The Million Dollar Annuity

Two years ago I referred a retired couple who had come to me for estate planning to financial advisor Mario Govic, who is now out of Sarasota, Florida. The couple had about $3 million invested in more than 16 different financial institutions, qualified and nonqualified accounts, with ownership and beneficiary designations twisted and turned, and a portfolio of holdings which made no sense at all. Their RMD’s were causing a severely negative tax hit, and positions were bought and sold without regard to basis and tax liabilities. After a month of intensive work, Mario consolidated their holdings into a handful of annuities with various GMIB and GMWB riders and non-qualified accounts, and in general straightened the client’s nightmare portfolio into a well-managed and tax efficient retirement plan.

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Different Types of Damages that Can Be Claimed in Personal Injury Lawsuits

Personal injury lawsuits strive to obtain financial compensation, also called damages, for the plaintiff in order to make up for the injuries and other effects he suffered from his accident. Three types of damages are available: economic, non-economic, and punitive.

Economic damages compensate for costs that can be objectively expressed in financial terms. This can include medical bills, lost wages after the accident, or the cost of hiring someone to help around the house. In addition to what you have already paid, you can also receive compensation for future costs. If you will require continuing medical treatment, you can receive damages to pay for it. If you will be unable to work, or unable to work as much as you could before your injury, you can also receive damages to compensate for this. Plaintiffs will usually receive full compensation for these losses, even if that requires very large awards.

Non-economic damages compensate for subjective losses that cannot be verified in monetary terms, like pain and suffering, loss of enjoyment of life, disfigurement, loss of companionship, and other factors that affect quality of life. In some states, awards for non-economic losses are capped, usually at less than one million dollars, in an effort to prevent plaintiffs from becoming wealthy from these awards. This idea of tort reform is controversial, and not all states have adopted it. Continue reading Different Types of Damages that Can Be Claimed in Personal Injury Lawsuits

Life Annuities

Thanks to Prudential for inviting me to a presentation (and dinner!) by Prudential Regional Vice-President Gary Woodward on Prudential’s HD (Highest Daily) Lifetime 7 Plus Variable Annuity product. As you well know, the primary purpose of a variable annuity is as a mechanism to save money during a person’s working years which can then be used to draw upon as an income stream during retirement. It’s not available as a lump sum, obviously.

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Financial Planning

I had a breakfast meeting this morning with Alli Joseph, creator of Seventh Generation Stories, who shared with me her vision as to the meaning of the word “legacy.” Customarily, in the financial professions and in the estate planning field, we generally think of “leaving a legacy” in financial terms, or otherwise with respect to property and inheritance. When used in this context we believe you should consider forming a domestic asset trust to protect your financial treasures.

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Online Wills & The Ethical Dilemma

My friend in the insurance business sent me last week an article from the Wall Street Journal which generally came out favorably towards online Will preparation systems. Usually I would have gone on a rant as to the ignorance of people who believe they can get an estate plan done over the internet for $15, but at that particular moment I instead found myself in an ethical dilemma.

The reason is that by and large will and trust preparation is simply not a good profit center in my practice for couples in the $100,000 – $300,000 income bracket, and with assets less than than a few million dollars (including the house and 401(k)’s). This is because those folks, generally couples in their 30′s to 50′s, simply are not going to (by and large) pay $3,500 or more (depending on complexity) to have their Wills, Trusts, and Advanced Directives drafted. But I know from experience that such a couple is going to come into my office for a first interview and talk to me for an hour or more about their assets and issues and ask a ton of questions; and then I’ll draft their documents, and the couple will want to come in again and review and ask more questions and make changes, and then I’ll have to draft the documents over again; perhaps another telephone conversation, and another draft of the corrected documents, and then the execution ceremony, where things perhaps need to get changed again.

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Estate Planning

An excellent way for your clients to save money (perhaps a lot of money) on their estate planning engagement is to have much of the preliminary work done ahead of time. In other words, much of the cost of having an estate plan prepared is caused by the time and effort it takes for the attorney to educate the client about the options available, gather and sort the various documents which are needed to develop the plan, and then discuss your clients’ goals and objectives. Many run estate planning practices by Continue reading Estate Planning

Immigration is Demographically Inevitable

With so much debate on illegal immigration, we rarely discuss legal immigration – our laws and policies – and how they can be used to lessen the more than 11 million undocumented immigrants in the United States.  Here to shed light on one of those policies, in what he calls the tyranny of priority dates is Gary Endelman.   But first, Gary discusses why immigration in the United States is ‘demographically’ inevitable.  Endelman is the In-house Immigration Counsel for BP America Inc., handling all U.S. immigration law for the BP group of companies through­out the world since 1995.


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