The Society News Kansas City Chapter

Transcription

1 e Vol. 14, No. 7 MARCH 2015 The Society News Kansas City Chapter WEALTH ACCUMULATION STRATEGY FOR 2015 Wednesday, March 11, :30-10:00 am The Hereford House 5001 Town Center Drive Leawood, KS On March 11 our speaker, Alex Knezevich with The Senex Group, will discuss - When should your client consider a pension plan How does a pension plan work Various plan designs Plan funding flexibility Life insurance inclusion and exit strategies Estate tax solutions using qualified plans One hour of CE credit for PACE, CPE, MoCLE, CFP as well as Kansas and Missouri insurance is available. Be sure to bring a guest! Alex Knezevich, CLU, CFP Alex is a Partner and the Chief Financial Officer of The Senex Group, an integrated financial services firm headquartered in Woodland Hills, California. Alex along with his partner, Bruce Gendein, started The Senex Group in The firm specializes in the design and implementation of qualified retirement programs for clients nationwide. For over 30 years Alex has provided design and business consultation services to a variety of clients. The main focus of his practice has been with the problems and challenges unique to small, closely held business owners. Alex has worked with professionals for years custom-designing plans to help their clients save money in the most tax-efficient manner. The registration fee is $35 for guests, with no charge to members. Thanks to our meeting sponsor: 2015 Calendar Put These Dates on Your Calendar All roundtables are 7:30 am - 9:00 am at The Hereford House in Leawood, Kansas.C April 8, 2015 Roundtable Guest Speaker: Trent Green, former KC Chiefs quarterback April 22, 2015 Study Group Location and topic TBD May 13, 2015 Roundtable Annual Meeting Business Practices June 10, 2015 Roundtable Meeting in Lawrence, KS Speaker and Topic TBD Roundtables will resume in September 8826 Santa Fe Drive, Suite 208, Overland Park, KS (913) (913) fax sfsp@sbcglobal.net

2 Minimizing Probate When Setting Up Your Estate What can you do to lessen its impact for your heirs? provided by William Kanaga, CFP, Financial Advisor Probate subtly reduces the value of many estates. It can take more than a year in some cases, and attorney s fees, appraiser s fees and court costs may eat up as much as 5% of a decedent s accumulated assets. 1 What do those fees pay for? In many cases, routine clerical work. Few estates require more than that. Heirs of small, five-figure estates may be allowed to claim property through affidavit, but this convenience isn t extended for larger estates. So how can you exempt more of your assets from probate and its costs? Here are some ideas. Joint Accounts Married couples may hold property as a joint tenancy. Jointly titled property includes a right of survivorship and is not subject to probate. It simply goes to the surviving spouse when one spouse passes. Some states allow a variation called tenancy by the entirety, in which married spouses each own an undivided interest in property with the right of survivorship (they need consent from the other spouse to transfer their ownership interest in the property). A few states allow community property with right of survivorship; assets titled in this way also skip the probate process. 2,3 Joint accounts can still face legal challenges. A potential heir to assets in a jointly held bank account may claim that it is not a true joint account but a convenience account where a second account holder was added just for financial expediency (an adult child able to make deposits and pay bills for a mom or dad with dementia, for example). Also, a joint account with right of survivorship may be found inconsistent with language in a will. 4 POD & TOD Accounts Payable-on-death and transferon-death forms are used to permit easy transfer of bank accounts and securities (and even motor vehicles in a few states). As long as you live, the named beneficiary has no rights to claim the account funds or the security. When you pass away, all that the named beneficiary has to do is bring his or her I.D. and valid proof of the original owner s death to claim the assets or securities.5 Gifts For 2014, the IRS allows you to give up to $14,000 each to as many different people as you like, tax-free. By doing so, you reduce the size of your taxable estate. Please note that gifts over the $14,000 limit may be subject to federal gift tax of up to 40% and count against the lifetime gift tax exclusion, currently set at $5.34 million per individual and $10.68 million per married couple. 6 Revocable Living Trusts In a sense, these estate vehicles allow people to do much of their own probate while living. The grantor the person who establishes the trust funds it while alive with up to 100% of his or her assets, designating the beneficiaries of those assets at his or her death. (A pour-over will can be used to add subsequently accumulated assets; it will be probated, however.) The trust owns assets that the grantor once did, yet the grantor can use these assets while alive. When the grantor dies, the trust becomes irrevocable and its assets are distributed by a successor trustee without having to be probated. The distribution is private (as opposed to the completely public process of probate) and it can save heirs court costs and time. 7 Are there assets probate doesn t touch? Yes, there are all kinds of non-probate assets. The common denominator of a non-probate asset is a beneficiary designation. By law, these assets must pass either to a designated beneficiary or a joint tenant, regardless of what a will states. Examples: jointly titled real property, jointly held bank accounts with right of survivorship, POD and in trust for accounts, any asset held within a revocable or irrevocable trust and most IRA, 401(k) and 403(b) accounts. 4 Make sure to list/update retirement account beneficiaries. When you open a retirement savings account (such as an IRA), you are asked to designate eventual beneficiaries of that account on a form. This beneficiary form stipulates where these assets will go when you die. A beneficiary form commonly takes precedence over a will, because most retirement accounts are legally defined as non-probate assets. 8 continued on page 3 2 The Society News March 2015

