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5 End-Of-Year Financial and Estate Planning Tips for 2017



The year 2017 is coming close to an end, which makes now the perfect time to review your estate plan, as well as, plan for 2018's financial management goals.  By taking the time now, you have the opportunity to plan ahead before being swept up in the Holiday hustle and bustle.  


An annual review of your estate plan and financial management should be included in your yearly checklist. Just as you would have an annual check-up with the doctor or dentist, reviewing your estate plan and financial plan can determine your financial health for the beginning of 2018.  Here are 5 End-of-Year Financial and Estate Planning Tips for 2017:


Tip #1: Asses Your current Plan


This is a good time to review your current plan. Months or years may have passed since you created or last reviewed your estate or financial plans. By reviewing your plan now, you can assess areas where you would like to improve until the end of the year, while you still have the time, and review the areas where you would like to improve for next year.  You can't make a plan unless you know where you've been, which, on the flip side, it allows you to have a better understanding of your personal goals for the future.



Tip #2: Budget


Creating a budget and sticking with it can be difficult. Things happen - the car needs a new windshield, kids need new clothes, a pipe broke and now new flooring is required - but creating a budget and recording all of your spending will give you a good idea on your current expenditures and which areas of your finances you may desire to improve. Think of budgeting as a tool of awareness. You may be surprised on how much a daily latte costs you, and the amount spent on small items, such as a daily coffee, when added up over the course of a year. The average American spends $14 per week or over $1,100 per year just on coffee alone. Along with budgeting, it allows you to review if you are able to take your dream vacation or give more to your children or grandchildren now. You may want to set up an instrument that gives you the ability, while you can now, to save for a child's college tuition or maybe a house upon graduation.  Setting reasonable budgeting expectations allows you to have peace of mind that you have the resources to protect your family now and in the future.


Tip #3:  Review/Update Financial Plan


When do you see yourself retiring? Does your financial plan match your goals? Speaking with a financial advisor can help create a financial plan that will match your short and long-term goals. When you have a financial plan, it's easier to make financial decisions and have realistic expectations. A financial advisor can assist you in developing the right plan that will match your overall goals, while providing reassurance to make beneficial investments.


Tip #4: Think about Charitable Giving


If you plan on making charitable donations, then all donations must happen before December 31st to apply for a charitable donation deduction for 2017. Generally, you can claim 30 to 50 percent of charitable contributions from your adjusted gross income depending on the type of donation and charity. If your donations exceed the threshold for the current tax year, then it may be able to be carried over to the subsequent year. Now, before you start your charitable giving, there are rules that must be applied to claim deductions on your tax return:


·      Donating cash or property: the promise to donate does not count. Make sure to keep some form of record, such as a bank statement or receipt, to have confirmation that you indeed donated during the fiscal year. Your records must show the name of the charity, the date of your contribution and the amount you donated. In some cases, the charitable organization will provide a written statement of your contribution. If you donate non-cash items, then make sure to have your property appraised to determine the value of the property you donated.

·      You must donate to a qualified tax-exempt organization: A list of qualified organizations can be found here.  Most qualified organizations include churches or religious groups, war veteran organizations, civil defense organizations, other public interest charities.

·      Donating Non-cash items: If you plan on donating non-cash items that have a fair market value of over $500, then you'll need to include Form 8283 with your tax return. Also, before you go through your storage unit to find that broken TV, which hasn't worked in 10 years, and plan on donating it, then you might think again. The IRS allows a deduction for any item that is considered to be in good working condition. At the very least, you should have it valued at its current condition. The Salvation Army and Goodwill each have their own valuation guidelines. Make sure to review the guidelines, along with the items, in which you are donating. This includes clothing, small appliances and other household goods. If you have a price tag or store receipt, it will help provide proof of the value of the item(s).

·      Claiming a Deduction for Food or Groceries: If you plan on donating food or groceries to a charity or church, then make sure to get a written acknowledgement from the charity or church.

·      Take Pictures of Your Donations: this is optional, but it is useful if you plan on donating a large number of items. This allows you keep track of your items, and attaching a receipt or written acknowledgement from the charity about the item you donated to the picture, and then it provides proof and reassurance of your donation.


