Long-Term Care: What You Need to Know

Long-Term Care: What You Need to Know

There are many misconceptions and misunderstandings about long-term care (LTC), including who needs it and how to pay for it. It’s essential to break down the main components of long-term care insurance to find what is right for you.


What does long-term care mean?

If you’re already on Medicare or researching it, you know that Part A covers in-patient hospitalizations and skilled nursing. You might be wondering why people buy policies to cover LTC if Medicare already pays for it.

But Medicare does not pay for LTC, which is not skilled nursing. It’s home help for someone who can’t perform several of the Activities of Daily Living (ADLs) for themselves: toileting, transferring (for example, from bed to chair), dressing, bathing, feeding, and walking or ambulating. You might also see these referred to as the Basic Activities of Daily Living or BADLs.

Patients can receive LTC in a facility such as a nursing home or their own homes.


Why should I consider setting aside funds to cover long-term care?

According to the US Department of Health and Human Services, if you’re approximately retirement age now, you have a 70% chance of needing some LTC. About 1 in 5 of those who will end up receiving long-term care will need it for more than five years.

Depending on how long you need it, the expenses quickly add up. LTC’s costs range from $3,600 per month for someone who is mostly independent in a facility to about $7,700 in a nursing home. 

Home health care aides cost approximately $21 per hour on average. The average American who needs this help during the day would spend roughly $5,000 a month. Whether in a facility or at home, typically, women need care for a more extended period than men do.

It costs a little bit more than average here in California to receive LTC in a facility. The median cost for help with assisted living is about $4,500 and goes up to over $10,600 in a nursing home.

Some families are willing to self-insure or pay out of pocket should they ever need this kind of assistance. Family members can also provide care, which reduces the cost as well.

However, some people would prefer to be independent for as long as possible. They’d rather hire someone outside the family to help them go to the bathroom or get dressed.

Those who choose to hire for this type of care often want to set aside funds for this purpose. They don’t want to be a burden on their loved ones. 


Long-term care insurance (LTCI)

These policies pay a certain amount for a specified period if a doctor diagnoses the insured as unable to perform two or three ADLs, depending on the policy. 

Unlike life insurance, there is no medical exam for LTCI. However, the companies use questionnaires, and you may respond with answers that disqualify you. For example, they will typically reject people who are already showing symptoms of cognitive issues such as Alzheimer’s and dementia.

Although LTCI has been around here in the US since the 1970s, Americans started to purchase them in the 1980s. The insurers at that time made two significant errors in their pricing.

They didn’t know how fast the cost of health care would accelerate (faster than CPI inflation) and didn’t realize how much longer people would live. These factors led to substantial underpricing on the policies, and in some cases, the insurers even refused to pay for legitimate claims.

As a result, fewer insurance companies are in the market for LTCI today. However, policies still are being sold.

The contracts usually stipulate limits on lifetime benefits paid out, the monthly maximum, and potentially a deductible. They also offer inflation riders for additional fees. Most policies today don’t discriminate between facility or in-home care. 


Ways to purchase LTCI

The original policies were usually use-it-or-lose-it. If you paid for the policy and never required the care, you couldn’t get a refund. Though so much of the population is likely to need it these days, it might not be such an issue for potential buyers. 

Anecdotally the “sweet spot” for purchasing such a policy was around 55 years old. You wouldn’t have too many years of payments if it turned out you didn’t need it, and you were still young enough that some of the disqualifying medical conditions probably hadn’t appeared.

These contracts are still available, though their popularity has dropped sharply. Premiums can undergo rate hikes at any time in the future. 

The insurance company can’t increase the amount you pay just on your policy, but it can raise the premiums on the entire class of people who purchased the same insurance as you. They now have other premium payment options, so you don’t continue to pay for life. 

Rather than take a use-it-or-lose-it policy with the potential for future premium hikes, some LTCI users purchase a hybrid product. These can be life insurance or annuity products that also allow you to use the money for long-term care.

In the hybrid with life insurance contracts, typically, the cost of whatever care you use is deducted from the face amount that’s payable at death. Different companies offer different ways to structure the policy.

When you combine LTCI with an annuity, you usually need to purchase the annuity with a lump sum. There are no premiums for the LTCI, and what you’ll receive is based on how your insurer sets up your contract.

