Questions Your Children Should Have Answers To

“Act as if what you do makes a difference. It does.” – William James

Ok, today’s post might stretch you a bit if you haven’t fostered the ability to speak openly, in love, in your family.

Of course every family *thinks* they’ve done so, but do your children have the answers to the following questions?

Rowel Manasan’s

“Straight Talk” Personal Strategy

The Big Financial Questions Your Children Will Ask

Children may wish to ask their parents about their financial status but worry about being overly intrusive. Or they fear their elders may perceive their questions as motivated by self-interest. They may conclude mistakenly that their parents would prefer to keep their finances private.

However, whether it’s our parents or ourselves, we are all certainly mortal, so planning for the future is always wise. Estate planning is just as critical when we are young as when we get older. And if you think estate planning information is hard for you to pull together, imagine how challenging it would be for someone else who may have to step in for you during a family crisis.

As a parent, if you are willing to share some of this information with your children–especially if one of them is also the executor of the estate–they’ll appreciate having the facts and be more prepared emotionally when the time comes. They’ll know your wishes ultimately anyway, and good communication will lessen any surprises ahead of time. They will benefit from knowing the answers to the following questions.

Do you have enough saved for a comfortable retirement? Even if you try to use a safe withdrawal rate (by age) to make sure you have enough money toward the end of your retirement, few parents manage to correctly time spending their last dime to the day they die. So adult children are justifiably concerned about their parents.

If your spending is under this withdrawal rate, you have more than enough and probably can leave a legacy to your heirs. But if you are over this rate, you may run out of money and have to compromise your standard of living abruptly. It may be uncomfortable, even embarrassing, for parents to share their finances with their children, but grown children often want to know how their parents are doing.

Where are the important documents? The five documents your executor or your children should be able to retrieve quickly are: a will, a living will, a power of attorney, a directory of basic information and the latest end-of-year financial statements.

The directory of information should list the assets of your estate along with account or policy numbers and contact phone numbers. It also helps to indicate your intentions for the distribution of each asset, which will help confirm you have the correct titling and beneficiary designations on every portion of your estate.

You may have structured your will to divide your estate equally among your children. But if you have tried to make it easy for one child to access your bank accounts by adding his or her name, you have overridden your estate plan and left that child joint tenancy with complete rights of survivorship.

Titling and beneficiary designations are legal estate planning actions. It’s best to review them with your legal advisor. Various types of assets are best designated differently in the estate plan. This is not the occasion for do-it-yourself thrift. It is a rare family that has compiled and reviewed a complete list of estate assets: bank accounts, investment accounts, retirement account, real estate holding, life insurance, health savings accounts and so on.

Are there any special bequeaths? Any promises you want kept should be documented. Your good intentions won’t matter if you aren’t around to implement them. If you have promised money to a charity and want that obligation kept, document it specifically. If you have promised to loan a child money, document it. If you have promised to help fund your grandchildren’s college education, document that. Without documentation, none of these promises can be kept if you aren’t around to make the decisions.

Are there plans to remarry? If parents have remarried, intergenerational estate planning is even more critical. Prenuptial agreements and careful estate planning are required in the case of second marriages to avoid disinheriting children or grandchildren from the first marriage. The default is rarely a good option.

Do you have any prepaid funeral arrangements? Do you want to be buried or cremated? Do you have any preferences for a memorial service? Although it may seem macabre to plan your own funeral, a memorial service takes time and thought. It will be that much more special and comforting to your family when it is filled with your favorite music and readings.

Encourage your children’s interest in your estate planning. Most of time, their intentions are honorable. They may simply want to understand your values and therefore your wishes.

And for all of this, just contact me!

To You and Your Family’s Peace of Mind!

I Love Stories Like These…

"Most successful men have not achieved their distinction by having some new talent or opportunity presented to them. They have developed the opportunity that was at hand."
- Bruce Barton

This might offend you, though I’m not trying to ruffle feathers — however, I will be a bit bold here: Could you be focusing too much attention on your family?

Now … far be it from me to suggest that this isn’t the BEST possible investment you could ever make, but are there other young people, causes, ideas which you should be giving thought to supporting?

I was recently told a story about Carol Burnett, and I’ve done my best to faithfully reproduce it here, today, for you — and I think it’s a powerful lesson for those of us with means and abilities which we can pass along.

