Money News: Retirement Solutions for the Affluent

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Having a comfortable nest egg is not a guarantee that retirement worries will vanish. According to a recent Gallup Poll, the majority of Americans, low income as well as the more affluent, report to be “very” to “moderately” concerned about their retirement savings.

Retirement has its own set of worries which can be as consuming as pre-retirement which caused probably more than you a few sleepless nights. Upon entering retirement, no longer will you have the regular income or paycheck you have been accustomed to receiving. So, even if you have earned the comfortable retirement, it is going to take some critical planning to sustain and grow your financial portfolio over the next several decades. 

In this plan you will want to include ways to minimize the taxation of your estate and provide effective means for continue growth of your assets.

Although, we cannot guarantee you the best and most peaceful sleep, we can offer some solutions that may help you rest a bit easier.

Let’s say you have an estate that is over 1 federal state tax exemption, or 5.5M and you are a business owner. It is likely that much of your estate value could be in the form of equipment, property and other non-liquid assets.

Should you pass on without a plan in place, your heirs would be called on by Uncle Sam demanding 50% of your estate to be paid in taxes. Your heirs would then be forced to sell off your assets at pennies on the dollar.

AJ of Hugo, MN had a very similar experience…AJ’s father passed away with his estate assessed at 7.7M dollars. Upon his passing, 3.8M of his estate was owed in death and estate taxes. Since most of the estate was in real estate and proper planning was not made, every piece of property was sold to pay taxes. The property was sold at 40% of its appraisal at the time of his fathers’ death.

Ten years after his father’s passing, the family had yet to see any money from the estate…

A.J. stated: “If we are lucky, maybe at the end of the year, after we pay the last $350,000 to federal and more to the state, my mother, sister and I may have all of $200,000 to split between us…Great!”

In order to avoid this type of scenario, AJ’s father could have set up an A-B trust to allow for 2 exemptions instead of only one and taken out a second-to-die life insurance policy. Any liquid assets, could have been gifted to his children and heirs prior to death.

Another very important thing to include in your plan and one that can quickly eat away at your nest egg, is long term care. Ask yourself the question, “Do I have a plan in place that would avoid a majority of out of pocket cost, in the event my spouse or I should require long-term care?” If your answer is no, this is a subject that you should be addressing. A good Long-Term Care policy would definitely be in order.

Financial Retirement Planning is a very important and arduous task, not meant for the faint of heart. So, in order to maximize the growth of your assets and investments, insure that you pay the lowest taxes possible and structure a long-term care plan, it is always advantageous to consult a trusted financial advisor. A good partnership with an experienced and reputable advisor will help educate and empower you to remain financially independent throughout the duration of your golden years and beyond.

Retrieved from: The Personal Case against the Estate Tax

2015 Policy and Taxation Group

About Reid Abedeen

Reid Abedeen is a partner at Safeguard Investment Advisory Group, LLC ( As an investment advisor, Abedeen has helped retirees for nearly two decades with issues such as insurance, long-term care planning, financial services, asset protection and many other areas. He holds California Life-Only and Accident and Health licenses (#0C78700), and holds a Series 65 license, and is registered through the Financial Industry Regulatory Authority (FINRA). Abedeen is a family man who owes much of his fulfillment in life to his wife, Smyrna, and his three children, Yusef, Leena and Adam.

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