Inheritance

Episode Transcript

Speaker 1 (00:00):
Hello, everyone, Welcome to the Greg Kicks Show. I'm Greg Hicks,
certified Financial Planner, along with Wanda Cooper Financial Advisor and
our other sidekick. Bo Nicholson is off today and won't
be here, so he'll be back next time. I've been
gone a couple of weeks myself, you have, and I had.
I had a fun Easter break and all that, and uh,

(00:22):
we had a trip up to Pennsylvania and it was
really great with my wife's family and anyway, I'm glad
you guys held the fort down and everything. But here
we are in the beginning of May. So so May day. Mate.
When I was a kid, we had made that we
did we had a thing at.

Speaker 2 (00:40):
Elementary that you go round and round and we had
the maypole.

Speaker 1 (00:45):
Yeah. And then and then years later, like decades later,
I learned that that was some kind of sexual perverted
uh what some somewhere back in the Celtic days about
eight hundred years ago. And then I went, well, where
were we elementary kids doing running around mayfall? Oh my gosh.
But anyway, but I wanted, you know, I have to

(01:08):
do this to start the show today. And by the way,
if you're a brand new listener, let me reintroduce myself.
So Wanda and I and Bow work for a small
business called Financial Resource Management headquartered in Raleigh, one of
the fastest growing cities in America. But we also have
a beach office in Atlantic Beach right on the Causeway,
and we have clients in multiple states, but primarily in

(01:31):
North Carolina. But our show comes every weekend, both in
the Beach area and the Crystal Coast on Saturday morning
at seven and Sunday at three, and then in the
Raleigh area the metro area at two o'clock on Saturday,
two o'clock on Sunday, plus podcasting and all the other
stuff you can hear our old shows and all that,
but for you new listeners, that's who we are, and

(01:52):
we change topics every single week. That's what makes our
show unique, I think. And then we usually start our
show off with I'm like, what's been going on lately
that affects us financially and otherwise. So I have to
do this because the first show in May, remember the
first show in April, Oh my gosh, Donald Trump did

(02:14):
the tariff thing. Oh We're all going to die. And
the pundits on Wall Street who were supposedly calm, long term,
non emotional thinking. They went ballistic too, just like the
media does and all that stuff. So anyway, I want
to remind you April second was when it was announced

(02:37):
that it was the tariff day, and then the market
proceeded to go down. Event eventually some of the indexes
were down fifteen percent within a week or so, and
the sky's falling and everything. We're all going to die
and perish. So here we are now a month later,
and guess.

Speaker 2 (02:54):
What, still here.

Speaker 1 (02:55):
It's amazing how we made it, But here we are.
Let me give you some real stats. The month of April,
the Dow Jones Average, which is the thirty biggest companies
in the country, diversified, went down a whopping three point
two percent. The S and PN decks we all thought
we were falling off cliff. It went down zero point

(03:18):
eight not eight percent, less than one percent. And the Nasdaq,
which is the most volatile because it has a lot
of the tech stocks, guess what it went down. It
went down zero It went up zero point nine percent.
So here we are thirty whole days later, and the
sky didn't fall, and we all didn't lose their job,

(03:40):
and we all didn't get fired. And then, and guess what,
to make it even more fun, inflation went down in April.
Inflation went down. Gas is down, Groceries are down, the
interstates are.

Speaker 2 (03:55):
Down, Eggs are down.

Speaker 1 (03:56):
The eggs are down. So all this heavy breeze, we're
gonna die stuff. Look, look, it's always long term.

Speaker 2 (04:04):
There was still a line at Starbucks every morning that
I went. But that's interesting. They said they're doing technology
to speed up their service. I have not experienced that yet.
And during when when everybody's gonna fall off the edge
of the earth, they still had a line, you know.
And then, but let's talk about some stocks we bought
during this time. I remember I've waited two three years

(04:27):
to buy a Dollar General. Me too, and it finally
came to a price to buy, and I bought it.
Man is now, yeah we are. But you know what
I did buy that? Oh, I'm like, oh my goodness,
I bought it too early? Was UPS? Okay, they're slashing
jobs now, so I don't get it right. Every time.
I got the Dollar General right, but the UPS I
bought a little early. But I'm not worried about UPS,

(04:49):
and neither any of my clients and Nike. I bought
that a lot too early. I should have waited.

