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BET on Yourself

BET on Yourself

October 02, 2023

When it comes to your financial legacy, BET on yourself. BET is an acronym representing three areas to consider.

Beneficiaries. Review your bank, retirement, and investment accounts. Are they titled in a way to ensure your assets pass to your beneficiaries? How do you know? Reach out to your bank, 401(k) custodian, and/or brokerage firm and ask: what happens to my accounts in the event of my death? Verify you have beneficiaries listed on your accounts.

Estate. Have you heard the phrase “avoid probate!” The truth is no one avoids probate. Probate is the name of the process the state uses to ensure that property of a decedent is distributed as intended (by will) or according to state law (without a will or intestate). Talk with an estate attorney about property you own, especially if blended families are involved. Does it make sense for you to create a trust? What may happen if you disinherit a relative?

Taxes. Did you know that when you name a trust as beneficiary of your IRA, it may require the account be distributed within 5 years and taxed at a higher rate? Did you know that if you retitle your property (i.e., bank or brokerage accounts, property) to give it to someone else before you die, you may be causing a taxable event or disrupting what may be a favorable tax situation? Prior to making changes to your accounts, talk with your tax or financial professional about what you want to accomplish.

Although laws governing taxes and estates may change, you are responsible for creating your financial legacy. Conversations with your tax professional, estate attorney, and financial professional may ensure you avoid actions that result in unintended unfavorable outcomes.

Wendolyn Forbes is a CERTIFIED FINANCIAL PLANNER™ with Wealth Transition Finance, A Member of Advisory Services Network, LLC. Wendolyn is a fee-only financial planner and member of the National Association of Personal Financial Advisors (NAPFA).

CFP Board owns the marks CFP®, CERTIFIED FINANCIAL PLANNER™, and CFP® (with plaque design) in the U.S.

This material is provided as a courtesy and for educational purposes only. Advisory Services Network, LLC does not provide tax advice. The tax information contained herein is general and is not exhaustive by nature. Federal and state laws are complex and constantly changing. Consult your own legal or tax professional for information concerning your individual situation.

Originally published in the October 2023 issue of Positively Haywood by Vicinitus.