Although the hybrid products are often more expensive than a plain-vanilla life insurance or annuity policy, they can be a good alternative. Especially for someone who suspects they may need the care but is not interested in a stand-alone policy they might not use.

No matter what type of long-term care insurance you buy, make sure that you understand what triggers a claim and what the policy promises to pay. 

If you’re considering LTCI, make sure you check with your company, associations, and groups. Some offer group LTCI plans with relatively attractive premiums.


If you want help determining whether you need to buy some LTCI, give us a call at 619.255.9554 or email us to set up an appointment.


Key Financial Tips for Aspiring Entrepreneurs

Key Financial Tips for Aspiring Entrepreneurs

Many Americans retire from the office job that they held for several years and decide to go into business for themselves, becoming mid life entrepreneurs. Others don’t wait to retire but leave the corporate world to launch. Of course, some people never work for others but engage in entrepreneurship from the very beginning. 

The world of having your own business is quite different from the corporate environment. There are a few things to remember about business finance and personal finance when you leave your regular employer to hang out your shingle.

In honor of National Entrepreneur’s Day, we’re providing this checklist to assist new business owners. It’s an overview to help ensure that your finances stay on track even through the risky business of owning your own business.


Personal Finance


Don’t forget about retirement

Sometimes new entrepreneurs need to tap into their retirement accounts to get their idea off the ground. Or you may assume that you’ll eventually sell your business and fund your later years with the sale.

But the power of investing for retirement lies in the compounding of your annual returns. The longer your money has to grow, the less you need to save. If you get too close to retirement age without having saved enough, you’ll need to come up with a lot more money than if you had started earlier.

Fortunately, there are plenty of employer retirement plans available for business owners, whether you’re a solopreneur or you plan to gather a team. Start socking it away as soon as possible so you can allow the power of compounding to do its work for you.


Emergency fund

Your back up fund is especially helpful when you’re launching a business so that if anything goes wrong in your personal life, you have money to keep you going. No one wants to load up their credit cards unnecessarily. Give yourself some peace of mind by having this cushion in place before you launch.



If you have significant assets like a house or brokerage account, you’ll want to form a business entity for your company. That way, creditors can’t pierce the corporate veil to take your assets to pay off business liabilities. You need to follow the rules of whatever entity you choose to stand as a corporation against unexpected legal confrontations. As an entrepreneur you might take risk with your ideas and creativity, but not with your ownership.

Protecting your assets through a corporate structure is one form of insurance. Naturally, the other is actual insurance products from the relevant companies: umbrella, vehicle, homeowner’s, and life. You might also want to consider long-term care and disability insurance, depending on your situation.


Review for leakage and unnecessary expenses

Regularly sit down with your spouse (if you’re married) and review your expenses. Are you currently paying for subscriptions that you no longer use? Have costs crept up in any particular area? 

Your household should also review your investments regularly and make sure that you’re not spending extra on taxes or unnecessary fees.


Business Finance


The mindset that time is money

When you’re in a corporate job, it’s easy to spend whatever time you need to get the work done and not think about it too much. But when you’re running your own business, you need to account for the time the same way you account for money.

Every hour that you’re working should have a purpose and the same for your staff. You may only need a part-time assistant and not a full-time one, for example.

It would help if you had a reasonable estimate for what an hour of your time costs. That can help you decide where to prioritize your efforts. If your hour is worth $200, should you use it to work on a task that only costs $50? 

That also tells you which clients to go after with your marketing budget: only the ones that can afford your $200/hour services.


Measure the right numbers

When it comes to businesses, too many owners focus on vanity metrics such as revenue. Or base their marketing efforts on social media on “likes” or how many followers their account has.

The business should be making money for you at a certain point, which doesn’t necessarily happen in the first year. That means that you should think of your bottom line as the most critical metric. What profit is your company bringing in? 

What clients are your marketing efforts bringing in? Likes, follows, and the number of followers generally have nothing to do with your bottom line either. Engagement is the name of the game on social media, and visitors to your page or store are what counts in advertising.

If you’re not on top of what social media channels and metrics you should be following, be careful about whom you ask to help you. Make sure they understand that marketing is not about the superficial indicators but how many people are coming to your business to convert into customers.



