Small Business Financing at the End of the Brick and Mortar Era… The Christine Chronicles

Hello-

We are settling in to 2018.  Tonight we are headed out for a fun dinner at Marrakech, a Moroccan restaurant in Sacramento, which is a family favorite.  We sit on cushions, eat with our hands (the food is soooooo good) and watch the entertainment (belly dancers). We are having our last hurrah before Daniel and Serena head back to AZ for school and work. Their dog Kona has stayed with us since Thanksgiving so it will be like losing kids and pets at the same time.  Daniel and Serena have been a couple since freshman year in high school so she’s pretty much a part of the family.  Here is a picture of us taken in Pablo Disco-bar (restaurant/bar) in Iceland last month (sans Cameron)!!

 Iceland.2

If you have a small business and need financial guidance, and funding, come check us out. Creating a business entity and understanding tax ramifications can be crucial in your ability to get funding for your business when you need it. Coordinating through your business lawyer is a savvy strategy enabling you to present your business in the best possible light.

Until next time!

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Small Business Financing at the End of the Brick and Mortar Era

As more banks close local branches and eschew brick and mortar growth, small businesses face uncertain times. With fewer branches in which to form trusted financial relationships, business owners often must rely on online banking for everyday needs.

This poses a problem for small business owners who previously benefited from personal relationships with bankers when seeking financing. Although a computer algorithm might not recognize the potential of a small business from an online loan application, personal bankers often can, making local banking branches an important source of funds for small businesses.

So, what can small businesses do to secure vital financing in a world where brick and mortar branches are closing their doors? Where can they turn for personalized financing? Can online banking be trusted?

Entrusting a banking app with the financial livelihood of your business might make small business owners uneasy, especially when facing rejection from online loan applications that only take into consideration hard numbers like credit scores and revenues.

You can offset this disadvantage by working with a skilled advisor—such as a Creative Business Lawyer®—who can help you plan for the future and secure financing for growth on your own terms. A Creative Business Lawyer® can do two things: help you prepare to secure financing from a bank and help keep you in excellent financial shape allowing you to rely less on financing and more on growth.

A Creative Business Lawyer® knows what big banks want to see in an applicant and can help you represent your business as an  attractive candidate for financing. By coordinating your business formation, tax strategy, insurance policies, and financial operations, a Creative Business Lawyer® can ensure your business is a sound investment for any financier.

But securing a small business loan is just the start. To focus on growth, you’ll want to put financial systems in place that minimize your reliance on financing while maximizing the performance of the funding you do obtain.

Securing financial backing for small businesses is harder than ever, but with sound planning, you can beat the odds. If you want to put systems in place to boost your financial fortitude, begin by sitting down with a Creative Business Lawyer®. As your Creative Business Lawyer®, we can establish a sound legal, insurance, financial, and tax system for your business so you can focus on growth and reach your full potential.

This article is a service of Christine Faulkner, Creative Business Lawyer®. We offer a complete spectrum of legal services for businesses and can help you make the wisest choices on how to deal with your business throughout life and in the event of your death. We also offer a LIFT Start-Up Session™ or a LIFT Audit for an ongoing business, which includes a review of all the legal, financial, and tax systems you need for your business. Call us today to schedule.

 

 

 

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Cryptocurrency Risks and Scams and How to Navigate Them — Part 1.. Christine’s Family Wealth Secrets

Happy New Year!

We enjoyed New Years out with friends and were home by midnight… just in time for the firecrackers and our dogs going crazy. Hope yours was great.

Planning for all kind of assets is our goal to protect your loved ones. Crypto currencies are and up and coming mainstream investment, so if this piques your interest check out the article on Bitcoin how tos!

Until next week!

Christine

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Cryptocurrency Risks and Scams and How to Navigate Them — Part 1

It’s no secret that Bitcoin and other brands of cryptocurrency are one of the hottest new investment opportunities.  And if you’re not already invested, you may be considering how to get in, what exactly is the best way to get in, and you should definitely be considering risks and potential scams that are easy to get caught by if you’re not eyes wide open on the issues surrounding cryptocurrency.

Launched in 2009, Bitcoin was the first cryptocurrency, and since then, it has evolved from something only computer geeks and hackers talked about into a global phenomenon that’s transformed how the entire world views money.

