If you have read any of my writing, you know I am big on taking care of the basics.  I believe in fundamentals.  That is why I like the movie Karate Kid so much.  Daniel-san was mentored by Mr. Miyagi who helped him learn the fundamentals that carried him a long way.  The same is true when it comes to your finances.  As we approach a new year, I want to talk about some basic planning that a lot of people have not completed.  First on the list would be the following documents:

  • A Will
  • A  Trust
  • Health Care Proxies
  • Durable Power of Attorney

A will provides all of the essential details of who will inherit your property, when and how they will inherit it, and who will be put in charge of settling your final affairs. If you have young children, a will is critical since it specifies who will raise your children if you pass away.

A trust keeps your matters private, avoids costly delays in the distribution of your estate, saves on court costs which can run 2-5% of the gross value of your estate, and helps reduce estate taxes.  More sophisticated trusts can be used to protect assets from lawsuits and divorce once passed on to your family.

Health care proxies are also very important.  They specify who can make medical decisions if you are incapacitated.  They also make certain things explicit such as your wishes, as it relates to life support and being resuscitated.  One thing many families overlook is setting up these documents for their adult children.  If you do not have this document in place and your child is injured when off at college, it will be difficult for you to direct and get information on your child’s medical care and condition.

Durable powers of attorney allow you to make financial decisions for a spouse or loved one if they are incapacitated.

To get the above documents established is not that difficult or time consuming.  A good financial planner will help you with this.  Once these documents are established, we set up an electronic vault for our clients where they can access all their important documents, no matter where they are, as long as they have access to a computer.  Loved ones can also be given access to your electronic vault.  If you have not done so, make it a new year’s resolution to get these documents done.  You and your family will be glad you did.


STANDARD COMPLIANCE DISCLOSURE: Bruce Horowitz is a Registered Representative with/and offers Securities and Advisory Services through Commonwealth Financial Network , Member FINRA/SIPC, a Registered Investment Adviser. CA Insurance License # 0B66129. Innovative Wealth Strategists is located at 6767 Forest Lawn Drive Suite, 120, Los Angeles, CA 90068.  This communication is strictly intended for individuals residing in the states of CA,CO,CT,FL,HI,NV,TN. No offers may be made or accepted from any resident outside these states due to various state regulations and registration requirements regarding investment products and services. Please review our Terms of Use here: http://www.commonwealth.com/termsofuse.html

IMPORTANT NOTE: The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. Due to industry regulations, comments are not permitted on this blog. If you would like to contact the author, please email us at info@iwstrategists.com.