Speaker 1 (04:53):
But here we are. Okay, So a good example of
nobody can time the market, but can you? Yes, I
bought it early too, and they're down more. So I've
got them back on my watch list to buy a
little bit more. And why would you do that? Of
a lot of clients will say, why do you buy
something this down? Because if it's a good company with

(05:14):
long term potential, the price is cheaper now. So if
I buy more shares when it goes back up, I'll
get my money back quit and plus I'll lock in.
How about those high dividends.

Speaker 2 (05:26):
That's it. And if you reinvest the dividends, you know
what's happening, don't you. So if you've already got in
your portfolio, just reinvest the dividends and help yourself out.

Speaker 1 (05:34):
That's right. And so again we don't know what may
we'll bring, or we don't know what anybody will look
like a year from now, but we just learned a
great lesson. Don't get panicky, hyperventilating. I will say this.
I loved how our clients reacted. I probably got early

(05:55):
in April. I've probably got maybe fifteen or so emails
and phone calls maybe, And this is what made me
feel good about our clients, Wanda. Most of them, the majority,
said what are you buying? In other words, they instinctively new.

Speaker 2 (06:09):
Even the eighty eight year old clients. I had an
eighty eight year old lady called me and said, what
are you buying?

Speaker 1 (06:14):
What you cash?

Speaker 2 (06:16):
I said, remember your modern conservative riz. I mean, so
let's talk about this.

Speaker 1 (06:20):
Yeah. Well it's like what's on sale a little bit so,
But anyway, again, just steadies the course, state diverse five
and buy when there's opportunities, and don't get don't get
scared just because of some temporary thing. And we knew
that when he announced the terrorists that everybody would freak out,

(06:42):
and they did so anyway, by the way, and one
more thing, just kind of parenthetical, Wanda, you and I
I looked the other day at our percent of money
in cash in account and mine and yours I think
were somewhere around seventeen to twenty.

Speaker 2 (06:59):
Percent, about the same as symboling. Yeah.

Speaker 1 (07:02):
So in other words, we don't we're not fully invested
with zero cash sitting in our accounts. We have cash
there for a lot of reasons. Clients sometimes need money
or the market tanks or maybe an individual ETF fund
or stocks tanks. Well, we have money available, yeah, and
so so having cash. And by the way, cash money

(07:23):
markets are still paying right at four percent, which isn't
bad for no risk summer three. Yeah, but anyway, with
inflation going down three and a half sounds good, right.

Speaker 2 (07:32):
Well, you know, I had a you know, when I
drive to work, I use that time planning in my
head because sometimes they even call you and say I'm
in traffic, I need to talk to you about something.
And then by the way, you can call us at
nine one nine A five six nineteen sixty eight. I
just want you to know we've been doing this business
a long time, and if you work with me, you
kind of get the team because Greg and I collaborate

(07:55):
a lot we do, you know, you know, say I'm
looking at ups or I'm looking at Dollar General your
thoughts or he'll do the same, and you know, so
we you kind of get you know, a two for
one or three for one if you will sometimes so,
but I did have a client call me on the
way to work, or no, I was thinking about a
client on the way to work. All of a sudden,
his name popped in my head and I hadn't heard

(08:15):
from him through the market issues, and I knew that
he had been laid off from his job, and you know,
had a nice, sizable portfolio that you know. I wasn't
really worried about him, but I thought, well, you know,
I might need to call him. So I got here
first Adams call him and he said hey, And I said,
I just wanted to check in because your name popped
in my head and wanted to make sure that you're okay,

(08:36):
and I hadn't heard from you and things like that.
He said, Wanda, I know you're looking out for me,
just like you're calling me today because you thought about me.
He said, I'm not worried one bit. And I just thought, wow,
that just spoke volumes to me.

Speaker 1 (08:50):
Nice. Yeah, And that's what we want people to do.

Speaker 2 (08:53):
That.

Speaker 1 (08:53):
We want freedom to call and talk, but uh, freedom
to avoid panic.

Speaker 2 (08:59):
So you can get a complim memory meeting. So take
advantage of that. Call us at nine one nine A
five six nineteen sixty eight to schedule that. Now you
may have to leave a message because we you do
call in and you hit a button to reach the
assistant that takes the message, but you're free to leave
a message, and we'd love for you to do that.