Not all businesses require business insurance. It depends on the field you’re in and what you’re doing. For example, financial firms usually need at least E&O (errors and omissions) coverage. If you’re not sure, ask the people doing similar work what they have.

Or look at what your potential clients might require. If not everyone in your industry has E&O, for example, but the larger clients all need it, you should probably get coverage too. It is an added expense but may end up being well worth your while.

Launching a business is risky in itself, given that only about half of new businesses survive their 10th year. Give yourself a little peace of mind when you can.


Manage cash flow and expenses

As a business owner, you’ll soon learn that cash is vital. If you’re not invoicing clients quickly enough and not following up on accounts receivable, your life will be more unpleasant than it needs to be. These administrative tasks may not have been a focus for you in your corporate job, but it is incredibly important in your own firm’s early years.

Similarly, keep an eye on expenses. Starting, you should keep your fixed costs as low as possible. Don’t rent an office that you don’t need or hire staff before you need them or can afford to pay for them. 


Want to review your finances before you launch your business? Give us a call at 619.255.9554 or email us to set up an appointment.


Maximize Your Charitable Giving Strategy

Maximize Your Charitable Giving Strategy

You might recall that the Tax Cuts and Jobs Act made it much harder for Americans to get tax breaks on their charitable giving by raising the standard deduction so that fewer people have the opportunity to itemize. Of course, you want to do some good for the community with your charity dollars! But receiving the tax break is nice too.

For National Philanthropy Day, we wanted to give you some ideas for making the most of your charitable gifting this year.


Choosing a charity

More significant dollars make a bigger impact. In other words, if you select just five charities and give them $1,000 each, you’ll make more of an effect than if you sent $100 to 50 charities.

That may mean that you take more time to figure out where you truly want your charitable funds to go and to ensure that the organization is one that you are willing to support. Although many of our clients have a wide variety of philanthropic interests, we encourage you to choose your top two or three and plan to make a difference through them.

Many of the charity rating websites can provide you with a list of the top charities according to the issues that are most important to you.

For tax deduction purposes, your dollars need to go to an organization recognized as a charity. A 501c3 entity can show you their IRS letter granting them charitable tax exemption. You can also find them on the IRS’s lookup tool.


Research the charity to make sure it’s worthwhile

Verify your choices with online sites that provide ratings and information about them. Make sure that your money is going to an entity that values the same things you do.

You can ask the organizations some questions directly as well. What is their mission, and how have they made progress toward it and their goals? Do they have transparency about financials and IRS forms that are readily available on the website?

Watch for costs, primarily operating or administrative. Although not the number one consideration for choosing a charity, costs can help guide your decision. Some charities require a lot more internal support than others, and the organization must staff up to carry out the mission. 

Although the vast majority of charities that you’ll come across are healthy and dedicated to their vision, some scam artists operate in this space. 

If you get an email from an organization you’ve never heard of before, be skeptical. Most of the time, a true charity only emails you when you provided your address to them. And if they’re asking you to send money to a foreign bank or institution – forget it!

Legitimate charities usually don’t send attachments with their emails. They may have pictures that link back to the site, but clicking on an attachment can unleash a virus or other cyber issue into your computer. Delete them. If you’re concerned, you can always look up the phone number on their website and double-check.

You’ll probably see a lot of information come through your social media feeds, too. Remember those scam artists and others, including Russian intelligence, plant bots, and fake profiles. Do your homework first if you see something through social media you want to investigate.

If someone claims to be a victim through email or social media, that’s also likely a scam. You can always search for the charity’s website, look it up on an online rating site, and determine if it’s legitimate.


Don’t forget QCDs

The TCJA also increased the age required to take minimum distributions (sometimes called RMDs or MDRs) from your Traditional or pre-tax retirement accounts. If you’re 72, you need to begin these withdrawals.

However, you can deposit up to $100,000 of the funds at the (legitimate) charity of your choice. This option is known as the Qualified Charitable Distribution or QCD. The distribution must go directly to the charity without making a pit stop at your bank account along the way to avoid disqualification.

As you know, typically, you have to pay taxes on your RMDs. That’s the whole point of having mandated withdrawal requirements. But if you do a QCD directly to the charity instead, you won’t pay taxes on the withdrawal.