Bitcoin is still the most popular—and valuable—digital currency. As of November 2017, a single Bitcoin was worth more than $10,000, with the currency’s total market capitalization at roughly $158 billion.  Bitcoin’s smashing success spawned a legion of other coins, known as “altcoins,” such as Ethereum, Litecoin, and Ripple, and the global market value for all cryptocurrency is currently more than $300 billion.

The huge amounts of money transitioning into the world of cryptocurrency have attracted equally large numbers of investors, looking to tap into this seemingly boundless source of new money. However, because it’s largely unregulated, involves extremely complex technology, and offers significant anonymity, the cryptocurrency market has also garnered the attention of cyber criminals.

Indeed, cryptocurrency’s brief history is filled with stories of people losing major money through hacking and a variety of other traps and scams. As with any new investment opportunity, the key to safety with cryptocurrency is education. While you should always do your own research before investing, here are a few of the most common scams to watch for and how to know whether investing in or using cryptocurrency is right for you.

  1. Shady Exchanges

A cryptocurrency exchange is an online platform for trading one cryptocurrency for another or for “real” currency like the U.S. dollar. These platforms are where you buy in and cash out your cryptocurrency, so they’re essential to the crypto market. Exchanges typically charge a fee for each transaction and are based on current market rates or rates set by sellers/brokers.

Bitcoin’s popularity has caused the number of exchanges to explode, but not all exchanges are trustworthy. In the past, major exchanges have disappeared overnight and taken all of the digital currency with them, while others offer horrible customer service, and/or make getting your money out extremely difficult.

Your best bet is to stick with the largest, most popular exchanges like Coinbase, Kraken, and Bittrex. That said, legitimate smaller exchanges are out there and can be used safely, provided you’ve done your research. Indeed, there are numerous websites that rank and review crypto exchanges for quality, security, and customer service. If the reviews are largely negative, note that it’s difficult to cash out your altcoins, or mention the customer service is exceptionally poor and/or slow, steer clear.

  1. Picking Your Wallet

In order to store cryptocurrency, you’ll want a digital wallet, as that’s the safest way to hold your cryptocurrency. Exchanges are for buying and selling, but not the safest for storing.

Your cryptocurrency wallet doesn’t actually “store” money like a traditional wallet; rather, it stores passcodes, known as keys, that allow you to send and receive digital currency to and from the wallet. There are many different wallets available, but not all of them are totally secure.

Wallets come in two forms: hot and cold. A “hot” wallet stores your cryptocurrency in a location that’s connected to the internet—exchange-based wallets, desktop wallets, and mobile wallets. Because they’re connected to the internet, hot wallets are the most convenient, but that also makes them vulnerable to hacking. A “cold” wallet, conversely, stores your cryptocurrency in a location that’s completely offline. Ironically, the most secure type of wallet for storing digital currency is a cold “paper” wallet.

Paper wallets involve printing out your keys and storing them in a secure location. While paper wallets are the most secure option, if you lose the codes, it’s the same as losing paper currency—you’re screwed, meaning there is no way to recover your investment. Paper wallets are also inconvenient—you have to send your money back to an exchange to use it—which can be a pain if you’re using cryptocurrency on a daily basis.

If you primarily use cryptocurrency as a long-term investment, you should store all of your crypto in a paper wallet. If you’re receiving, spending, or trading frequently, however, you should use both a hot/online and paper/offline wallet. Like real-world wallets, store the money you need for the day in your hot/online wallet, but keep the majority of your funds in a paper/offline wallet for safekeeping.

In all cases, whether you have crypto in a hot wallet, paper wallet, or directly in an exchange, make sure you’ve given the details of where it’s stored and how to access it to the people who need to know in case you’re incapacitated or when you die. Otherwise, it’s completely lost. If the people you love don’t know how to find and access it, it’s the same as it not existing at all. Please talk with us about this if you have any cryptocurrency now that may not have been included in your estate plan, or if you do obtain any in the future. Remember: if your family doesn’t know how to access it, it will be lost if you become incapacitated or when you die.

