<p>What have you all done with your non-retirement assets regarding estate planning? Are you using living trusts or just using a will, or gasp, going intestate? And how did you select the executor - I’m told it’s not a good idea if the person is out-of-state, and that’s what happens quite often with kids. If the husband/wife both die in the same accident, you have issues if you had gone with the spouse.</p>
<p>I have spouse as the primary executor, my brother as our secondary and my niece as the third layer executor. We all live in HI with no plans to move. I’m not sure where our kids will be living. We will be putting the title for the non-retirement assets into the trust, but haven’t done so yet. shhhh!</p>
<p>All assets in revocable trust package. 3 kids = 1 POA, 1 Executor, 1 Health Care proxy; each is the next it line on one and third in line on the other. Executors are in age order and must have attained age 35 to assume duties; if not of age, duty diverts to one of my siblings (I am widowed).</p>
<p>DocT, If 401K conversions are like IRA conversions, the amount converted to a Roth is ordinary income. How do you shelter ordinary income? You either need a tax loss, a tax credit or a deduction. There is no magic there. I would be very leery of a self styled “expert” selling tax shelters to qualified investors. It can take years for the IRS to discover and disallow schemes at which time the seller could be long gone and you could face back taxes plus interest plus penalties… or worse. I think it often makes sense to convert over a period of time, but always try to figure out your tax bracket and convert an amount that brings you up to, but not into, the next bracket. If you are already making enough money to be in the highest bracket it might not make sense to convert at all. I have converted small amounts of my traditional IRA to Roth IRAs in years when I had very low income so there was very little tax due. One year I actually needed the taxable income to take advantage of an energy tax credit when we bought new HVAC equipment. </p>
<p>We have a will, with spouse as primary executor. Oldest child (in state) is alternate executor. Our situation is pretty simple, with many beneficiary designations defined at the asset. </p>
<p>We have a dynasty trust, revocable trusts for everything else, and a will that distributes the tangible goods to spouse if alive and then kids and puts everything else into the revocable trusts. Plus an irrevocable life insurance trust. Spouses as trustees of revocable trusts and will, with successor trustees. Non-family members trustees of dynasty trust.</p>
<p>We have a dynasty trust with a trustee and successor trustees who are not part of the family. We have a revocable trust with spouses as successor trustees (and then subsequent successors). Then there is a will which gives tangible stuff to wife/kids.</p>
<p>Any thoughts on how to deal with assets in blended families? I have 2 kids and my husband has 1. My sons’ father is not well off. My husband’s ex is very well off. I need to change my beneficiary situation soon, and I’m not sure what to do. If it matters, my husband and I do not share money, credit cards, etc. We both help pay for many things, but our assets, except for our home and furniture, and the savings we use for college, are pretty much separate. That said, I don’t want to cause any problems by how I handle this. </p>
<p>@1214mom, I’m in a blended family (I have 4 kids, 2 with my current wife, 2 from previously). I have wrestled with the question of equalizing the kids’ total inheritance (my wife has considerably more assets than my ex does) versus dividing my assets equally. Even if I gave every penny to my 2 older kids, they’d have less inheritance than my two younger kids. </p>
<p>My inclination has been to divide my assets equally, on the theory that I love them all equally. I do have one child who might need some extra help in life, but I think the siblings would pitch in, and I’m not sure that it will even be necessary (knock wood, things seem to be going better lately, salt thrown over the shoulder). </p>
<p>We also handle our long-term assets separately. Since I gave up my outside-the-house job early, my wife pays for just about everything, but we’ve agreed that I can add to my accounts, so I’m still accumulating. </p>
<p>I have seen the “Joe needs it more than Sam” story play out in my wife’s family, even though the parents are still alive. They are also very nosy about what the ex will have for the kids. I find the whole thing distasteful, and we are very clearly independent of the power plays that seem inevitably to arise when someone is handing out money unequally. </p>
<p>Blended families can be tricky. I’d be fine if my dad’s money went to his wife of 6 years. She is much younger, so it has crossed my mind that I don’t want his money to go to her and then her family (she has no kids) instead of my kids. But I would never want to see her in need herself if he passes first. </p>
<p>I think you can’t play the “who needs it more” scenario with kids, unless there’s a situation where there is a kid with serious special needs, or something dire. The kids that get less will always feel slighted, no matter the reason. Honestly, even if I have a kid who is a billionaire and another who is poor, they get equal shares (though I sincerely doubt that will happen, I think they will both be very successful). . I’ve told them that if there is one penny left over, they need to either give it away, throw it away, or cut it in half. Absolutely no favoritism, totally equal. And if there is plenty for all, why not? I would hate to have a kid feel less cared for than the other. Plus, you never know how someone’s life is going to play out.</p>
<p>I agree with Busdriver: “you never know how someone’s life is going to play out.” Soooo true. </p>
<p>We are grateful my MIL, FIL, and SisIL all left everything to BIL and H equally, so it was easy and left them on the best of terms. It’s easy enough for one brother to refuse a portion of an inheritance (which H did), like a portion of the business but not good to second guess how the future will play out. Hidden resentments can easily surface when distributions are unequal. </p>
<p>H is the only inlaw of my family and only one of his sibs not to have a professional or graduate degree. He’s also loved his job more than most and ended up retiring with a much more generous pension than he had expected. It literally took an act of Congess (that many despaired of ever happening) and several reorganizations to get him a healthy pension, much to his and our surprise. </p>
<p>FYI - Today NOLA website (legal/finance books) has a THANK14 coupon code good for 40% off.
