Retirement planning is essential to secure your financial future and live a comfortable lifestyle. However, so many struggle with knowing how and what to plan for. What is the average monthly retirement income? At Reef Point, we get this question often as clients try to ascertain how to use a deferred sales trust to supplement retirement income from their 401Ks or pensions.
You invest significant resources into growing your assets, understanding that risk is always involved. However, no matter your risk tolerance level, developing wealth preservation strategies is essential in maintaining financial health now and into the future.
If your family is like many who own a business, you intend to keep it in the family across generations. However, it is also an asset that offers potential security after you pass, regardless of whether the company remains in the family.
An estate tax freeze is an asset management strategy by which you transfer ownership of some of your assets to your family members or other beneficiaries without triggering capital gains tax liability. Actually, the more appropriate term is estate freeze because what you’re doing is “freezing” the value of the transferred assets at their current fair market value. Their future appreciation will be attributed to your beneficiaries, not you. An estate freeze also gets the transferred assets out of your estate, thereby decreasing its value and the estate taxes it will have to pay upon your death.
Horror stories abound about all the ways estate plans can go awry. Here is another one, this time featuring abandonment as the main character.