In addition to safety, investing in cryptocurrency comes with an array of other legal, financial, and tax issues you’ll need to consider. The good news is, as your Personal Family Lawyer we can guide you through these challenges and help you incorporate cryptocurrency investments into your family’s overall financial and estate-planning strategies. Contact us today to get started.

This article is a service of Christine Faulkner, Personal Family Lawyer®. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love.  That’s why we offer a Family Wealth Planning Session, ™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session and mention this article to find out how to get this $750 session at no charge.

 

 

 

 

 

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Ready to Write Your Will? Consider This Before You Go It Alone or Online… Christine’s Family Wealth Secrets

Happy Tuesday:

I hope you had a wonderful holiday.  We had a very low key Christmas, with a few gifts, but mostly sleeping in, hanging out in our PJs and cooking dinner. Our holiday was really about spending time together, and having just returned from Iceland which was the real Christmas gift, I felt little need to spend loads of money for more “stuff”. The gifts I received were special, just what I wanted, and I hope my family feels likewise. We have moved slowly away from the commercial side of the holidays in favor of family experiences.  Here is another shot from Iceland!  If you ever have the chance, go! It is a beautiful place.

Blue Ice

Have you started planning for 2018 and perhaps preparing for new beginnings or simply getting “things” in order? If so, and you don’t have an estate plan, please consider working with an experienced lawyer well versed in planning for you and your family. Doing it yourself can work sometimes, and also be disastrous. On estate planning, you don’t get a “Do Over”, so plan wisely.  A few thoughts on going it alone below and the many good reasons to think again.

Happy Holidays to you and your family!

Christine

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Ready to Write Your Will? Consider This Before You Go It Alone or Online

A last Will and Testament is the most commonly thought of document when it comes to an estate plan. But, really, it’s a very small part of an integrated plan that ensures your family stays out of Court and out of conflict when something happens to you.

Don’t think you can just write your own Will and that will help your family. Instead, consider the reality that trying to do so could actually create far more trouble for them down the road. They need you to get professional support from someone who can help you look at what you own, who you love, what would happen to you, your assets, and everyone you love, if and when something happens to you.

Death is unavoidable. And incapacity may happen before that. Facing these matters head-on leads you (and your loved ones) to having the best life possible. Otherwise, it’s the people you love who get stuck with everything you weren’t willing to take care of now.

Unfortunately, if you go it alone, you may miss important facets of what happens in the event of your incapacity or death. For example, you may think that a Will is sufficient, when what you really need is a Trust to keep your family out of Court.

Or, you may think your kids are adequately protected because you have a Will, but you may really need a full Kids Protection Plan®, and without it your kids could end up in the care of strangers, even if just temporarily. Before you do anything, get educated and empowered to do what’s right.

The right plan for you begins with knowing what you have. Then, being clear on what is necessary to keep your family out of court and conflict and keep your assets out of the State Department of Unclaimed Property. If you are ready to write your Will, that’s great. And, come see us first.

The biggest mistake you can make is not facing the reality of death, the second biggest mistake is facing it alone. If you need help getting started, consult with a Personal Family Lawyer®. We’ll help you through the process so you can make sure your loved ones are protected and your wishes are honored.

This article is a service of Christine Faulkner, Personal Family Lawyer®. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love.  That’s why we offer a Family Wealth Planning Session™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session™ and mention this article to find out how to get this $750 session at no charge.

 

Posted in Asset Protection, Death, Estate Planning, Financial, Guardianship, Incapacity, Parenting, Trusts, Wills | Comments Off on Ready to Write Your Will? Consider This Before You Go It Alone or Online… Christine’s Family Wealth Secrets

The Downsizing Generation: How to Handle a Surplus of Stuff When a Loved One Ages… Christine’s Family Wealth Secrets

Hello.

IcelandAt this very moment, Christine and family are headed home from their short jaunt in Iceland. As expected–it’s called Iceland for a reason!–they’ve all had to endure lots of cold, snow and ice.  Just the thing to put them into the holiday mood upon their return to sunny California.  But I don’t envy  the last minute holiday running around to be done before Christmas next Monday.  Yikes!