Speaker 1 (09:17):
Yeah, we'll call you back quick. Now. One more thing
that was announced this week is the growth the GDP,
the domestic product right so, and of course the liberal
media jumped all over it. It went down zero point
three percent for the first quarter. And of course it's
all Trump's fault, just like it was in April. But
I want to point out. I want to point out

(09:39):
that spending on the economy went up three percent and
the reason it went down is people imported five percent
more things early in the month to avoid tariffs later. Yeah,
and that made the gd BEING go down. It didn't
go down literally, just the imports right now. So anyway,
I just want to make ahead to clarify. We're going

(10:01):
to come back with our show today. Today's a great show.
It's on inheritance. Whether you're giving an inheritance as an
older person or you're receiving one. This is a fabulous show.
Stay tuned, Welcome back to the Great Kicks Show. This
is segment two and today we have a great topic.
It's called inheritance and there's a lot of people inheriting

(10:22):
money or a lot of people making sure their kids
and grandkids are going to get an inherited money. And
Wandabaou and I as financial advisors, we are always talking
about estate planning, making sure your ducks are in a
row if something happens, whether you're a younger adult or
an older adult. And then we also have clients that

(10:44):
inherent money and maybe they're thirty or forty or even
fifty years old, and you know, all of a sudden,
you have a windfall of something. Maybe it's land, or
maybe it's money, or maybe it's an ira and you're going, oh,
my gosh, I hate that my parents or grandparents or
aunt or uncle died, but wow, this is a chance

(11:07):
to kind of reset the table on your financial planning.
And there's a ton of money. I looked up. I
forgot where I laid my little cheat sheet.

Speaker 2 (11:18):
Forty six thousand, isn't it average?

Speaker 1 (11:20):
The average? Yeah? And the other thing somehow misplaced by
cheat sheet. But I typed in in the next twenty
five years how much inheritance and it was it was
something like trillions of dollars. I'm like trillions with a tea.
There's a lot of money.

Speaker 2 (11:37):
There are other countries though I looked this up to
us that the average is like forty six thousand. I
thought that was kind of low, But everywhere I read
said forty six thousand average, but other countries the wealth
that they're leaving their children is significantly more.

Speaker 1 (11:52):
Yeah, why that is well, I think the forty six
thousand is well over half. Americans do not have enough
assets to really count as an inheritance, you know what
I mean. So you have the one the article I
read said, even though it's forty six thousand or whatever average,

(12:12):
they said, but if you if you look at the
top ten percent of people, it's way more in the
top one percent, it's like out of side.

Speaker 2 (12:20):
If they're in trust. Is that number show?

Speaker 1 (12:23):
I don't know that.

Speaker 2 (12:24):
That's what I don't know either, because a lot of
people do that.

Speaker 1 (12:26):
That's right, that's right. But yeah, So the good news
is many, many people that are our clients are planning
on leaving an inheritance that their kids and granted kids.
And then sometimes our clients get inheritances and and sometimes
it truly is a game changer. Well some I mean,
I'll just give you a couple of examples. I know one,

(12:49):
and you have funny, funny cases where you think that
your mom or dad have a lot of money and
they died and they had money, but they had debt,
and maybe there's other things you didn't know about. And
then you'll have the surprise where I had a client
one time years ago where there was a little bit
of estrangement between mom and dad and the adult kids,

(13:12):
but when the last parent died, the two adult kids
ended up getting like eight hundred thousand a piece, and
it was like, oh my gosh. You know, you have
that kind of shock too from the other side where
you're not expecting.

Speaker 2 (13:26):
Anything and you do need help. I mean, you do
not want to inherit a large sizeable estate, whether it's land,
you know, proper land, businesses, cash, whatever, our as. You
need professional help. And we do this all the time,
all the time. So call us at nine one, nine, eight, five, six,
nineteen sixty eight. Now, Greg, I met with one of

(13:47):
it was she was your client first and then she
became mine. We've always worked together on her. But she
passed away early in the year and I met with
her son this week and he was just you know,
because his mom raised him as a single mom, and
so as far as he knew, they were poor, they
were like good poor people. Yeah, they Disney tours, they

(14:09):
lived with Grandma, you know, all that kind of thing.
But she just did everything right and she managed to
meagerly save. So she left him an annuity and you know,
ira and things like that. And he was like, man,
I just I just sit him go. I'm I'm shocked.
My mom was great. She really was. I said she
was wow, And I said I really liked her a lot,

(14:31):
one of my favorite people. And you know, he was
shocked because he was he's a farmer, and you know,
he was like, I just didn't know. I never asked
my mom for money, and she never told me her finances.
But I tell you what the attorney said to me, Wanda,
your mom had things nailed down, ironclad. She had planned
how to leave this to him, and she did a

(14:52):
good job.