Bonus Tip: As you plan your final donations for 2017 and gather your written acknowledgements together, you should consider which cash or non-cash items are acceptable for claiming deductions. There are policies in place for the purpose of designating an item or property to be a non-deductible donation. Non-Deductible donations includes:

·      Donations to Political parties, political campaigns or political action committees

·      Donations to individual people

·      Donations to labor unions, chambers of commerce, or business associations

·      Contributions to for-profit schools and hospitals

·      Contributions to foreign governments



Tip #5: Estate Plan Check-Up


Estate planning should be considered an important part of life; more importantly, it is a resource in providing for your loved ones after death. With life being unpredictable, an estate plan brings peace of mind to people while alive and at time of death. An estate plan is made up in parts, which equals up to your overall estate-planning goal.  By having the correct estate planning instruments in place, it provides more meaningful options for how you would like to pass along your assets, along with providing structure, at the same time. If you currently have an estate plan or plan on drafting your estate plan by the end of the year, consider reviewing your current and overall goals. Maybe you thought about giving more to a favorite charity later in life. Or a grandchild was born this year, and now you wish to provide college tuition for that grandchild. Having an estate plan can ensure that your wishes are clear, provide peace of mind that your family is taken care of after you are gone, and protect you while you are alive. If an individual passes without an estate plan, then the individual's state of residence will distribute his or her assets according to the state laws. Speak with an estate-planning attorney today to review your current estate plan.


Questions you should ask yourself, as you review your estate planning documents:


A.    What has changed? - Life is ever changing. An annual review of your estate plan should reflect those changes. Think of estate planning as a part of you, written in a legal document, which reflects the changes of events that happen in your life and as you grow.  Some questions you should consider as you review your estate plan:

o   Has your marital status changed?

o   Are you expecting a new addition to your family?

o   Has your charitable gifting change?

o   Has a death occurred in your family?

o   Have your relationships changed with the people named in your estate plan?

o   Have the health or capabilities of the people named in your estate plan changed?

o   Has your income change?

o   Do you have concerns about something not being included in your estate plan?

o   Are you satisfied with your Executor(s) or Trustee(s) of your estate?


These are some of the question to consider as you review your estate plan and to make sure that they align with your current goals. 

B.    Do you need to update beneficiary designations? - It happens more often than you would think. Some one designates a sibling, a parent, or an ex-wife as a beneficiary, and then that same individual's marital status changes. Years go by, then before they realize it, they recognize that their beneficiary designation forms are not up-to-date. Now, the person, who should have received the assets (wife, children, grandchildren), could end up left with nothing.  Another common mistake, someone creates a living trust, but they forget to name their living trust as a beneficiary.  Instead of having those assets being protected in a trust, these assets instantly lose its structure for more potential growth.


If you are interested in learning more about trusts and their asset protection benefits, then contact our office today to schedule an initial consultation. Contact us at (713) 229-0360 or by Email.

C.    Are you still in communication with all the people you named in your documents? - Relationships often change. You should review everyone named in your estate plan. Think about how your relationship is with that person. Has it changed? Maybe you are still in communication with that person, but their skill set has changed. For example, the person you designated as your Durable Power of Attorney (also known as Financial Power of Attorney) used to be really good with finances, but is now experiencing early stages of dementia. This person is now no longer fit for this position, and you should consider designating someone new. 

D.    Have you received an inheritance? - When you receive additional assets, you should inform your wealth advisor and/or estate-planning attorney, as they may advise you the best way to protect or invest those assets. If you receive government assistance, you'll want to make sure your new inheritance does not negatively affect you from continuing to receive your governmental benefits.  Speak with an estate planning attorney to learn about the ways you can protect your inheritance and continue to receive government benefits.

E.    Have you started any business ventures? - Some questions to consider: Do you plan on keeping your business in the family? Have you decided who would be fit to take over your business when you pass? Would it be better to have a co-owner take full ownership, if you pass? This may require you to make adjustments to your estate plan. Speak with an estate-planning attorney and they can advise you the best way to correct agreements that will match to your wishes, if you have an untimely death during your course of ownership in the business.

F.    Any legal actions pending? - If you are worried about future litigation against you, then you should consider implementing some asset protection strategies. Speak with a local an estate planning attorney about your concerns and questions regarding asset protection from creditors, predators, and lawsuits.


Contact Kiefaber & Oliva LLP


Reviewing your estate plan may not seem very exciting, but it is essential and it provides peace of mind.  As the year 2017 comes to a close, planning now will allow you to make sure that you, your family, and your hard earn wealth is protected for many years. Contact our office to schedule an initial consultation. Our professional attorneys are happy to help you accomplish all of your estate planning goals. Contact our office at (713) 229-0360 or by Email.

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