Bundle potential deductions

The standard deduction for married couples for the 2020 tax year is $24,800 ($12,400 for singles and married filing separately.) Since the TCJA limited the deductions you can take on items such as mortgage interest and state and local taxes, many taxpayers no longer itemize. Which means they can’t take the itemized deduction for charitable gifts.

However, if you have some unusual deductions this year that could push you over the standard deduction, you might want to accelerate them into 2020 and do some charitable giving while you’re at it. 

For example, the floor to deduct medical costs is 7.5% of your adjusted gross income. If you happen to reach it this year because you’ve had some medical issues, you might exceed the standard deduction. 

Another avenue to consider is bundling your charitable donations into one tax year to help you exceed the deduction threshold, rather than giving smaller amounts annually. If you decide to use a donor-advised fund, you could bundle several years’ worth of giving into one tax year and then portion out the money to your charities over time.

This strategy provides an excellent opportunity to make some substantial gifts and receive your tax break.


Contribution limits

Ordinarily, you would only be able to deduct up to 60% of your adjusted gross income for a cash donation to a qualified organization. However, those limits have been suspended for 2020. The ceiling is still in place for non-cash donations, such as stocks.

Thinking about how best to make your charitable gifts this year? We can help. Just give us a call at 619.255.9554 or email us to set up an appointment.


Dream. Plan. Do.

Platt Wealth Management offers financial plans to answer your important financial questions. Where are you? Where do you want to be? How can you get there? Our four-step financial planning process is designed to be a road map to get you where you want to go while providing flexibility to adapt to changes along the route. We offer stand alone plans or full wealth management plans that include our investment management services. Give us a call today to set up a complimentary review. 619-255-9554.

Save More The Smart Way

Save More The Smart Way

Many of our clients are already saving a significant portion of their incomes for retirement and other financial goals. You may already be maxing out your employee contribution and ensuring that you take full advantage of any available employer match on your 401(k).

Yet, there may be some savings ideas that you haven’t previously considered that could help you boost your plan to achieve your goals. In honor of National Savings Day, here are some additional suggestions.

Add nondeductible contributions to retirement accounts

As a reminder, some clients have access to a Roth option in their employer’s 401(k) plan, which allows them to contribute after-tax money. Others use the tax-deductible Traditional option. The limit for employee contributions to a 401(k) (or similar) account in 2020 is $19,500. There is a $6,500 “catch-up” addition for those 50 years old and over.

However, the total cap on contributions to a defined contribution plan is $57,000, including employee and employer contributions. If your plan allows, you may be able to contribute nondeductible amounts up to the limit. Not all plans will permit these additions, so check with your plan administrator.

As you know, contributions to Traditional IRAs are deductible only up to a certain income under an employer plan. Roth contributions are only permitted up to a specific income level as well. 

However, if you’re above the income limits, you can still make a nondeductible addition to your Traditional IRA. Make sure you keep track of any nondeductible contributions that you add to an IRA that already has pre-tax funds in it. Remember that the $57,000 limit applies only to employer plans. You can make an IRA contribution too.

Why would you add nondeductible funds to a retirement account? They grow tax-deferred until it’s time to withdraw the funds, so you can squeeze out a bit more tax savings by making these kinds of contributions.

Open a Health Savings Account (HSA) with your employer


You’ll need to be using an HSA-qualified medical plan (high deductible) to be able to open the HSA. However, if you don’t use the money you contribute in a given year, you can roll it into the next year. Many accounts will allow you to invest the money, and it grows tax-deferred.

If you make withdrawals before age 65 for nonqualified expenses, you’ll pay taxes and a 20% penalty on the amount you take out. But as long as you use the money for qualifying expenses before age 65, you can take the money penalty-free. After the age of 65, all withdrawals are penalty-free.

Open a 529 plan with yourself as owner and beneficiary

Yes, this is a legitimate way to set up a 529 account. The funds you contribute accumulate tax-deferred. If you use your account for qualified expenses, meaning you could finally take that culinary course or go to golf school, you pay no taxes or penalties on the withdrawal. Otherwise, you’ll owe them on the gains, not on the principal you contributed.

Research credit/debit card rewards

Although credit card rewards may not be as plentiful as they’ve been in years past, you may still be able to find a card where you can earn more points for the places you tend to spend the most.