 

Today’s article is a timely one, in that many of us will be out searching for just the right gift, or any gift for that matter, for the people who are important to us.  I’m sure you’ve been on the receiving end of one of these “I have to get them something” gifts.  While the thought is appreciated, the item itself might be a candidate for re-gifting next year.  Or even go to a thrift store or garage sale this year.  It’s STUFF.  And we all seem to be collecting a lot of it. Whether for your aging parents or for yourself, today’s article will maybe be the nudge needed to start on the process of deciding what’s important and what’s not.
Wishing you warm and happy Holidays!

Jean Marie & Christine

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The Downsizing Generation: How to Handle a Surplus of Stuff When a Loved One Ages

As the baby boomer generation ages—and downsizes—more and more adult children will be tasked with going through their loved one’s belongings to decide what to do with everything. As more people downsize after retirement, china sets, furniture, heirlooms, and other belongings are often left behind and unwanted.

Traditionally, these items have been passed down to the next generation. But today, the next  generation has different needs, tastes, and wants. As a result, there is a surplus of “stuff” baby boomers don’t need or have room for, and their adult children don’t want. Maybe that includes you.

This is an all too common problem with a few helpful solutions.

The thought of tossing a lifetime of belongings in the trash is more than many can bear, which explains the advent of the senior move management industry. Today, there are a plethora of professionals who can help your loved one go through each item to decide what should be kept, what should be given away, and what should go to charity or donated.

The cost of this professional service can be up to $5,000 for a large estate, but it eases the burden on the adult children and ensures the loved one’s wishes are listened to and honored.

Bear in mind, as the baby boomer generation ages, charities and nonprofits that typically accept used furniture and other belongings are faced with the burden of too much stuff. The dated styles baby boomers preferred during their prime don’t fit the tastes and needs of today’s generation. The current generation views belongings like furniture and dishes as functional and more disposable, better suited to their urban, fast-paced lives where minimalism and portability are more prized than sentimentality and tradition.

Another way to decrease the time and effort it takes to dispose of all your belongings is to be very clear about what you consider to be heirlooms and valuable items by indicating in your will, or in a separate writing ancillary to your will, exactly what’s important to you and what isn’t.

Most importantly, talk to your children or other heirs to see what they want and don’t want. And to make sure they know what’s important to you, and what isn’t. The more you can communicate about this now with your loved one’s, the better.

You may be surprised to discover that most family fights that break up families aren’t over money at all, but over the personal property of Mom and Dad that the kids fight over because there were not clear instructions.

As more baby boomers age and non-profits turn away dated donations, the need for thoughtful estate planning is greater than ever. A comprehensive estate plan can ensure your belongings either go to those who will cherish them or to charities that will benefit from them.

This article is a service of Christine Faulkner, Personal Family Lawyer®. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love.  That’s why we offer a Family Wealth Planning Session,™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love. You can begin by calling our office today to schedule a Family Wealth Planning Session.

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Weathering the Storm: How Families Can Plan for Natural Disasters… Christine’s Family Wealth Secrets

Hello and Happy Monday.

It’s Jean Marie here.  Christine and family are braving the cold and wind in the arctic (ok, nearly arctic) city of Reykjavik in Iceland. I received a text from her today saying a massive wind storm and snow were forecast.  I’m hoping they have some clear weather so there’s an opportunity to see the Northern Lights!  Wouldn’t that be fantastic?  If they do, I’m guessing pictures with be forthcoming.

Today’s article is about disaster preparedness.  It used to be, that natural disasters were unusual occurrences, few and far between.  Now they seem to be coming one right after another.  In August & September we had hurricanes Harvey, Irma and Maria.  In October we had the devastating fires in and around wine country and just when we thought fire season was about over, the terrible Santa Ana driven wildfires in Southern California are causing thousands to evacuate and another massive loss of property.

While nothing can really prepare you for losses such as these, having a plan is your best bet to getting back on your feet as quickly as possible.

Until next week, stay safe and warm,

Jean Marie

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Weathering the Storm: How Families Can Plan for Natural Disasters

Planning for natural disasters is more than just stocking up on canned food and water. In a natural disaster, food and water will keep you alive, but how will you rebuild your life if your home and community are devastated? Here are some simple tips that will help you get back on your feet should disaster strike.

Make sure you have enough insurance. Basic homeowner’s insurance typically won’t cover damage caused by some natural disasters like floods or earthquakes. You might need to purchase additional insurance to cover these types of events. If you’d like an objective review of the types and amounts of insurance you have, contact us, we can help.