You’ll see what I mean when you read this story. But as you do, consider:

Giving an additional $X,000 to your family, over and above what you have already set up for them — will it have an impact like this? …

Rowel Manasan’s
"Straight Talk" Personal Strategy
Giving When It Counts, Outside Our Circle
When Carol Burnett was graduating from UCLA’s theater department, the center of the comedy and musical world was New York City. But the grinding poverty she’d known since childhood prevented her from leaving California for the bright lights of Broadway and left her at odds with her career goals.

One night, Burnett and some fellow students were asked to perform a comedy skit at a professor’s party. After the performance, an older man and his wife approached her and asked her what she wanted to do with her life.

She told them about her dream of acting on Broadway, and they asked why she wasn’t doing it already. Burnett explained that she first had to save enough money to get there and establish herself. The man told her to come see him the following week in his office.

Burnett showed up–guarded and skeptical about why the man wanted to see her. He wrote her a check for $1,000 with these stipulations: She must always keep his identity a secret; she must move to New York to give herself the best chance for success; she had to pay the loan back in five years; and finally that she would help others get their start once she became successful.

Burnett accepted the conditions and moved to New York, where her career in musical comedy took off. After five years passed, Burnett sent a check for $1,000 to her benefactor on the exact
anniversary of the loan, and though she had kept all of her promises thus far, she never heard back from him.

However, years later (and after Burnett had now become a household name), she met the couple for lunch and asked whether the gentleman had received her check.

The man answered yes, but didn’t say much else. After lunch, the man’s wife took Burnett aside and told her that her husband was very proud of what Burnett had done, but was too shy and embarrassed to say so.

The wife also said that in all the years that had gone by, her husband had never told one person of his loan to Burnett. He didn’t want anyone to think he was trying to take credit for her success, the wife explained.

Moved, Burnett took the opportunity to kiss her benefactor good-bye and thank him for giving her that all-important start.

Not long after that lunch meeting, she learned that her benefactor passed away. But Burnett continued his largesse by developing young talent on her variety show. And to this day, though she has often recounted this fairy tale-ish turn of events, Burnett has never revealed the identity of the man who launched her career–and her sense of philanthropy.

Now, who will be your next Carol Burnett? Perhaps it’s time we all expand our radar, and find such deserving young people.

Is there any better investment?

And, if you’d like to sit down with me to discuss how such giving can be structured within your estate, I’m happy to create time for that sort of conversation.

I’m right here: (909) 843-6427

To You and Your Family’s Peace of Mind!

Thanks, Mr. Franklin

"Time is free, but it’s priceless. You can’t own it, but you can use it. You can’t keep it, but you can spend it. Once you’ve lost it you can never get it back."
- Harvey Mackay

I suppose I’m on a bit of a Founding Fathers kick.

(Did you know that most of them were lawyers? No wonder they achieved such greatness! Alright, but seriously…)

And one of the most interesting, to me, of the Declaration signers is Mr. Ben Franklin.

As an entrepreneur, the man was brilliant, and as a thinker — well, there are things which I’ve re-learned from him, as I’ve been reading up.

So, if you’ll indulge me, I thought I’d share with you some of the most interesting things about how this great man lived…

Rowel Manasan’s
"Straight Talk" Personal Strategy
The Virtues of Ben Franklin
He was born into a family of 17 children, the son of a poor soap- and candle-maker. When Franklin was a young man, he didn’t practice much of the advice for which he later became famous. But at the age of 20, he decided to change his irresponsible ways and made four resolutions to help guide him through life toward "moral perfection":

1. He would become more frugal so that he could pay money to the people he owed.
2. He resolved to become more honest and truthful in every way he could.
3. He would be as industrious as possible at whatever task was at hand.
4. He vowed to never speak ill of any person, not even if what he might say were true, and to speak of only the good things about the people he knew.

[That last one is especially interesting, and when put into practice -- powerful.]

Franklin believed strongly in self-improvement and worked tirelessly to better himself–mentally, physically, and behaviorally. So, from his four resolutions, Franklin developed 13 virtues to live and perfect during his lifetime.