For example, if you enjoy traveling, look into travel rewards cards that provide bonus points for spending on travel-related items. These often come with additional perks like free airport lounges.

If you spend on entertainment, find a card that rewards you for that. Bear in mind that many of these credit cards come with annual fees, so make sure that you will reap the rewards before taking on a high-fee card.

Shop online for high-interest savings accounts

Here’s another opportunity to squeeze out a little bit more in savings without too much effort. Many online savings accounts offer bonuses and higher interest rates to save with them. Be aware you’re not going to find any reputable bank offering 5% or more while interest rates continue to below. However, you’ll likely see some that offer a slightly better rate than what your brick-and-mortar bank is providing.

As always, make sure you’re not paying any additional fees. They may want you to agree to keep your money in the account for a certain period or require other caveats to guarantee you the higher rate. Make sure you understand what they’re asking for to get the higher rate.

Refinance when attractive

Some of you may have done this already with your mortgage! But if not, consider whether you can negotiate to reduce interest on any of your loans. Yes, it’s theoretically possible that rates could go a bit lower, but probably not significantly lower. 

If you’ve been holding off, consider what rates look like now, and determine whether you should bite the bullet.

Analyze expenses for hidden fees and anything you don’t need anymore

Many accounts in the modern world come with pages and pages of user agreements, and many people skim (or ignore) them before checking the box. However, that means that you may have unexpected fees that are affecting your bank account. They’re unlikely to be large, but even a small fee that recurs monthly for years can add up.

Periodically review your banking and credit card statements. Do all the fees make sense? You might uncover some charges that you don’t know. Investigate and determine whether they’re necessary.

Likewise, are there expenses that you no longer need? For example, if you no longer go to the gym, or have stopped reading a magazine, or got a streaming service and no longer need cable TV, eliminate them.

Go old school to get into a full savings mind set:


Bartering can be a fun way to connect with other people, especially if you have a hobby that you enjoy. You could trade teaching a second language to someone who will give you piano lessons, for example. Or bake bread in exchange for your neighbor’s eggs. There are a lot of ways to be creative here.

It’s also an excellent way to get the word out when launching a new business. You can provide your service for free or as a sample and start amassing positive reviews.

Use your library

No need to spend so much money on books when you can get them for free! Most public libraries are part of a more extensive system. If your local one doesn’t have the book you need, you can request it from another branch and then pick it up on your own.

It’s also an excellent way to cut down on your magazine subscriptions, especially when you have so many you don’t feel you can read them all.


In addition to helping you save money, an additional bonus to gardening is that it can be good exercise and help relieve stress. You’ll find that your homegrown vegetables have much more flavor than the ones you buy at the supermarket.

You can plant flowers too so that you can make beautiful arrangements in your home as well. Your local community college or other community organization probably has a gardening forum that can answer your questions and advise what grows best in your area.

Do preventative maintenance

Rather than wait until things break down, which almost always means a much bigger repair bill, take care of everything as you go. Ensure your home is in good repair to avoid having critters or mold or anything else wear away at the foundations or infrastructure. Maintain your car on a regular schedule.

Care and maintenance also extend to your self! Make sure you’re getting the proper healthcare and exams for your age. Do your best to eat nourishing food and get enough exercise to reduce inflammation, which leads to cardiovascular disease, type 2 diabetes, and others. 

Don’t wait too long to get seen if something seems awry, either mentally or physically. It’s much cheaper (not to mention easier on you) to find that you need medication and get a prescription. Instead of finding out after you have to go to the hospital that you need the medication.

Want to talk about tax-savvy savings accounts? Please give us a call at 619.255.9554 or email us to set up an appointment.

Are you on track for retirement?

Making sure you will be ready for retirement can be overwhelming. Funding your retirement accounts over the years is just one part of your journey to the retirement of your dreams. A Certified Financial PlannerTM can help you navigate the complexities of financial planning. Talk to a Financial Planner>

Dream. Plan. Do.

Platt Wealth Management offers financial plans to answer your important financial questions. Where are you? Where do you want to be? How can you get there? Our four-step financial planning process is designed to be a road map to get you where you want to go while providing flexibility to adapt to changes along the route. We offer stand alone plans or full wealth management plans that include our investment management services. Give us a call today to set up a complimentary review. 619-255-9554.