Keep a thorough inventory of what you own. Having up to date information on your personal belongings—especially valuables—will make getting them replaced using your insurance claim easier. Pictures of your belongings stored in the cloud is one great way to handle this in advance of any natural disasters.

Create a financial plan. Natural disasters can be financially disastrous as well. You may not be able to return to work and could face the expense of repairing—or rebuilding—your home.

Plan well to ensure you can meet your expenses and make a financial recovery. Account for your insurance deductibles, which can be 10-20% of the total damages and have six month’s salary in savings to cover any gaps in your ability to earn an income.

Protect important information by making digital and hard copies. Put a copy in a fireproof/waterproof safe and give copies to friends or family that reside outside of your area for safekeeping.

It’s also a good idea to work with us. A Personal Family Lawyer® has unique tools that can safeguard your information to make recovering from a natural disaster easier even when you’ve lost everything.

Follow standard safety recommendations. Keep enough non-perishable food and water for your family for 3-5 days. Consider investing in a generator. Build a first-aid kit, and learn CPR as a family.

Keep a comprehensive emergency kit with contact information, survival tools, and a change of clothes for your family members. Designate a meeting place all family members can get to in case your home is wiped out. And talk with your family about what to do in different scenarios.

Families who have someone watching out for them can recover more quickly from natural disasters. Working with us can ensure you have someone waiting to assist you when you face tragedy. We can help you with the legal, financial, and insurance issues you face after a natural disaster.  We can also connect you with outstanding professionals who can help you properly account for losses on your tax return.

We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love.  That’s why we offer a Family Wealth Planning Session,™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love.

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The Ten Richest Families in America and Their Rise to Riches… Christine’s Family Wealth Secrets

Happy Monday:

I read today that Jeff Bezos, CEO of Amazon, is the wealthiest person in the world, topping $100 billion net worth. Having spent my fair share on Amazon, I am not at all surprised. However, will his billions stand the test of time?

We can all learn from America’s wealthiest families/individuals about how to generate and preserve wealth through the generations. It all starts with careful planning and that’s where we can help. The holidays are busy time but once things settle down, if you haven’t put a plan in place consider doing so at the beginning of the new year. Cheers!

Until next time!

Christine

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The Ten Richest Families in America and Their Rise to Riches

Self-made millionaires are not uncommon in the dotcom era, but their fortunes pale in comparison to those of the ten richest families in America. These families weren’t overnight successes, but their fortunes have stood the test of time and are the result of strong family ties and very smart estate planning.

1.Walton ($130 billion)
One of the richest families in the U.S. and the world, the Walton family enterprise is now in its third generation.

2.Koch ($82 billion)
Despite contentious litigation over business interests between Koch’s four sons, the company still stands as the second largest privately owned company in the U.S.

3.Mars ($78 billion)
The Mars family lobbied for the elimination of the estate tax, a key move considering the fortunes that can be nearly cut in half by the 40% estate tax.

4.Cargill-MacMillan ($49 billion)
This family has 14 billionaires on the family tree.

5.Cox ($41 billion)
Although the family got its start in media, diversification has helped the Cox family grow its fortune over the years.

6.S.C. Johnson ($30 billion)
In its fifth generation of family ownership, this multinational brand is now a household name.

7.Pritzker ($29 billion)
The Pritzker family is well known for its use of trusts to avoid taxes before it became common practice. Good planning pays off.
8.Johnson ($28.5 billion)
The Johnson family holds a 49% ownership of this mutual fund company, with the founder’s granddaughter now at the helm as CEO.

9.Hearst ($28 billion)
What started as a newspaper company passed from father to son in 1887 grew into the media conglomerate we know today.

10.Duncan ($21.5 billion)
The Duncan family turned a $10,000 investment in 1968 into its current net worth of $21.5 billion. Not bad for a family enterprise.

These families can help put your own financial trajectory in perspective. Are you on the right track? Are you making the most of your money? Significant wealth isn’t out of reach for even the humblest of beginnings; it just takes good planning.