Speaker 1 (14:53):
Yeah, that's that's amazing. The thing about it is it
can bless both direction. So if you're an older person
and you're just starting to realize, Okay, there's going to
be a day when I'm not going to be here,
you need to get your act together. Now, we always
say this in our radio shows that about seventy percent

(15:14):
of Americans don't even have a will, which is the
most basic thing. A lot of accounts, though, like iras, annuities,
wroth iras for one case, even life insurance, they require
a beneficiary. Yes, so a lot of people don't even
think of it this way, but they're forced to do

(15:35):
at state planning, and.

Speaker 2 (15:36):
That day it may not even be needed in some
of those situations exactly because of the direct beneficiary is
the home, is the bank accounts, and you can even
fix that, you know, TOD transfer on death, so inheritance,
I'm leaving a legacy. All that kind of goes together.
So you do want to nail these things down ironclad
and using my clients.

Speaker 1 (15:56):
Well, it's funny you say that. This week I got
a call from one of my older clients who's fantastic person,
and they were calling to say, what is my how
is my fairly large brokerage account? How is that set up? Again?
And I said t O D And she said t
O D. I said, well that stands for transfer on death.

(16:20):
So I re explained to her that it's like an
IRA beneficiary. You want you will avoid probate, your kids
will avoid probate. The'll it'll just go down to them
through the TOD beneficiary form And she went, really, so
I don't need a trust. And then then she said,

(16:41):
but my lawyer said, and I said, well, I love
lawyers the state A state attorneys particularly are very important.
But but if you have a t o D, just
like your IRA with me, it goes right to the
beneficiary without probate. Oh so she said that I.

Speaker 2 (17:00):
Had that question this week. I'm not so sure. I'm
not sure about really, I'm not either. I think it's
a different animal, which is I found out when my
mom passed that that's what the attorney said. This is
a different ballgame. Real estate goes by direction of the
wheel regardless.

Speaker 1 (17:18):
And the other thing that makes real estate a little
different is sometimes if you're married for along a certain
amount of time and you don't have let's say I
was married and I didn't have my wife on my home.
That also is a special case where it does go
to the surviving spouse. And I don't know all the details,

(17:38):
but I do know it's true.

Speaker 2 (17:39):
I thought that they actually went to the children first,
and then because if you didn't have your wife on
it or.

Speaker 1 (17:45):
Well, there's that too. There's all kinds of.

Speaker 2 (17:47):
Stuff, so be careful if you've not done it. I've
met with some pretty substantial wealth people that don't have
a wheel and don't have a plan a plan, So
please don't do that. At least give us a call
and let us point you in the direction nine one
nine A five six nineteen sixty eight. There is nothing
you're going to pay for this complimentary meeting. And wouldn't

(18:11):
you want to leave our meeting saying I'm glad I
did that. Every meeting I've ever had with a radio listener,
this is the feedback I get. I'm so glad I came.
I've got some information. Now, nobody's signed any paperwork, they
just got the information.

Speaker 1 (18:25):
So they'll always say this is so helpful. Yeah, to
hear all this now there because in Wanda, this is funny.
Some of the richest people ever and some of the
most important political people ever died without a will. I
know that Ernstein Young, remember the old Ernst and.

Speaker 2 (18:42):
Young big age, well didn't without a will.

Speaker 1 (18:45):
Prince was young, but Ernst and Young that partner was
a CPA.

Speaker 2 (18:50):
But who is Prince's money manager? He should have told him.