Your Finances: What You Need To Do First When Your Spouse Dies

Your Finances: What You Need To Do First When Your Spouse Dies


It’s common for the surviving spouse to feel a bit lost upon the death of their partner. You may not have immediate access to all the household assets or know what information you need to put together for the estate.

This time can be very confusing, so it’s essential to feel that you can enlist your financial team. Your financial advisor, CPA, and attorney should work together to help you manage the transition.

Here are the steps you should take to make the process easier for you as you navigate your new phase of life. You can delegate some of these to a trusted relative or friend to give yourself more time to grieve.

1. Death Certificate: Request multiple copies

For many of these steps, you’ll need a death certificate. Make sure you request multiple copies. Some companies may require an actual certificate and not a copy, so ask what they want when contacting them.

These are not necessarily in the exact order you’ll end up taking them, but the more urgent suggestions are listed first.  


2. Locate the will

Hopefully, you and your spouse have both made wills and know where they’re located. If you’re not sure, check where your spouse kept important papers. It could be in a file cabinet or a safe deposit box.

If you’re having difficulty, your estate planning attorney will likely be able to help you since they should have a copy on file.

3. Talk to your estate planning attorney

Every state has different probate requirements, so your lawyer can guide you through the process. “Proving” the will is often the first step taken by the probate court. They’ll also be able to help you with reading the will and settling the estate.

It may take some time for the estate to finally be distributed, depending on how the attorney has set up the estate planning documents. At some point, you may want to revisit your own will, but that doesn’t need to be taken care of right away unless you have an urgent reason for doing so.

If you don’t already have an estate planning attorney, consider asking your financial advisor for a recommendation.


4. Talk to your financial advisor

It would be best if you alerted your advisor about the death as soon as possible. They’ll be able to get the paperwork ready to make the necessary changes. You can discuss with them if they have any recommendations for you regarding your budget, financial plan, or investments. 

They most likely have experience in dealing with widows and widowers, so they can help guide you through some of your decisions.


5. Call the Social Security Administration


You will need to call or visit your local office in person. You may qualify for survivor’s benefits, whether or not your spouse had already begun collecting Social Security retirement payments.

Most likely, you’ll need your spouse’s Social Security number for this, so have it handy when you call or visit.


Are you on track for retirement?

Making sure you will be ready for retirement can be overwhelming. Funding your retirement accounts over the years is just one part of your journey to the retirement of your dreams. A Certified Financial PlannerTM can help you navigate the complexities of financial planning. Talk to a Financial Planner>

6. Call the Veterans Administration if your spouse served in the US armed forces

Similarly, you may be able to claim benefits from the VA, depending on the length of service. There may be some funding that you were not previously aware of, so it’s always a good idea to check with them when you have a military spouse.


7. Collect documents


You’ll find it’s much easier to gather all the necessary items before you begin contacting people. In addition to the will and Social Security information, you’ll want birth, marriage, divorce (if applicable), and death certificates. In addition, find tax returns, banking, credit card, investment account, retirement account, pension plan, and loan statements (including mortgage) as applicable.

It will also help have your house deed, car titles, insurance statements, and bills in one spot.


8. Let employers know

There may be benefits that you can receive as the spouse of a deceased employee. Often you can start your search with the Human Resources department. They’ll be able to advise you if there’s a different number you should call. 

There are several employers you should call, not just the current or most recent company.

Your spouse’s current/most recent employer if retired

Find out what benefits may be available to beneficiaries, as well as the details of the retirement plan or pension. If your family is covered through your spouse’s health insurance, contact them as well to make sure you can continue coverage.

Your employer

Frequently, a spouse’s death is considered a “life event” that may allow you to claim some benefits. Check with your HR to determine whether you are eligible for any additional aid.

Your spouse’s previous employers

You may have access to a pension, retirement account, insurance payout, or other benefit you or your spouse may not have been aware of.


10. Notify insurance companies

It does take some time for life insurance and health insurance companies to process death claims, so you want to do this sooner rather than later. They will likely send you paperwork to fill out. Ask for instructions because the forms aren’t always clear.

For your property and casualty insurance, you’ll need to remove your spouse’s name to put everything in your name. Check policies for auto, homeowners, umbrella, etc.

