiaries during your lifetime. It involves transferring ownership of certain assets to your trust, and allowing you to manage them for the beneficiaries. You can then distribute these assets to the beneficiaries according to the terms and conditions specified in the trust document.

Through lifetime gifting, you can pass on your wealth and values, teach financial responsibility, and promote long-lasting, multigenerational legacy planning.

How to Get Started?

Planning for the future and providing for multiple generations is a meaningful way to leave a lasting impact on your family. To make sure everything is done correctly, it’s important to carefully plan with experienced professionals. If you’re ready to take the next step in your planning, here are the first 2 steps you can take:

1. Meet with your professional advisors:

Financial Planner – Provides you with valuable knowledge and help organize your finances in a way that supports their growth and ensures they are accessible to future generations.

Tax Professional – Offers guidance on the immediate and long-term tax implications of your financial and estate plans, whether you are currently exploring options or have already put plans into action.

Estate Planning Attorney – Capture your wishes and instructions in a legally enforceable document. Reach out to us, and we can guide you through the process.

2. Have a clear conversation with your family

An open and honest discussion about money can be challenging, but it’s crucial to ensure that your intentions are understood and respected. By communicating your plans in advance, your family can play a key role in preserving and passing on the wealth to future generations. When they are aware of and comprehend your wishes, they can better uphold and honor them.

Start Planning for the Future Today!

We are dedicated to supporting families and ensuring a lasting legacy that breaks the cycle of wealth loss in three generations. Schedule a consultation with us today to discuss your aspirations for the future. Together, we can create a comprehensive plan that benefits not only the present but also future generations for years to come.

Shockingly, financial abuse and fraud targeting older individuals cost anywhere from $2.6 billion to $36.5 billion annually, as estimated by the National Council on Aging.

To protect yourself from financial exploitation, it is best to create a comprehensive estate and financial plan that will ensure your protection during your lifetime and the well-being of your loved ones and supported causes in the future.

Building these plans involves a dedicated team comprising professionals like estate planning attorneys, financial advisors, accountants, insurance agents, and even spiritual advisors.

These plans benefit anyone who wants to provide for their loved ones or support a cause even after they’re gone and is not only for the wealthy.

What can a Financial and Estate Planning Team do for you?

1. Keep a close watch on your accounts

Your financial advisor has the ability to closely monitor your accounts for any suspicious activities. If they notice anything unusual, they will notify you right away. Additionally, the firms can temporarily hold funds if they suspect any form of financial exploitation is taking place.

2. Properly execute your documents

Your attorney is the person you can trust to ensure that your wishes are properly documented and legally binding. They will work closely with you to accurately capture your intentions and create a solid plan. If you have concerns about someone potentially taking advantage of your trust, your attorney can recommend additional measures to protect you. Your attorney can also help define specific roles in your estate plan to ensure that your trustee follows your instructions faithfully.

3. Safeguard your plans against undue influence

Throughout your financial and estate planning journey, various changes may arise. It’s crucial to ensure that any modifications made to your estate planning documents or beneficiary designations are not influenced by someone taking advantage of you. If you are unable to make decisions independently, we prioritize protecting the integrity of your documents. Your best interests and intentions will always be the priority.

4. Maintain historical knowledge of your finances

Since you meet with your certified public accountant or tax preparer for a long time at least once a year, they have a good understanding of your financial situation. This puts them in a favorable position to identify any potential issues in your spending habits before they escalate into significant problems. Their expertise and regular check-ins can help you stay on top of your finances.

5. Stress-free bookkeeping services

As people age, they often prefer not to deal with the hassle of managing their checkbook or handling bill payments, especially if their spouse used to take care of these tasks. To address this concern and prevent potential financial abuse, there are reliable advisors who offer bookkeeping services. This will ensure that your bills are paid on time and that someone is closely monitoring your income and expenses. This helps ensure that your financial obligations are met based on your needs and priorities, rather than someone else’s personal desires.

Our dedicated estate planning team is committed to safeguarding your interests and protecting you in every way possible. With our expertise and personalized approach, we can implement various safeguards tailored to your specific needs and concerns.

Don’t hesitate to schedule a meeting with us to learn more about the comprehensive protection we can provide as you age gracefully. Your well-being is our top priority.

