Military Officer - May 2006 - (Page 36)

financialforum Transfer Plans In 1789, Ben Franklin said, “In this world, nothing is certain but death and taxes.” As you manage wealth preservation and transfer, truer words do not exist. By Phil Dyer, CFP T Member Benefits From MOAA ■ Did you know that members receive a 25percent discount for using an MOAA-referred lawyer? Go to www.moaa .org, and click on Member Offers under Services for more details. he key to ensuring your hardearned wealth passes according to your desires is to develop a coherent plan before you need it and review it every other year. With the “greatest generation” and baby boomers estimated to pass on $41 trillion by 2052 (Social Welfare Research Institute, 1999), proper planning is critical. Your personal plan will depend on your speciﬁc situation and desires, but there are several steps common to the development of a wealth transfer and preservation plan. ■ Current asset inventory: Identify all ﬁnancial assets, where they are held, and who the current beneﬁciaries are (if applicable), and gather key information in one place. If assets are scattered over a dozen or more ﬁnancial institutions, strongly consider consolidating holdings to two or three institutions for ease of management, provided this can be accomplished while minimizing fees and taxes. Be sure to organize the inventory so it is easily understandable to someone else. ■ Current asset needs/restructuring: Determine which assets you will need to live comfortably; which can be targeted for lifetime, family, or charitable giving; and how you ultimately will dispose of assets such as the family home, highly appreciated investments, and retirement plans. Reallocate your assets to meet any shortor long-term spending needs and goals. Once you have your inventory, assemble your wealth preservation and transfer team. This should include: ■ Estate planning and elder law attorneys: An estate planning attorney drafts the documents to support a plan. These include wills, advance health care directives, revocable living trusts, and other documents. This is especially important if you have not updated your estate-planning documents in the past ﬁve years. Federal estate tax laws and many state laws have changed signiﬁcantly in the past three to ﬁve years, so older documents may not be optimal. Although most military retirees will not qualify for state assistance under Medicaid, some might, and elder law attorneys can provide invaluable guidance on long term care, asset preservation, and end-of-life issues. ■ Financial planner: A ﬁnancial planner can assist you in arranging assets that will support your short- and long-term needs, determining which are best spent during life or held into the estate, and gauging whether long term care insurance makes sense based on your ﬁnancial situation. ■ Your family: Making your family aware of your intent might avoid future resentment, particularly if there will be an uneven distribution of assets. Family members who have responsibilities under the plan as executors, trustees, or other decision makers should be briefed in advance. MO — Former Army Capt. Phil Dyer, CFP, is deputy director for ﬁnancial education, Beneﬁts Information. For ﬁnancial advice, members can contact Garrett Planning Network at (866) MOAA-GPN (662-2476) or www.moaa.org/ garrett, or visit www.moaa.org/ﬁnancialcenter for other resources. PHOTO: GREG SCHALER 36 MILITARY OFFICER M AY 2 0 0 6 http://www.moaa.org http://www.moaa.org http://www.moaa.org/garrett http://www.moaa.org/garrett http://www.moaa.org/financialcenter

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Military Officer - May 2006 Contents From the Editor President's Page Your Views MOAA Directory Rapid Fire Washington Scene Financial Forum Ask the Doctor Chapter Activities Raising Iraq Dogfight Fun Caring For Our Own Pages of History Information Exchange MOAA Scholarship Donors Member Books Advertising Index MOAA Calendar Sounding Taps Encore

Military Officer - May 2006

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