The news is filled with celebrity passings this last week. Ed McMahon lived a long and good life. The other three Michael Jackson, Farrah Fawcett and Billy Mays had not reached conventional “old age”.  This demonstrates the importance of estate planning before a health crisis hits or something sudden happens. By estate planning I mean a short list of items:

  • Do you have a valid, updated will and/or trust for your estate that expresses your wishes? (Moving states, divorce, inheritance are reasons to update.)
  • Do you have sufficient life insurance for your family to continue your current lifestyle? (new baby or life change may call for more insurance)
  • Have you protected your estate financially with Long Term Care Insurance?

Without estate planning you are setting your family up for:

  • Leaving your family without the financial resources necessary to carry on without you.
  • Longer time to settle your estate.
  • More expense in settling estate and less money for your family.
  • Family conflict if your wishes were not in a will or trust. This destroys the family left behind.

Move estate planning to the top of your to-do list so you can live without regret. Also check-in with your parents and siblings to make sure they have taken care of the three questions above. Families are complex and if another member of your family hasn’t taken care of their affairs you may end up dealing with the aftermath.


Yes, it is ok to look. As the end of the second financial quarter hits Wall Street it is time to see where things are at in your portfolio.  I am frequently asked “Should I even look at my investments, 401k, IRA, 529 savings plan or brokerage account?” In general, my advice has been if you don’t need it tomorrow, don’t obsess and look all the time. Instead take action where you can. This may be cutting back spending, changing investments to adjust for your new risk tolerance or saving more to makeup the gap in your account balances.  Here are my Top 10 Reasons to Sneak a Peak.

10. Admit it, you look everyday so why would today be any different?

9. Your mom told you not to look.

8. Finally you’ve made the appointment with a financial advisor and need to know where your 401(k) and IRAs are to prepare.

7. You can’t move forward with your financial plan unless you know where you are today.

6. How else will you know what to complain or brag about at the next BBQ? (Up or down, everyone is talking about the stock market.)

5. It may be time to rebalance your investment portfolio.

4. Good excuse to open that bottle of tequila or wine that you’ve been eyeing to get through the pain.

3. If your risk tolerance has changed because of the market turmoil your retirement investments need to be adjusted accordingly.

2. Relieve stress by printing out your 401(k) or IRA statements and tying them to a bottlerocket on the 4th.

1. You want to retire, it’s time for a new gameplan. Sneak a peak and start today!

In January of this year the Supreme Court put forth a ruling that sets up legal precedence for having your beneficiary paperwork accurate. In Kennedy v. Plan Administrator for the DuPont Savings & Investment Plan the Supreme Court ruled that a savings investment plan administrator accurately paid the ex-wife of a client, because the proper ERISA paperwork was not filled out when he was divorced. This ruling happened even though the ex-wife gave up all rights to retirement accounts in the divorce decree.

This resulted in his daughter and estate not receiving the $402,000 that was in this account. One mistake cost his estate $402,000.

 Read the case , but here is a summary:

  • William Kennedy divorced Liv Kennedy in 1994.
  • Divorce decree stated that Liv Kennedy waived rights to any of William’s retirement accounts and pension.
  • William Kennedy changed the beneficiary paperwork for his pension so that his ex-wife was not the beneficiary, but did not change it  for the DuPont savings and investment plan (SIP) in which he participated.
  • The SIP beneficiary stayed as Liv Kennedy with no contingent beneficiary named.
  • William Kennedy died. His daughter Kari Kennedy, the executor of his estate, contacted the SIP. Per the paperwork they paid it to Liv Kennedy because he had not remarried and no contingent beneficiary was named, leaving Liv (ex-wife) as the only beneficiary.
  • The William Kennedy estate (Kari Kennedy) sued and the case reached the Supreme Court.
  • Supreme Court ruled that the ERISA paperwork is what will determine the beneficiary. The $402,000 is not awarded to Kari Kennedy and the estate.

 One costly mistake considering the actual estate paperwork and divorce decree were evidence of William’s other wishes. Anyone want to do a beneficiary summary for their accounts and make sure things align with your estate wishes? (Or your parents accounts?)


Advisory Services offered through Axiom Advisors, LLC. A registered Investment Advisor Securities offered through Cambridge Investment Research, Inc. a Broker/Dealer member FINRA/SIPC Axiom Advisors, LLC and Cambridge Investment Research, Inc. are not affiliated.

  • Who would you like to have the wealth built over your lifetime – Your spouse, family or nursing home?
  • Do you want to preserve significant assets for your family legacy or charitable giving?
  • Do you want to ensure your spouse is well taken care of should you die first?

Long Term Care Insurance may be an important part of your overall financial and estate plans.

 If you are between the ages of 40 and 80, you need to think about long term care insurance. Especially if you have a family history of Alzheimer’s disease.

Medicaid will cover me is a common thought process of those approaching retirement. Medicaid requires full financial disclosure of assets and has many rules about transferring assets. While the eligibility requirements vary from state-to-state most allow individuals to retain $2,000 in assets and married couples $3,000. A spouse is allowed generally to keep half the combined assets, with a maximum of just over $99,000 in 2006. You are enabled to pay for burial expenses, debt insurances, etc.

Read between the lines on this one, if you or your parents have sizeable assets Medicaid will most likely not be an option. Medicaid was designed to help people with no money. Estate and insurance planning is where your focus needs to be.

If you have trouble falling asleep tonight read up on Medicaid.

U.S. Department of Health and Human Services states that approximately 70 percent of individuals over age 65 will require at least some type of long-term care services during their lifetime. Over 40 percent will need care in a nursing home for some period of time.

The U.S. Department of Health and Human Services calculated the average long-term care costs in 2008 were the following.  

  • $187/day for a semi-private room in a nursing home
  • $209/day for a private room in a nursing home
  • $3,008/month for care in an Assisted Living Facility (for a one-bedroom unit)
  • $29/hour for a Home Health Aide
  • $18/hour for a Homemaker services
  • $59/day for care in an Adult Day Health Care Center

Check out this page to see what the costs are in your area.

Using these numbers for a guideline it costs over $76,000 a year for a private room in a nursing home. If you live in a more expensive area of the country it could cost you upwards of $129,000 a year in New York City, $90,000 in Miami or $82,000 in San Diego. Running the math you can see that a $500,000 or $1 million portfolio can be eaten up very quickly.

Using $76,000 as the cost a $500,000 portfolio can be exhausted in just 6.5 years, while $1 million will be gone in 13 years. When you consider that both spouses may need care that isn’t very long. One of the first things individuals say is that Long Term Care Insurance is expensive. It is expensive if you look at the premium amount. Considering the cost of care carving out a small percentage of the portfolio to protect the remainder is a good idea.

Long Term Care Insurance comes in many flavors and options. I can take you through these; contact me today for brief phone meeting on Long Term Care Insurance.

Advisory Services offered through Axiom Advisors, LLC. A registered Investment Advisor Securities offered through Cambridge Investment Research, Inc. a Broker/Dealer member FINRA/SIPC Axiom Advisors, LLC and Cambridge Investment Research, Inc. are not affiliated.