Planning today for the inevitable, as well as the next generation of your family.

Planning for Generational ChangeNow that the main 2017 tax return push is behind us, the team at Bach, James, Mansour & Company is taking a little time to relax, see loved ones again, and sleep. This is also the time of year that I look for tips and trends to communicate, since preparing tax returns provides us with unique insight into the financial health of our clients. I’ll publish some thoughts and recommendations next month, but there is one key topic I wanted to highlight separately.

Facing the future… on your terms

Many of our clients have accumulated substantial savings, and are comfortably semi- or fully retired on their own terms. You’re now enjoying the benefit of your hard work and smart decisions – nice vacations, golf every day, and plenty of quality time spent with the kids and grandkids. While you’re living the good life today, you also need to ensure that you’re prepared for your future, as well as the future of your family. Unfortunately, I’ve seen too many examples over the last year where lack of planning has caused unnecessary grief and hardship.

It takes more than just sleep to stay healthy, wealthy, and wise

None of us want to think about future health issues and death. While you’re still happy and healthy is the best time to get (and keep) your affairs in order. I understand that every family situation is unique, but here are some general recommendations:

  • Communicate with your kids. Do your children know your financial advisor and CPA? Do they know where your assets, accounts, and even safety deposit boxes are located? There’s a general reticence to share financial details that may influence their behavior, but at least tell your children who to contact in case of a health emergency.
  • Sign a power of attorney. Provide at least one family member (and one backup) with the authority to act on your behalf should you become incapacitated. This person should also be the executor of your will. As you’ve learned in life, someone needs to be in charge at all times.
  • Prepare an advance healthcare directive. You know best how you’d like to be treated later in life when you’re no longer able to make your own decisions. Documenting those decisions and actions now will make it much easier on your loved ones later on.
  • Update wills and beneficiaries. One mistake we see is that beneficiaries listed in financial accounts, like IRAs, haven’t been updated after significant life changes like divorce, death, etc. Please review these every few years. If you’re considering a trustee as executor rather than one of your family members, do you really trust the trustee more than family?
  • Consider long term care insurance. It may seem expensive, but the cost may be nominal compared to the cost of a prolonged illness or disability. Besides saving your assets for your next generation, having a long term care plan generally gives your loved ones more flexibility and more options, such as in-home care vs. a nursing home.

Set up a “team” meeting

Start preparing for the inevitable today so that you and your family keep and enjoy as much of your hard-earned wealth – with as little grief – as possible. Bach, James, Mansour & company does not sell financial or insurance products, so we can take an unbiased look at your specific financial situation, assess your current and future financial health, and recommend the steps (and experts) necessary to meet that goal. If you already have a “team” of financial advisors and attorneys, let’s get together to review and document your plans. Finally, please share this information with a child or children.

Neal Bach, CPA