3 continued from page 2 Your beneficiary designations need to be reviewed, and they may need to be updated. You don t want your IRA assets, for example, going to someone you no longer trust or love. If you leave a beneficiary form blank, the account or asset in question may simply pass to your estate after you die. It will then be subject to probate, because its distribution will thereby be governed by your will and not a beneficiary designation. With a workplace retirement plan, your spouse is the default beneficiary even if you do leave the beneficiary form blank (unless he or she declines to be the beneficiary of those assets in writing). If you leave the beneficiary form for your IRA blank, the IRA balance may be distributed according to the default provision set by the account custodian (the brokerage firm hosting the IRA account). 9 To learn more about strategies to avoid probate, consult an attorney or a financial professional with solid knowledge of estate planning. William Kanaga is a member of the SFSP-Kansas City Chapter board of directors. He can be reached at or william.kanaga@ceterais. com. Securities and insurance products are offered through Cetera Investment Services LLC, member FINRA/SIPC. Advisory services are offered through Cetera Investment Advisers LLC. Neither firm is affiliated with the financial institution where investment services are offered. Investments are: *Not FDIC Insured * May lose value * Not financial institutional guaranteed * Not a deposit * Not insured by any federal government agency. << This material was prepared by Marketing Pro, Inc., and does not necessarily represent the views of the presenting party, nor their affiliated. This information has been derived from sources believed to be accurate. Please note investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty. This neither a solicitation nor recommendation to purchase or sell any investment or insurance product or service, and should not be relied upon as such. All indices are unmanaged and are not illustrative of any particular investment. Citations 1 - nolo.com/legal-encyclopedia/whyavoid-probate html [9/12/14] 2 - info.legalzoon.com/differencebetween-community-propertuy-rightssurvivorship-vs-joint-tenancy html [9/12/14] 3 - law.cornell.edu/wex/tenancy_by_the_ entirety [9/12/14] 4 - nyparenting.com/stories/ 2013/5/ fp_askattorney_2013_05.html [9/12/14] 5 - nolo.com/legal-encyclopedia/avoidprobate-transfer-on-death-accounts html [9/12/14} deborahjacobs/2013/11/01/the free-giftswhat-you-need-to-know/< com/sites/deborahjacobs/2013/11/01/the %20free-gifts-what-you-need-to-know/> [11/1/13] cacRCRD< nyl/v/index.jsp?vgnextoid=7d792f5a919d2210 a2b3019d cacrcrd> [4/12/12] 8 - nj.com/business/index.ssf/2013/12/ biz_brain_beneficiary_designat.html [12/9/13] 9 - forbes.com/sites/ deborahjacobs/2014/01/03/how-to-leave-yourira-to-those-you-love/ [1/3/14] Trent Green WIll Speak to the Chapter on April 8th We are pleased to announce that Trent Green will be our guest speaker at the Roundtable on April 8th. Be sure to watch your s for further details. Space is limited, so this meeting is limited to members and professionally credentialed guests. Trent Green is a former American football quarterback who played in the National Football League (NFL) for fifteen seasons. He played college football for Indiana University. He was drafted by the San Diego Chargers in the eighth round of the 1993 NFL Draft, and also played for the BC Lions, Washington Redskins, St. Louis Rams, Kansas City Chiefs and Miami Dolphins. He earned a Super Bowl ring with the Rams and was selected to two Pro Bowls with the Chiefs. Since his retirement from playing Green has worked as an NFL color analyst on radio and television. He is currently employed by CBS Sports. During his 15 year NFL career Trent passed for 28,475 yards and 162 touchdowns while compiling a quarterback rating of Trent is currently the chairman of the Trent Green Family Foundation. He and his wife Julie have three children and they reside in the Greater Kansas City Area. 3 The Society News March 2015