Nobody can live forever, and it’s essential to plan for the future. But, even after you’re gone, you can still have a lasting impact on your family’s financial well-being.

In California, one effective way to ensure your loved ones are taken care of is by setting up a trust. This legal tool allows you to allocate specific assets, such as money and property, for the benefit of your family members.

There are different types of trusts to consider, such as a revocable living trust or one included in your last will and testament. With a trust, you can designate someone to manage the assets and outline instructions on how and when those funds should be used.

When it comes to distributing the money and property, there are various options available that suit your preferences and the needs of your loved ones:

1. Outright distribution

You can instruct the trustee to simply distribute all the money and property to your loved one without any restrictions or give them full control to withdraw their share of the trust at any time, no questions asked.

2. Age-based distribution

In your trust terms, you can specify different ages at which your loved one will receive a portion of the money and property. For example, one-third at age thirty, one-half at age forty, and the remaining amount at age fifty.

3. Milestone-based distribution

If you have specific goals or achievements you want your loved one to reach before accessing the funds, you can set milestones. The trustee will distribute a certain percentage or amount once these milestones are met. Some example of milestones are earning a college degree or completing military service.

4. Trustee’s discretion

If you have concerns about how your loved one may handle the money, or if they face potential risks like debts, a troubled marriage, or addiction, you can empower the trustee to decide when and how distributions should be made. This way, the trustee can protect the money and property from creditors and predators while still ensuring your loved one can enjoy its benefits.

We want our clients to have a wonderful and fulfilling retirement. One important step towards that is creating an estate plan that addresses your specific needs and takes away your worries. Our team is here to support you and your loved ones. Get in touch with us soon to find out how we can assist you.

Life insurance is a contract between an individual and an insurance company. In this agreement, the company agrees to pay a predetermined sum of money, known as the death benefit, to the beneficiaries named in the policy upon the insured person’s death. The purpose of this payout is to replace the financial loss that would otherwise impact the beneficiaries due to the insured’s passing.

Most people start thinking about it when they get a full-time job and the human resources representative asks if they want to enroll in the employer’s group life insurance policy. They sign up, name a family member as the beneficiary of their policy, and then never give it another thought. Although it’s a solid starting point, it’s good to shift your perspective and recognize the true significance of life insurance.

There are numerous types of life insurance, and it can be well worth your time to become familiar with the primary varieties and know when to use them.

Which Type of Insurance is Best for Me?

1. Term insurance

Provides a death benefit to the insured’s beneficiaries in case of an untimely death, but only during a specified term or period. Let’s say the policy is for ten years, but the insured individual dies in the eleventh year, no death benefit will be paid to the beneficiaries. Because of this, term insurance is usually more affordable compared to other types of policies.

2. Whole life insurance

Has a fixed premium that remains the same throughout the entire contract and are generally more expensive than term insurances. The reason for this is that the insurance company sets aside a reserve to maintain the level premiums for the insured person’s lifetime. This reserve builds up as a cash value within the policy, which the policy owner can borrow against or cash out if they decide to end the policy before their death.

3. Universal life insurance

The amount of death benefits and cash value depends on various factors such as investments, expenses, and mortality rates that are included in the policy agreement. So, there is a bit of risk involved. This type of policy can offer higher death benefits and cash value over time, but if the underlying investments perform poorly and the cash value isn’t enough to cover expenses and costs, the policy may end.

4. Variable life insurance

It is similar to traditional whole life policies, but it gives the policy owner control over the types of investments underlying the policy. The cash value of the policy can be invested in stocks, bonds, real estate, and money market portfolios, allowing for potential growth. While the policy premiums are generally fixed, the cash value may fluctuate based on the performance of the underlying assets on a daily basis. Additionally, policyholders have the option to borrow a certain percentage of the policy’s cash value if they require cash for a specified period of time.

5. Variable Universal life insurance

A hybrid of variable life and universal life insurance, with many of the most desirable features of both types of insurance built into the contracts:

• flexible premiums
• adjustable death benefits
• control over the types of investments within the policy
• the ability to borrow against the cash value
• partial withdrawal rights

There are other types of unique life insurances that are suitable to different circumstances. Don’t hesitate to seek proper guidance. We can help you identify the right insurance policy to meet your specific need, and coordinate it with your estate plan. Insurance can be complex, but you don’t have to navigate it alone. Contact us today.