The Gold Tree Financial Planning Process

Asset allocation isn’t enough. In the financial arena, there are things you can’t control, but there are also those you can. Utilizing the appropriate strategies, a plan can be designed to help make sure the following things happen:

1. Make sure your money goes where you want it to go.

Something as simple as "filling in the blanks" on a beneficiary designation form can have financial ramifications you never imagined. Filling in the blanks on standard beneficiary designation forms can result in your assets going to someone you never intended, even someone you never knew. The problem isn’t rare; it happens often.  Some standard beneficiary designation forms don't ask the right questions to prevent this occurring.

Example 1: If you die, and your spouse remarries, do you have anything in your current plan that would prevent the new spouse from inheriting everything, and then, when they die, leaving it all to their children from a previous marriage?

Example 2: If you leave an inheritance to your daughter and her husband divorces her four years later, there is likely nothing in your current estate plan to prevent him from taking half of her inheritance with him.

Example 3: If your son dies in an auto accident on the way home from your funeral, it is almost certain that nothing in your current estate plan would get those assets to your grandchildren. Them being named as contingent wouldn’t do it. (The only thing it takes to make a contingent beneficiary designation null and void is for your primary beneficiary to be alive when you die.)

2. Assure your income doesn’t run out sooner than expected.

It has been said that the number one concern of retirement age Americans is running out of money before they die. Portfolios can be designed to provide income even if you should live longer than you thought you might.

3. Prevent your estate from going unnecessarily to the government

Many people don’t realize that there is no provision in the IRS Code for an IRA Rollover to a non-spouse beneficiary. When it comes to Tax Planning, how you take money from your accounts can be as important as how you accumulated it. Depending on your circumstances, you may be able to employ specific Non-IRA and IRA Distribution Strategies that, when applicable, result in virtually no income taxes from an investment portfolio for years following retirement*. These strategies aren't included in the securities licensing exam or any continuing education courses we have encountered. Yet, they take advantage of universally available sections of the Tax Code, and, if done properly, would create no problems if your return was selected in a random audit. They are simple, effective, and are on the table for consideration when working with an estate planner who knows them.

4. Learn how to go beyond risk and volatility, by applying the concept of “Money Utility” to your asset allocation strategy.

In today's financial world, setting up a ratio of equities (stocks) to fixed income (bonds) isn’t nearly enough. Investment portfolios can be structured to provide growth potential, retirement income, tax efficiency, wealth transfer benefits, and legacy planning opportunities.

This is where the concept of Money Utility comes in. This means knowing what you want various segments of your assets to do, and how to take advantage of “volatility” knowing the difference between it and “risk”.

With all four of the above-referenced strategies, it is important that your distribution strategy applies “Money Utility” across all the stages of your financial life.

*Subject to IRS eligibility requirements, applicable to Federal taxes only.