<a href=“Legal Forms, Contracts, Law Books & Software - Nolo”>http://www.nolo.com/products/</a></p>
<p>I ordered the “Work Less, Live More” book recommended her last month. It will probably be for DH for Christmas, or maybe his 60th bday in May. List price is $17.99, normally discounted to $14.99… $8.99 with code. Media shipping was $5. </p>
<p>I agree about not causing any negative feelings between siblings and relatives if things get split w/o equality. </p>
<p>Always interesting how more distant relatives think they can hone in on someone’s positive financial picture. Especially when someone stays single - how they decide to leave their estate. Also when they have been generous (almost to a fault) to the siblings/nieces/nephews, then get re-married and the relatives can no longer ‘mooch’. </p>
<p>My one sibling has done very well financially, and is the only one w/o biological children/grandchildren. He felt a bit uncomfortable being included in the inheritance split. However probably has figured out he can always include nieces/nephews in his will. His two single step-children currently are being well-provided for (financially helped) as mid-aged adults, age 45+, and will sadly go through whatever money they are given. He actually has in the past included an ex-stepdau who now has children - not sure if she is still in his will.</p>
<p>Thanks. I like hearing different perspectives. In our case there are no “our” kids. He has 1, I have 2. (Yes, they are all our kids, just trying to say they are only related by our marriage). The one thing I do not want to happen is for my current husband to get married if I were to die first, and then have my kids not get money and have it go to the new wife’s kids. Just to be clear, I would hope that he would get remarried, just not shift my “wealth” to new family. We definitely need to work on estate planning, including figuring out how to deal with our federal pensions. </p>
<p>I agree with you @1214mom - it gets a bit complicated when that scenario happens.</p>
<p>My BIL had no biologic children, and my sis has just one. BIL’s extended family acted like he was one to be giving out his time and money - they have extensively mooched and he allowed it - of course he got a lot of emotional strokes; he had debt he should’t have had (sis helped pay it off). These relatives of his have been forward enough to ask BIL and sis if her dau was going to get everything/his ‘estate’, and they answer ‘yup’.</p>
<p>Lack of money as well as having substantial assets can draw out the best and the worst in people.</p>
<p>Well, my best friend (57) is retiring in March and moving 4 hours away with 2 mountain passes between us and my good friend at work (68) is retiring in a month. They both are good planners and have pensions and savings. I (59) am now officially the longest one there in the department and quite possibly in most of the departments. Many people I don’t even know who yet are retiring in the next month…it is getting lonely…I am reading 2 retirement books (self help) that do not involve financial planning.</p>
<p>Happy Thanksgiving to you all! As we dream of the retirements we’d like to have, may we also have an opportunity to be thankful for the good things we have in our lives at the moment. </p>
<p>I am thankful that DH (55) and I(52) retired 6 months ago and will be celebrating T’giving in our new home (5 hours and a world away from our previous home of 32 years). DH’s job was so stressful. It was really taking a toll on him. After 6 months of retirement, he’s a different guy, almost like he’s ten years younger. If you can swing it, I highly recommend it. Happy Thanksgiving all.</p>