Wealth Management

Protecting Your Income & Assets

We insure our homes, our cars, our health, our eyes, our teeth, and in California even against earthquakes. The concept of buying insurance to protect our income and/or assets is a complex one. The moment that we hear the terms “life insurance” or “annuity” an alarm seems to go off and alert us that someone is trying to sell us something that we don’t need. While that may be the case in some circumstances, life insurance and annuities can actually serve a vital role in income and/or asset protection.

We take great care in selecting and purchasing a home and follow it up by insuring that home against potential unforeseen events in the future. Why would we not think about our income and assets the same way? Term life insurance can be an exceptional way to leverage a relatively small amount of premium, or cost, to protect our high income earning years while we are still building sufficient net worth to “self insure.”

In similar fashion, once we reach a point of having enough to retire it might make sense to reposition a portion of our assets into an annuity to protect the principal from future market volatility and guarantee income for life. This is the same thing that a pension accomplishes, only now you get to call (most) of the shots.

Insurance products are complex in nature and require a professional who is licensed not only to sell insurance, but as also operates in a full-time FIDUCIARY capacity for market based investment options. You then have access to the best of both worlds and can compare and contrast the pros and cons of an insured solution versus a non-insured one. When you overlay a comprehensive financial plan to help identify what makes sense for you and why, it is then that you can make a decision whether you need to buy insurance to protect your income and/or your assets.

Tax Strategies

Given our relationships with clients we often become aware of financial situations that can be very helpful in tax planning. We work closely with clients’ CPA’s and tax planning attorneys to take these items into consideration as they likely have an overall impact on performance. Here are a few ways we can help with your tax strategy:

Estate Planning

Possessing estate planning documents does not always mean the estate planning goals are going to be met. We strive to implement a solid plan for our clients so you can avoid unnecessary death tax, unnecessary probate costs, and properly designate beneficiaries for your retirement accounts. We also recognize the importance of the partnership between your financial advisor and estate planning attorney to carry out your goals and objectives successfully.

Keeping Good Records

Another key facet of estate planning is keeping good records, not just of your assets, but also documents that describe your wishes. As an example, your will should outline who you want to inherit your assets after you die, as well as who you’d like to manage your finances or make medical decisions for you in the event that you are incapacitated. These documents are also helpful because they reduce the time and expense of estate settlement, which makes it easier on your heirs.

If you have worked with someone in the past, and you think your estate is properly structured, it may not be. There have been substantial changes in estates laws and taxes in the last couple of years and your plans may no longer accomplish what you think. Also, it’s like that your situation has changed dramatically since you last examined this part of your financial picture.

Establishing a Trust

One tool at your disposal during estate planning is the trust. By establishing a trust, you can ensure that there is money allocated to supporting young children before they are old enough to handle it themselves. A trust is also a key instrument in helping you minimize estate taxes. If you anticipate having assets of at least $100,000, you can use the trust to shield income from these assets from estate taxes. As you can tell, it could be worth a lot to you and your heirs to do a little planning ahead.

To schedule a time to discuss your financial future, send us a note or call us at (888) 401-2083 today!

By contacting us, you may be offered information regarding the purchase of investment and insurance products.

Your investment advisor is not permitted to offer, and no statement contained herein shall constitute tax or legal advice. You should consult a legal or tax professional on any such matters.

info@idawealth.com
(888) 401-2083

Carlsbad, CA (760) 707-5555
Murrieta, CA (951) 290-5020
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