If you’re ready to create a wealth plan for your family, start by sitting down with us. As your Personal Family Lawyer®, we can help you plan for your family. Our Family Wealth Planning Session™ guides you to protect and preserve what matters most.

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Culture: How a Practice of Karma Can Improve Your Business… The Christine Chronicles

Hello and Happy Friday:

Wow, what a year!  Floods, hurricanes, fires and other weird weather anomalies.  Despite all of the craziness, this has been a good year for me. My youngest son graduated from high school, and gained valuable work experience working for a Miami county commissioner. Daniel continues excelling in school and striving for more – he is taking 23 units this term….. I am impressed!  2017 has been a good year for our firm and I am grateful.

Karma! What goes around comes around! Do you believe that people get what they give?  If so, we’ve selected a couple of great reads coupling Karma and business. Business owners tend to single mindedly focus on the bottom line. Shifting that focus, for a time, by helping other businesses thrive can be a feather in your cap, enhance your community reputation and increase visibility, not to mention make you feel really good.

Wishing you a joyful and fun-filled December 2017!!

Christine

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Culture: How a Practice of Karma Can Improve Your Business

Good business practices like transparency and corporate responsibility can be leveraged to build valuable relationships. But throwing around these buzzwords will only get you so far.

If you really want to see results, what you may want to consider is a practice of karma: the idea that helping others become successful—suppliers, customers, even competitors—is the real key to your success in life as well as in business. It may seem to go against everything you’ve learned about business, such as that it’s necessary to be cutthroat, take out your competitors and get as much as you can while giving as little as possible. The times are changing.

Now, smart business owners know that the key to long-lasting success is turning competitors into collaborators and giving as much as you can to create win/win situations always.

It’s one of the things we are best at, helping you identify the win/win, even when you can’t see it. And, also helping you see where you may be engaging in win/lose tactics without even knowing it because it can be so deeply conditioned.

If you’d like to begin to gather your own evidence for a practice of Karmic business, read the books The Diamond Cutter and Karmic Business, both by Geshe Michael Roach.

Don’t be afraid to take your eyes off the bottom line and focus on how your company can be a force for good, even by helping your competitors. Building a culture that develops healthy karma can be as simple as providing over and above outstanding customer service, taking the time to make your vendor’s lives easier by paying more quickly than required, or even sending referrals to a competitor without an expectation of any return.

Building karma is an important investment of time and energy, and it does pay off. Too many business owners neglect their business relationships and miss out on countless rewards.

Operations and growth are always top priorities for entrepreneurs, but make sure your company culture focuses on building strong relationships, too.

If you want to free up your time and energy to work on your business relationships, begin by sitting down with us. As your Creative Business Lawyer®, we can help you structure your business, so you can focus on growth, potential and all the reasons why you love doing business and show you the opportunities for karmic business that you may be overlooking.

We offer a complete spectrum of legal services for businesses and can help you make the wisest choices on how to deal with your business throughout life and in the event of your death. Call us today to schedule.

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Tax Benefits of Buying a Second Home… Christine’s Family Wealth Secrets

Hello:

Our boys arrived early Thursday morning and we spent a very nice Thanksgiving afternoon in Davis with family and friends. It was wonderful spending time with the boys and have us all together as a family again. Daniel headed out last night to finish out his last few weeks of finals and projects and will be back with us very soon for our Icelandic adventure.

Considering purchasing a second or vacation home? If so, you should become well versed regarding the tax consequences associated with second home ownership. These are not identical to tax deductions you take on your primary residence. Check out our tips on the topic as part of your homework before investing in that vacation dream Home.

Until next time,

Christine

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Tax Benefits of Buying a Second Home

Buying a second home can provide you with a place to relax, unwind, and escape from it all. It can also provide you with substantial savings if you take advantage of these tax benefits of buying a second home.

Mortgage Interest
Mortgage interest paid on up to $1.1 million in debt on your first and second homes is fully deductible. Typically, this rule only applies if you treat your second home as a home and not a rental property. But some mortgage interest may still be deductible if you occasionally rent out your second home. To benefit from this deduction, you must use the property for 14 days or more than 10% of the number of days you rent it out a year, whichever is longer.

