9 Key Ways to Protect Your Wealth & Your Family! (Part 1)
Image sourced by Marissa Grootes @marissacristina
Welcome back!
In this edition of Budget and Grow Rich®, we’ll break trend a bit from our usual theme of saving money and building wealth and focus on wealth protection and asset protection.
This edition isn’t about saving money but more about protecting your wealth and making sure that you protect yourself, your family and your heirs!
Believe me please – these tactics could save you and your family Big Money! And lots of headaches too!
Well, last weekend the Big College Reunion came and went. . . I’m reluctant to tell you the number (year). . . ☺
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I took the Amtrak train from New York to Philadelphia, which saved time, hassle and money.
The Amtrak roundtrip fare was $115 plus I got to relax, worry-free.
It so happens that Amtrak stops at the New Rochelle, New York train station which is not far from my house.
If I had driven to Philadelphia and parked my car at the hotel, it would have cost gas and tolls; plus two nights of valet parking at $60 per night – $120 plus tax. Which exceeded the cost of the Amtrak tickets. Yikes.
Although, it turned out that there was less expensive parking nearby. I wasn’t familiar with the Philadelphia Convention Center Area in Center City so the train, Uber and a taxi or two did the trick.
The Amtrak fare was low because I had booked my tickets more than four (4) weeks in advance.
I saved the parking fees, tolls, hassle and wear and tear on my car and more important, me. NICE!
Approximately 150 out of a class of ~2,500 showed. It was great to see everyone!
Even my college girlfriend who was on her third husband was in the house. We didn’t marry; but while we’re on the subject, my ex-wife and I didn’t go the whole distance either. . .
Unfortunately, my freshman roommate Jeff didn’t show. I hadn’t seen him in a few years. I had texted him off and on but he didn’t respond. So, I stopped.
Jeff had been living with his girlfriend Susan for nearly seven or eight years. A fantastic person and a great match! They planned to get married!
At the reunion, I saw our mutual friend Tim and of course asked how Jeff was doing. Tim told me. . .
“Susan retired from her administrative position at a local hospital last spring. Soon thereafter, she got Cancer. Tragically, she died around Thanksgiving!”
Awful.
Susan owned a nice house, free and clear – she’d paid off her mortgage. No debt, debt-free, – a nice place to be.
She also had a very nice pension from the hospital where she had worked for over 25 years.
When Susan divorced her first husband some 25 years earlier, she bought out his half of the house – the ‘marital residence’.
Turned out though that for whatever reason, Susan NEVER changed the deed from joint ownership to sole ownership in her name.
After all those years, Susan AND her ex-husband Still jointly owned the house. BAD Situation, VERY BAD!
Don’t know if she bought him out informally, without an attorney; never filed the paperwork; or had hired incompetent or sloppy legal counsel.
I have no idea what happened. We’ll never know and I don’t dare ask.
SLOPPY! This cost her and really Jeff dearly at the end of the day.
Given the lead in, as you probably have guessed by now, the ex-husband shows up, claims ownership of the house and seizes it.
I’m guessing it was “joint ownership with right of survivorship”.
Joint ownership with right of survivorship (sometimes called “JROS”) means that the survivor receives and then owns the other person’s stake in the property.
Jeff had to vacate. Ouch!
Susan’s pension?
Not a dime for Jeff.
To make matters worse, since Jeff and Susan never married Jeff was NOT entitled to any of Susan’s pension benefits.
So, in effect, Jeff had to start over, of course emotionally but financially too.
CRAZY – you can’t make this stuff up.
And by the way, this is NOT the first time I have heard a story like this. If memory serves, this is the third or fourth story like this I’ve heard in the past couple of years.
Since You are reading this blog post, now you can beat the rap with your financial roadmap.
Take these 9 mission-critical steps right now to avoid this unnecessary mess and protect yourself and your family, money, and wealth.
Do NOT delay. Don’t dawdle! Don’t watch yet more Netflix or more ballgames. Don’t meander. Don’t whatever. Jump on these tasks right away! Get Moving Now:
1. Revisit your personal and financial goals.
Assess where you are today vs. where you want to go tomorrow and in the days and years ahead.
Update your financial plan and estate plan as applicable.
2. Make a detailed list of your financial accounts and a description of your financial affairs.
I call mine “Arthur VanDam’s Financial Roadmap.”
Your Financial Roadmap document doesn’t have to be as thorough and complete as mine, but it should be comprehensive and provide adequate instructions – how to handle things – detailed enough for your attorney or relatives to get the job done. How to get the job done for you and your family.
They’ll have to take a then current inventory of your assets and liabilities; extinguish your debts; potentially sell some or all of your assets; and see that everything gets to the right place – the correct beneficiary.
Me? I want to make it crystal clear and easy for my brother to handle my financial affairs if I become incapacitated, disabled or die.
Give photocopies of key documents and account statements to a key family member and/or your attorney or accountant – someone you trust implicitly without question or hesitation.
3. Make a complete list of all your accounts and user names with passwords.
In addition to financial accounts, including cell phone, email, and other online accounts including digital assets.
In particular, be sure to cover your digital assets – Bitcoin, Ethereum, etc. – especially if you have a set of special keywords that enable access to a cold storage wallet.
4. Measure your financial goals vs. your financial position – your net worth, your assets and liabilities, etc.
5. Determine the steps you need to take to ‘clean up your financial house’.
Make a list of open items (tasks) you have to handle and schedule a time (deadline) to complete each one.
6. Organize your financial affairs.
7. Evaluate your professional advisors – legal, accounting, tax, and financial advisors – regularly with an objective view and a detached eye.
If they’re not up for the task, send them packing! Hire new professional advisors ASAP.
Recently, I parted ways with a close friend of mine who was my attorney. Jack handled several projects for me over time. Over time, our work got more sophisticated. Unfortunately, he made a few mistakes and I felt that his knowledge wasn’t as comprehensive as I would have liked and he wasn’t up for the tasks at hand. As disappointing and difficult as it was, I had to say goodbye.
8. Hire (engage) your professional advisors to help you create a plan and implement it.
9. Organize your legal affairs. Clean up your ‘legal house’ ASAP.
Make sure that the legal documentation matches your financial plan.
Make sure that the legal status and legal documentation (legal documents) – the signed contracts and signed agreements – that cover your assets (what you own) and your liabilities (what you owe), have been prepared in accordance with your wishes and properly executed (properly signed).
You might need to get your signature ‘notarized’ by a notary public who witnesses you sign the document.
In Part 2 we deliver eight more ways to protect yourself, your family and your wealth; and in Part 3 we deliver a roadmap you can use to make it happen.
Let the Budget and Grow Rich® Team know how we can help you!
See you next week,
Arthur V.
P.S. To Create More Free Cash, Save More Money on Groceries, Every Day – click here.
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