11. Change titles and beneficiaries on jointly-held property

You’ll need to change everything into your name only, whether it’s the house, banking accounts, credit card accounts, or investment accounts. Your financial advisor can prepare and expedite the paperwork for the accounts that they manage for you.

For accounts in your name, such as pensions and retirement accounts, you may want to change beneficiaries if your spouse is the sole beneficiary with no contingent beneficiaries listed. If you already have contingent beneficiaries designated, this is not an immediate need.

12. Send a letter to the three credit bureaus

You’ll want to get the credit reports for your spouse so that you’re aware of all the credit liabilities. You should advise the bureaus to add the notification that your spouse is deceased so no one can attempt to take credit out in their name. This helps protect you from fraud.

13. Let your tax advisor know

They’ll need to file taxes for your spouse for the year in which s/he died and have the taxes paid. Depending on your situation, this can get tricky, so let them advise you. Because the taxes aren’t due right away, this isn’t an immediate need, but it still should be done in a timely fashion, so they’re not late in filing.

14. Call the financial aid office if you have a student in college

Your child may be eligible for more financial aid or other assistance, so let them know.


15. Cancel your spouse’s subscriptions and memberships


Any gym or club memberships in your spouse’s name should be canceled, so you don’t continue to pay those bills. If you have a joint membership, at some point, you’ll want to investigate what other options are available to you.


16. If your spouse had business interests, let their business attorney know


The lawyer can take charge of any processes that your spouse put in place for this contingency.

Do you need help dealing with the financial issues surrounding the death of your spouse? Please give us a call at 619.255.9554 or email us to set up an appointment.

Dream. Plan. Do.

Platt Wealth Management offers financial plans to answer your important financial questions. Where are you? Where do you want to be? How can you get there? Our four-step financial planning process is designed to be a road map to get you where you want to go while providing flexibility to adapt to changes along the route. We offer stand alone plans or full wealth management plans that include our investment management services. Give us a call today to set up a complimentary review. 619-255-9554.

Is Your Estate Planning Up-to-Date?

Is Your Estate Planning Up-to-Date?

It’s no secret that many Americans put off creating a will — even those who need it most. But one milestone event often triggers a shift in mindset: the arrival of a child or grandchild. Usually, it hits people right before they get on a plane for the first time following the child’s birth: “If the plane crashes, what happens to our children, and how do we make sure they’re taken care of after we’re gone?”

If you have not put your estate plan into place, the answer to that question is that state law dictates who gets your assets, and a court decides who will act as guardian of your minor children. Picture in-laws fighting over custody of your children, assets being misappropriated and mismanaged, and a spendthrift child 18 years in the future, riding off into the sunset in a shiny, new Lamborghini.

A thoughtful and well-constructed estate plan can make all of these worries obsolete. If you put an estate plan in place years ago, it may be time to revisit the documents and revise where needed. If your estate plan was created before the significant tax law changes of 2018, it should be reviewed by an attorney. Here are four essential questions you should be able to answer about your estate plan.

Are estate-planning documents in place and up to date?

For most people, “basic” estate-planning documents include the following:

Will, Revocable Living Trust, Financial Power of Attorney, Health care directives and a living will.



This primary estate-planning document dictates how a your property will be distributed at death. A will also names the individual in charge of managing the property’s distribution — the executor — and includes a nomination of a guardian for any minor children.


Revocable living trust

In many cases, it’s important to have a revocable living trust in addition to a will. For example, in states where probate is unusually expensive or burdensome, a properly funded living trust avoids the expense and delay of a probate proceeding. The living trust becomes the primary estate-planning document, dictating how an individual or couple’s property is distributed upon death and who manages the process (in this case, a trustee).


Financial power of attorney

In a financial power of attorney, an individual names an agent to act on her behalf with respect to her financial matters. The powers granted under a financial power of attorney range from very narrow (i.e., granting the agent power to act on behalf of the individual with respect to a specific transaction) to very broad (i.e., giving the agent the authority to take virtually any action with respect to the individual’s financial matters).


Health care directive and living will

In this document, which has many different names and comes in many different forms, the individual appoints an agent to make health care decisions if she is unable to do so and makes known her end-of-life wishes.