Tax-Free Profit
You can take up to $500,000 in profit from the sale of a home tax-free if it is your primary residence and you meet the two-year ownership and use requirement. Typically, you do not get the same tax benefit from the sale of a second home. But people have taken advantage of this rule by converting their second home to their primary residence before the sale, thus reaping the tax-free profit.

But in 2009, Congress added a few more restrictions to limit the amount of tax-free profit you can take from a second home. Now, a portion of the profit from the sale of a second home is taxable. The portion is determined by the ratio of the amount of time after 2008 you treated the residence as a second home or rental property and the amount of time you owned it.

Buying a second home can offer many benefits. But to maximize the value of your investment, work with a lawyer to make sure you are not overlooking any potential legal, insurance, financial, or tax problems or opportunities. You must meet other requirements—such as living in the home for two years before you sell it—to take advantage of some of these tax benefits. A Personal Family Lawyer® can help you ensure you meet the requirements, so you can reap all the benefits of owning a second home.

This article is a service of Christine Faulkner, Personal Family Lawyer®. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love.

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The Pitfalls of DIY Wills: Lessons Learned from a Florida Probate Case… Christine’s Family Wealth Secrets

Happy Thanksgiving week!

We are back from our 60 mile walk in San Diego.  Our group of walkers in San Diego raised $6.5 million to fund research, and breast cancer education.  I have sore feet, a few blisters and much gratitude for the opportunity to contribute in some small way to someday end this disease affecting our family and so many families.  Here are a couple of pictures from our walk!

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Are you a do-it-yourselfer?  If so, then read today’s article, which describes the real life pitfalls of do-it-yourself, online estate planning.  This is one area where you want to get it right, and well, let’s face it, you don’t know what you don’t know.  The intricacies of planning are numerous.  The old adage “you get what you pay for” applies here too. At Cava & Faulkner, we work with you in creating an estate plan that actually works when you need it, and takes care of the people you want, in the way you want, and when you want. That’s money in the bank!!

Until next time,

Christine

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The Pitfalls of DIY Wills: Lessons Learned from a Florida Probate Case

DIY wills are becoming more prevalent as legal services can now be accessed easily online. For better or worse, more and more people are turning to online services to meet their legal needs, maybe even you.

Here’s what you need to know before you decide to create your own will, using an online service, or even a cheap lawyer for that matter.

While these online companies are making legal services more accessible, they’re also doing their customers a dis-service, as evidenced in the recent case of In re: Estate of Aldrich heard in a Florida appeals court.

Ms. Aldrich created her will using a downloaded template from E-Z Legal Forms without the advice and guidance of an estate lawyer. It appears that she wished to leave specific assets to her sister, and then to her brother, if her sister died before her. Her sister did die, after which Ms. Aldrich did not properly update her will.

The assets named in the will went to Ms. Aldrich’s brother, but the template she used did not include a residuary clause, which establishes where unnamed assets should go. There was no way for Ms. Aldrich to know that this was missing from the Will because she was not a lawyer, nor was she truly educated about such matters. Most people are not, nor should they be.

As a result and without a residuary clause, the unnamed assets Ms. Aldrich acquired after the creation of the will passed under Florida’s intestacy laws and into the hands of her nieces, children of another pre-deceased sibling, instead of to her brother, as she seemed to have wanted.

This, of course, after a long, expensive and unnecessary court battle between the nieces and Ms. Aldrich’s brother. 

Services like E-Z Legal Forms do not provide personal legal advice or ongoing legal support. Had Ms. Aldrich worked with an estate lawyer to craft—and then update—her planning, she would have left her brother an inheritance of love, rather than a nightmare of time, money and heartache.

This is an important lesson to learn because people too often create their will without having a lawyer review it and then forget to update it as loved ones pass on and new assets are acquired. In the end, their wishes aren’t honored because they weren’t clearly defined, leaving the matter in the hands of the probate court.

If you’re ready to develop a sound estate plan that will leave a legacy of true love, start by sitting down with one of us. As your Personal Family Lawyer®, we can help you with your legal planning needs. Our Family Wealth Planning Session guides you to protect and preserve what matters most.

We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love.  That’s why we offer a Family Wealth Planning Session,™ during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love.

