People ask what is it I do… Are you a pro facebooker ;) Well, I am an expert but at wealth transfer, retirement income, long term care, business investment and insurance, and personal insurance planner to name a few. I have been doing it 26 years and have the trust of the top estate planning attorneys in Denver. These are my referral sources As an example, yesterday… Had a wonderful meeting with a client who has become a very dear friend… I was brought in by the estate planning attorney. As mentioned, most of my referrals come directly from estate planers who trust my services for their clients. I would imagine, a combination of my insanely dynamic personality, my modest brilliance and the wonderful success we have had from the planning we have done has endeared me to them. The best part about my job is making a difference and the bonds we share for having success together. The appreciation we have all had for each other since our relationship began is cherished. In the meeting was the CPA/trustee, the estate referring estate attorney, the daughter trustee, the draft maker extraordinaire and our client. Client is a 76 year old female with three children and a large taxable estate. She has used up most of her tax free lifetime gift exclusion at this point. Two years ago, when the estate tax exclusion was in flux, we used the opportunity to move just over $7m within a partnership and gifting trust for discounting the values and asset protection… With the assets now out of her estate they were placed into a unique investment vehicle which can be used inside of a trust to minimize the taxation on each distribution due to a 60% return of the basis in each distribution. The trust tax bracket is the highest in the tax code and without the right tools to mitigate taxation it can be a minefield to the uninformed. This investment vehicle guarantees a 5% income no matter what happens in the markets for the life of the client and locks in annually against the value in the account. The $7m at 5% is guaranteed to generate $350k come hell of high water worst case. We used the net values of the $350k to purchase $10m of tax free life insurance. We call it theft insurance as the government would basically steal this money from the estate at her passing. So in essence, we are using the governments money to do a large portion of the planning. Taking it back and then some… Through this approach, from day one, we turned what could have been a taxable $7m at death into essentially $17m with $10m non taxable. By creative maneuvering, utilizing a combination of a partnership, a trust, tax free death benefit and guaranteed income producing assets we have created $17m outside of the estate that will from day one be creditor, predator (exs) and estate tax sheltered. As luck would have it two years later we have had a nice return of 20% net of costs on the account values. The investment tool we used are exceptionally well managed conservatively positioned accounts within my most trusted fund family. Each year it locks in the 5% income against the account values which initially was $350,000k but now has locked in at $435,512.00 guaranteed never to be lower. The accounts have distributed $861,094.17 and have a total current value of $7,487,580.35. Thus the total value generated is $8,348,674.62 as of the two year anniversary… This money was sitting inside fully taxable savings accounts two years ago and had the client not taken the steps to put in place proper planning it would still be included in a highly taxable estate and earning less then 1% or $140k by now… In essence we have turned $7,000,000 into $18,000,000 in two years and protected it from the unforeseen and taxation. Boom!! The client has since given me an additional $1.25m to invest for them which I am happy to say has also met with profitable result. So thats the case for the week and insight in to the design work and estate planning I do… Of course the account growth is not guaranteed has been due to strong markets of late but the income and the insurance contracts we used are guaranteed by the underlying insurance companies….
Posted on: Sat, 06 Dec 2014 01:17:21 +0000
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