Who should be trustee? Executor? Guardian? Do your clients understand the roles and the differences between them?


These terms can be confusing, but here’s a simple distinction: the trustee/executor is in charge of the “stuff,” and the guardian is in charge of the children. There will be many intersections of the two roles, but each requires a different skillset, meaning different individuals may be needed:


Charged with raising the children if you are unable to do so, caring for the children daily.



In charge of overseeing the gathering of your assets, the payment of taxes and any other final expenses, and then the distribution of the assets to the clients’ beneficiaries. If your estate-planning documents provide for continuing trusts for the children, the trustee will handle the ongoing management and investment of the assets.They will also oversee the distribution of the assets to the children and their guardians.

Some common questions you may have about the two roles are:

Should the trustee/executor and guardian be the same person?


It depends on the client’s situation. The roles require two very different skill sets, but if you have a go-to person you trust to serve in both roles, it may make sense to name the same person. The checks and balances and diversity of perspectives afforded by two different individuals serving in the roles can be beneficial. If you decide to name two different individuals, they’ll need to work together.

Should the trustee/executor and guardian be a family member?


Again, this depends on your situation and relationships. Some things you should keep in mind are the age of the individual you’re considering, as well as where the individual lives (i.e., does the individual live in the same city where the clients are raising their children, or across the country), the individual’s own family composition (i.e., is the individual married, does the individual have his or her own children) and the individual’s personal financial situation.

Is the guardian appointed in the will guaranteed to be the children’s guardian?


No, it is merely a suggestion. The supervising court must officially appoint the guardian but is usually deferential to the parents’ wishes, unless there are extenuating circumstances.

In any case, whether trustee, executor or guardian, it is important to get permission from the person being appointed prior to naming them in the plan.

What if my children can’t handle money?

If the children are minors, an outright disposition of your assets is not appropriate. This means that after your death, continuing trusts will likely be put in place for the children’s benefit, and you need to decide what these trusts will look like. Although estate-planning attorneys will likely have helpful recommendations on how to structure the ongoing trusts for children, some factors you must consider include:

  • The standard of distribution (How does the trustee determine if a distribution is appropriate?)
  • The term of the trusts (Are there mandatory distributions at certain ages, or do the trusts continue for the children’s lifetimes?)
  • The identity of the trustee


Do you have sufficient life insurance?

If the children are minors, an outright disposition of your assets is not appropriate. This means that after your death, continuing trusts will likely be put in place for the children’s benefit, and you need to decide what these trusts will look like. Although estate-planning attorneys will likely have helpful recommendations on how to structure the ongoing trusts for children, some factors you must consider include:

Because of the high cost of raising children today, new parents need to consider purchasing life insurance. There are two basic types:

  • Term insurance – provides coverage for a term of years and pays out a death benefit if the insured dies during the term.

  • Permanent insurance – includes an investment component and is usually structured to pay a death benefit no matter when the insured dies.

One of the primary benefits of insurance is that beneficiaries receive the proceeds free of income tax. Further, if you have substantial net worth and purchase an insurance policy with a significant death benefit, it may make sense to hold the policy in an irrevocable life insurance trust. If structured properly, an irrevocable life insurance trust ensures that any insurance proceeds received by the trust are sheltered from the estate tax.

If you are young and healthy, term insurance is a relatively cheap and effective way to provide an income-tax-free pool of money to provide for surviving children in the case of your premature death.


Start the conversation

A new child or grandchild is a beautiful joy. The new addition to the family usually means an adjustment to estate planning. By working through the four questions above, you’ll take an important step in thinking about your estate plan — and you may rest easier knowing everything is in place.

Are you on track for retirement?

Making sure you will be ready for retirement can be overwhelming. Funding your retirement accounts over the years is just one part of your journey to the retirement of your dreams. A Certified Financial PlannerTM can help you navigate the complexities of financial planning. Talk to a Financial Planner>

Dream. Plan. Do.

Platt Wealth Management offers financial plans to answer your important financial questions. Where are you? Where do you want to be? How can you get there? Our four-step financial planning process is designed to be a road map to get you where you want to go while providing flexibility to adapt to changes along the route. We offer stand alone plans or full wealth management plans that include our investment management services. Give us a call today to set up a complimentary review. 619-255-9554.


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