Posted in Asset Protection, Beneficiaries, Death, Estate Planning, Inheritances, Legacy, Probate, Wills | Comments Off on The Pitfalls of DIY Wills: Lessons Learned from a Florida Probate Case… Christine’s Family Wealth Secrets

Easy Mistakes to Avoid When Passing Assets to Your Child… Christine’s Family Wealth Secrets

Hello-

We have been so busy, Monday blew right by and we did not get our newsletter out. We are heading out tomorrow night for our Komen adventure, which will begin Friday and extend through Sunday. 20 miles a day each day.  Believe it or not, it goes by quickly, and the support the community provides makes this a very fun event. Will post pictures next week.

Carefully crafting your plan to make sure your kids don’t get too much, too soon is an important consideration in the planning process.  Who wants their kids to come into money when they are 18 and blow through it within a year or two?  Most parents never want this outcome. Avoiding this outcome, however requires careful, very thoughtful and  sometimes tricky decision making.  That’s where we come in.  We begin that dialogue in our Family Wealth Planning Session which will open your eyes to the endless possibilities, both good and bad.  We will guide you in avoiding pitfalls and achieving the plan you want, the one that protects your family for the long run.

Until next time,

Christine

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Easy Mistakes to Avoid When Passing Assets to Your Child

Setting up a trust fund for your children can ensure that the money you are leaving behind for them is taken care of, in the way that you want. But your efforts in completing this important, yet somber task can be ruined by making one of these common mistakes.

Leaving Assets Outright to Kids
One of the worst things you can do is to do nothing, which means that whatever you are leaving behind will go to your children outright, unprotected and directly to them when they turn 18. But, worse than that, it means that a Court will decide who handles the assets for them (and whoever is named as their guardian) before they turn 18. And, it’s very likely that those assets will not be used in the way you want. On top of that, if a professional Trustee is appointed, the costs of handling the assets could drain what’s left for your kids, quickly.

Not Carefully Choosing a Trustee
Even parents who do the right thing and set up a trust to hold what’s being left behind for their kids sometimes do not think carefully enough about who the Trustee should be taking care of the assets. Do you want one trustee or a co-trustee who can ensure the funds are well managed? Choosing more than one can provide some accountability for how the funds are used.

Not Properly Protecting Assets Left In Trust
Another mistake parents make when setting up a trust is distributing the assets out of the trust direct to their children at specific ages or stages, instead of holding those assets in a flexible lifetime trust that will protect their kids’ inheritance from future divorces, creditors or accidental lawsuits.

Unfortunately, most lawyers do not understand how to use trusts to establish this kind of vital protection for the inheritance you are leaving behind. And they may even suggest to you that it’s not necessary, if you have a smaller estate. I believe that even when you are leaving behind a small amount of assets, protecting those assets and teaching your children how to grow them (instead of squander them) can be the seed of a huge turning point for many generations to come. It would be my honor to share more about this with you during a Family Wealth Planning Session.

Neglecting to Fix Beneficiary Designations
Lastly, make sure your insurance policies are directed to your trust and not directly to your children. This is a huge mistake we repeatedly see. Naming minors or even young adults as the beneficiaries of insurance and retirement accounts is a sure-fire way to ensure they are not used in the way you want and unnecessarily get stuck in a court process, which you can easily avoid.

A trust can both provide for and protect your children after your death, as well as ensure you are cared for the way you want in the event of your incapacity. If you’re ready to set up an effective plan for your family’s well-being and care, start by sitting down with us.  As your Personal Family Lawyer®, we’ll help you protect, preserve and enhance what matters most.

This article is a service of Christine Faulkner, Personal Family Lawyer®. We don’t just draft documents; we ensure you make informed and empowered decisions about life and death, for yourself and the people you love.  That’s why we offer a Family Wealth Planning Session™, during which you will get more financially organized than you’ve ever been before, and make all the best choices for the people you love.

If you need to create an estate plan give us a call. We’re offering a $50 Amazon gift card to the first 5 people who schedule a Family Wealth Planning Session  by November 30th!  Be sure to mention the title of this article.

Posted in Asset Protection, Beneficiaries, Death, Divorce, Estate Planning, Inheritances, Lawsuits, Trusts | Comments Off on Easy Mistakes to Avoid When Passing Assets to Your Child… Christine’s Family Wealth Secrets