4 Our Corporate Sponsors Support your local Sheriff - the President s Circle By Mike O Neill The FSP Kansas City Chapter is celebrating its 81st year and are going into our second year of the President s Circle. We have nine members so far and would love to add several more. The President s Circle is simply a way for our long time members and past chapter leaders to show support/sponsorship for the chapter and for the current chapter President (aka Sheriff). Consider providing a $100 President s Sponsorship to the Chapter and join the President s Circle. James Boldt, CLU, ChFC, LUTCF Jim Boldt and Associates, LLC Bret Guillaume, CFP Mader & Shannon Wealth Management Maris Haster, CLU, FLMI Haster and Associates James Mader, CLU, ChFC Mader & Shannon Wealth Management William Magee, CLU, ChFC, CEBS BMO Retirement Services John Martin, CLU, CAP JMA Group, LLC Matthew McAvoy, CLU, ChFC, MSFS, MS Target Insurance Services, Inc. Michael O Neill, CPA/PFS, CLU, ChFC Mariner Wealth Advisors, LLC Kevin L. Petracek, JD, LL.M., CPA, CFP Parman & Easterday 4 The Society News March 2015

5 Visit the Websites Looking for the a list of chapter events as well as offerings through National? Then go to: We have a calendar of local and national events, as well as copies of newsletters, dues information, and sponsorship information. And, don t forget to check out the many resources available on our national web site from research articles, copies of The Journal, as well as archived copies of audio and webinars. Want to find a member? Go to the directory on either the local web site or national web site. Want to interact with other members, get answers to specific questions? Then join an e-group on the national web site. Take advantage of these and many other membership benefits! org/kansascity BOARD OF DIRECTORS Officers President Jeffrey T. King, MBA (816) jeff.t.king@edwardjones.com Vice President Jason Hannaman, CPA, CEBS (913) jhannaman@mhm-rps.com Secretary Rusty Gallagher (913) rusty.gallagher@marinerwealthadvisors.com Treasurer Donald E. Childers, CLU, ChFC (913) doncinkc@gmail.com Past President Kevin L. Petracek, CFP, JD, LLM, CPA (913) kpetracek@parmanlaw.com Directors James W. Boldt, CLU, ChFC, LUTCF (913) jimboldt@allstate.com William G. Kanaga, CFP, MBA (913) wkanaga@corefirstbank.com Jon Stanfield, J.D. (913) jstanfield@vsrfs.com Edward Zeller, CFP (765) ed@brushkc.com Executive Director Sandra L. Sabanske, MBA (913) sfsp@sbcglobal.net REGISTRATION FORM Name Phone Company Please sign me up for March 11, 2015 Roundtable N/C members, $35 guests Name of Guest ENCLOSED is $, check made payable to SFSP PLEASE CHARGE $ to my Mastercard/Visa/Amex No. Expir date Signature of cardholder Send to: Kansas City Chapter, Society of FSP 8826 Santa Fe Drive, Suite 208, Overland Park, KS or fax to: (913) Alternative Ways to Register: sfsp@sbcglobal.net - Call Go to Calendar page on web site: 5 The Society News March 2015