He numbered the virtues and worked on only one per week. At the end of each week, he would evaluate his progress and then move on to the next virtue. After working on the 13th virtue, he started over again with the first one. Here are his 13 virtues:

1. Temperance. Eat not to dullness; drink not to elevation.
2. Silence. Speak not but what may benefit others or yourself; avoid trifling conversation.
3. Order. Let all your things have their places; let each part of your business have its time.
4. Resolution. Resolve to perform what you ought; perform without fail what you resolve.
5. Frugality. Make no expense but to do good to others or yourself; i.e., waste nothing.
6. Industry. Lose no time; be always employed in something useful; cut off all unnecessary actions.
7. Sincerity. Use no hurtful deceit; think innocently and justly, and, if you speak, speak accordingly.
8. Justice. Wrong none by doing injuries, or omitting the benefits that are your duty.
9. Moderation. Avoid extremes; forbear resenting injuries so much as you think they deserve.
10. Cleanliness. Tolerate no uncleanliness in body, clothes, or habitation.
11. Tranquility. Be not disturbed at trifles, or at accidents common or unavoidable.
12. Chastity. Rarely use venery but for health or offspring, never to dullness, weakness, or the injury of your own or another’s peace or reputation.
13. Humility. Imitate Jesus and Socrates.

Franklin may not have achieved all these goals perfectly (and who of us has?), but what noble goals to be pursued! These are some inspiring and worthy ambitions, for sure.

We’re here to help you pursue your goals for your own life’s legacy however able!

To You and Your Family’s Peace of Mind!

It’s Those Tiny Little Shifts

"Wealthy people get wealthy by not losing money."
-Warren Buffett

Truly, have you ever considered how history shifts on small decisions?

What we celebrate on the 4th was the bravery of men who said [Rowel paraphrase] : "If you’re going to tax me, I need a representative. And, since you won’t give me THAT … well, we’re free anyway. Government doesn’t give us our rights; our Creator does. So, we declare that we are, in fact, independent."

Imagine if, before this point, the King of England had said: "Alright, I’ll allow a representative from each colony a seat in the Parliament." I mean really — it’s not like we wouldn’t have been taxed up the wazoo with representation … the votes would have been something like 250-13 to tax the colonies to high hell!

But at least there would have been representation! [Historians point out that Washington, Adams, Franklin and others, at first, wanted only the same rights as other British subjects. Only until the British remained stubborn did they opt for full independence.]

Instead, the British lack of imagination helped birth the greatest experiment in freedom the world has seen over the last two+ centuries (IMHO).

Now, I have clients who are still fighting a (somewhat) similar battle. And it all can be avoided with another small shift … but it, in fact, can lead to more independence.

Rowel Manasan’s
"Straight Talk" Personal Strategy
A Simple, Daily Task For Independence
Well, the dream of freedom, birthed on the 4th , does still live. But with the current economic environment, we should acknowledge that our government (especially the IRS) is poised to become a deeper, larger influence in our lives. It’s a simple reality, with the deficit and debt burdens now being faced by municipalities.
 
We shouldn’t ignore the power of the IRS in our lives. Solely responsible for collecting federal taxes and imposing related penalties, the IRS (and, really, the tax code) presents one of the most strongly-felt presences in the lives of individuals and business owners.
 
They have unique information resources, legal standing, and roles as a law enforcement agency.  On top of all this, the IRS has the authority to issue legislation and the freedom to make mistakes without consequences (they’re protected from penalties for false tax accusations).
    
So what can you do to protect yourself from the IRS’ power and potential for financial wrath?

Well, if there were a concrete answer for that, the IRS wouldn’t be the intimidating and widely-feared agency it is today.  But there is one thing each of us can do to keep them off our back: Keep Records! (I know, a bit lame … but it’s powerful — and oft-neglected.)
 
Our best defense against audits and false accusations is keeping accurate, detailed records of the flow of all money into and out of our lives. 

Now, depending on your situation, this can be complicated and time-consuming.  Where do you begin?
 
A great place to start is by calling our office; we can help you determine where to focus your record-keeping efforts, and help you develop a strong wall of defense around the "castle" of your finances. 

Generally, the better and more accurate your records, the better your chances are for surviving an audit, of course — with your independence (and your estate) firmly intact.

We’re here to help!