Archive for Finance
The Entrepreneur and Their Personal Legal Advisor – It’s Not Just About Lawsuits Anymore
Posted by: | CommentsStarting and running your own business requires you to be something of a gambler.
Regardless of how much you plan, nothing is certain except that at least some of the million and one things you think can go wrong, will.
To balance your penchant for taking a few risks with the need to ensure the success of your business, you need to plan, get and follow good advice and, above all, don’t give up at the first sign of trouble.
These few steps will help you reduce or control at least some of your risk:
1. Plan for the Worst Possible Scenario
Most entrepreneurs are optimists. They have to be or they would never think of going out on their own. You go into business to succeed, not to fail. But knowing that there is that small, ever so slight possibility that you could fail will prevent you from being complacent and making poor decisions. A little fear will keep you sharp. Plan exactly what you would do if the worst happened and you’ll know what to do if it does.
2. Don’t Do It Alone
If a carpenter measures twice and cuts once, make sure you think about your business decisions at least twice before jumping into anything. Avoid being impulsive and analyze before you act. If you’re not the analytical sort, find a trusted advisor who is. Remember, a system of checks and balances isn’t just for the government. Run your ideas or decisions by that trusted advisor and get another perspective. Sometimes you’re just too close to the decision to make a good one.
3. Decide On and Develop Your Niche
In your heart of hearts you know what you’re good at, what you really care about and why you started this business to begin with. Play to those strengths. Don’t take every project that walks through the door just to have the work. You’ll be much more successful and happier if you stick with what you know.
4. Increased Revenue Gets You There Every Time
If you are struggling, focus all your energy on increasing revenue and making sales instead of focusing tremendous energy on cutting costs. Increasing revenue will allow you to hire the right team members to support your growth and keep you headed in a forward momentum. If you focus heavily on cutting costs, it’s very easy to get stuck.
5. Get the Right Kind of Business Insurance
While there is a school of thought out there that says insurance is for pessimists, do yourself a favor and get insurance. And get the right kind of insurance for your business. It will reduce your personal risk and protect you from claims from the people you have to deal with on a daily basis. Lawsuits can come from anywhere so keep that in mind when considering the type of insurance you need.
Reduce both your risk of sleepless nights and making costly mistakes by finding the right advisor to help you with the decisions you need to make your business a profitable one. Hire a personal legal advisor. Each of these 5 steps will be much easier and you will feel better about them if you talk them over with someone who can guide you in the right direction. And remember, your legal advisor is a business person, too. They can speak to your problems not only from a legal viewpoint but from experience. They understand exactly what you need to do to be a success.
If you’re an independent entrepreneur or you’re considering taking the leap to business ownership, call us today to schedule your comprehensive LIFT™ (legal, insurance, financial and tax) Foundation Audit. As your personal legal advisors we will identify any holes in the foundation of your business and what you need to do to fix them. Normally, this session is $1250, but if you mention this article and we still have room on our calendar this month, we will waive that fee.
Gifting to Nieces and Nephews – What You Don’t Know Can Hurt You (and Them)
Posted by: | CommentsGifting to Nieces and Nephews –
What You Don’t Know Can Hurt You (and Them)
Picture this scenario…
You’ve worked hard, saved and managed to accumulate some wealth.
You’re not a robber baron by any means but you’re comfortable. Your siblings haven’t fared as well and you want to make sure that their children have the benefit of a solid higher education. With no children of your own, it seems the right thing to do.
So you set up 529 college education savings plans for your nieces and nephews, make them the beneficiaries, and mention everything in your will.
And life goes on…
You don’t give it another thought beyond making regular contributions. You move to another state. You divorce.
All the things that happen in the normal course of living.
You know you need to change the beneficiary of your estate and name another executor (both are still your former spouse) but you never really get around to it.
And then the unthinkable happens. You die unexpectedly, with no time to make those changes you sincerely intended to make.
This is where things can quickly fall apart for those nieces and nephews you so wanted to take care of.
To make sure your wishes are carried out exactly as you intended, take these steps now to protect those 529 college education savings plans:
- 1. Name One or Both of the Child’s Parents as Participant or Owner
If you name your niece or nephew as the “beneficiary” of the 529 plan as a gift, you must add one or both of the child’s parents as the Participant or Owner. This gives them actual control over the 529 account. They can even change the beneficiary. If the child’s parent is not listed as an owner or participant, the plan will be considered part of the estate (which would then belong to your former spouse in this instance). Your niece or nephew would need the executor (again, your former spouse) to essentially turn the plan over to them in writing. And the executor and beneficiary of your estate would be well within their legal rights to refuse. Is that a risk you really want to take?
- 2. Update Your Will
I know you’ve heard this at least a thousand times but I’ll say it again because it is critically important in situations like this. If you undergo any kind of lifestyle change (i.e., divorce, death of a spouse or child, become incapacitated, move to another state, etc.), take the time required to have your will updated. This kind of situation happens all the time. The former spouse, as both executor and beneficiary, controls the 529 college savings funds because of a failure to properly set up the funds. If you’re going to the trouble of setting up a 529 fund and make regular contributions to it, take the necessary steps to ensure that money is used for what you intended.
- 3. Don’t Leave Assets or Insurance Outright to Your Nieces or Nephews
If you leave either assets or insurance directly to your nieces or nephews and they are minors at the time of your death, their parents will have to go to court to be named as guardians to gain access to these assets. Needless to say, that just adds another layer of complexity and more expense to the process.
- 4. Have Your Estate Planning and Financial Documents Thoroughly Reviewed
When you update your will, make sure that all your estate planning documents are reviewed, cross-referenced and do not contradict each other. Also, make sure that the person or persons you’ve named as beneficiaries and owners of your accounts are coordinated with your estate planning documents and that all your documentation supports your ultimate goals and objectives.
I can’t emphasize enough how important it is to have current estate planning documents. And this is especially true if you have 529 college education savings plans set aside for nieces, nephews, great-nieces or nephews, etc.
If you have started a 529 plan or would like to and would like an expert opinion on how a plan like this should be handled, call us at 818-905-6088 to schedule your Family Wealth Planning Session today. We can identify what needs to be done to ensure that you have the appropriate language in the plan to make sure that the money goes exactly where you intended. Our Family Wealth Planning Session is normally $750, but this month I’ve made space for the next two people who mention this article to have a complete planning session with me at no charge. Call today and mention this article or visit or website at http://www.estplan.com to request a call back.
Protecting Your Children’s Nest Egg
Posted by: | CommentsParents often set up trusts as a way to ensure their assets reach their children and successive generations without being diminished by courts costs and taxes. When leaving assets to a child, parents will be faced with some choices on how to handle or set up their children’s future inheritance.
Should they leave them to the children outright (no longer held in the trust), how much and when should the children receive the assets and will their inheritance be protected from future creditors are amongst some of the questions a parent must ask. Read More→
Keep The Change And Get $4,000 In Bonuses
Posted by: | CommentsChanges in our lives can bring a wealth of opportunity or surprising disappointment.
We can anticipate some changes, like getting married or the birth of a child, and other times, Change just struts in and makes itself at home without warning.
It’s easy to evaluate and plan for those big or significant changes that we know are going to happen: what they entail, when they will happen, how they will affect our lives, and how we can be better prepared for them when they do. Read More→
Is Your Business Putting Your Personal Assets At Risk?
Posted by: | CommentsAll professionals are aware of the challenges of running their business amidst a barrage of lawsuits. The number of lawsuits filed each year against physicians and small businesses is staggering and has reached over 15 million. That works out to one new lawsuit every two seconds! Or one lawsuit filed for every 12 adults in America. This is truly a large number of lawsuits.
Professional small business owners are at risk of losing their business assets, savings, and livelihood with one malpractice case. Steps can be taken to minimize the threat of these lawsuits and insulate assets from liability. Read More→
When Real Estate is owned by a parent and child
Posted by: | CommentsLast week, I had a client ask me what the best way to vest title when purchasing property with a child. This is an ever recurring question as to what is the best way to hold title between a parent and child. Property is often acquired with a child due to a joint investment the parent or child can’t qualify for a loan, or the parent or child wishes to gift an interest to the other.
Before I can answer this question, it’s helpful to understand the various ways two parties can hold title to property. Read More→
If You Need Help, Don’t Be Afraid To Ask
Posted by: | CommentsWith Rosh Hashana, dance classes and tryouts for “The Nutcracker” (not me; my daughter, Taylor!), and my daughter Hailey’s IEP, it was such a busy week! I didn’t want to let the opportunity go by, though, without getting some timely information to you about what is on everyone’s mind, what with the bailout, the dire predictions about Wall Street, and all the things associated with it.
Has Wall Street or the economy got you down? Well, don’t let it. The economy will always bounce back. Wallstreet is cyclical, and if you look at the patterns over time, it has always gone up. Yours will too. Read More→