Speaker 1 (18:52):
I know, well in one of the Supreme Court justices
who died about thirty years ago, I can't can't remember it, no,
but they did not have a will. This is a
US Supreme Court justice, a lawyer. So the problem without
a will, it goes right to the probate court, and
then the probate court has a list of names and relatives,

(19:13):
and then it becomes a little bit chaotic. One of
the worst cases I ever had was one of my
first clients when I first got into business, like forty
years ago. They had a piece of land that the
grandparent had left to the youngest son, which is what
farmers did back in the day. And then the son

(19:36):
was supposed to sell it at some point and divide
the money. Well, he went and died and had kids.
So by the time my client got it, there were
twenty eight people that owned that farm. In other words,
it will never be sold until Jesus comes back, because
you can't get people, I know. And all they needed

(19:58):
was a simple will, like to say, my son can
keep it or buy out my other children.

Speaker 2 (20:05):
All they had to make it rental property, yeah, compound jumping.

Speaker 1 (20:08):
But anyway, that land, which today is no telling how
much it's worth it's locked up between all these cousins
that don't even know each other.

Speaker 2 (20:17):
We had a situation once. It was a rental real
estate and he didn't have a whill and they had
to go down and find nieces and nephews and then
you had to add depreciation back then. I don't know
all that stuff. Oh, it was a nightmare. Don't do that,
Oh my goodness, don't do that. So call us nine
one nine A five six, nineteen sixty eight. So we

(20:38):
can keep you out of trouble. But Greg, one of
the things, and we may not be able to cover
this till after the break, but one of the things
that's hard for families to do is to sit down
and have a conversation. That's why it may be good
to bring them to a meeting just to talk. And
sometimes I'll look at the older parents say is it
okay for your adult child to stay in the room

(21:01):
while you talk to me? Either's yes or no. You know,
and we've got a waiting room we can kindly send
them to. But the bottom line is you've got to
have the conversation. So take us out, Greg, and we'll
talk about it when we come back.

Speaker 1 (21:11):
Exactly right. And I love it when an older client
brings their adult kid in the room and says, Okay,
let's talk's that's the best thing you could ever do.
We're going to come back for our inheritance show. There's
still a lot more information we're going to give you,
so stay tuned and welcome back to the second half
of the Great Hicks Show. Today we're talking about inheritance,
whether you receive it or give it, it's a blessing

(21:33):
and we see that happen a lot with our clientele.
We hope you're going to enjoy the show. We're talking.
As matter of fact, the last couple of weeks, we've
talked about different things in family financial planning. Today's inheritance.
Next week we're talking about generational planning. In other words,
how do you keep things going along, leaving a legacy.

(21:55):
Maybe you have a business, maybe you have land or
a condo at the beach, and all of the things.
So we'll cover a lot of that stuff today, but
we'll also concentrate even more next week, and then I'm
looking forward to the shows after that the early summer,
late May and early June. We're going to talk about stocks,
we're going to talk about ETF and mutual funds. We're

(22:17):
going to talk about real estate investing and so forth.
So we're going to get more into the details of
the investment world. And financial planning is our modus operandae.
That's what we cover everything. But you have to admit
some of the fun and the anguishing part of our
life is on investing. And yet if you invest well,

(22:37):
we've seen historically over the years that you can talk
about leaving an inheritance. Boy, I have some clients that
are like, whoa they're leaving. I mean they're in one generation.
Everything's changed from just being an average person to really
leaving an incredible legacy. And that's fraught with danger too,
leaving too much to the wrong kid or the wrong grandkid.

(22:59):
One time, one time we had a client die unfortunately early,
and he had and there were two kids, both nineteen
and twenty. And the one kid used his inheritance for college,
which was perfect, that's what the mom or dad would
have wanted. The other kid used it to go party,

(23:22):
and so a year later, kid number two was like
the prodigal in the Bible, right, they had blown all
their money. Kid number one was two years later graduating
from college. So just because you get in inheritance, whether
it's expected or not, it all depends on the nature
and the makeup and the personality of the person receiving it.

(23:43):
What you do with it is critical and you will
need to make decisions, hopefully with an advisor holding your
hand and saying, look what about this? What about that?

Speaker 2 (23:53):
Well, to get to an inheritance, Greg, you got to
know what's going on. Like you know, this is what
I was saying before the break is it's very important
to get with your parents and say, hey, you know,
I need to know you know where things are in
case something happens. Nothing's going to happen. I mean, you know,
I hate when people say in case something happens or

(24:14):
because of your age or whatever. That's just not terminology
you want to use with your parents to say, in
case something happens, I need to know where things are,
you know, bank accounts for one case, pension plans, whatever,
and where these things are stored, so I know what
to do in case you and mom are killed in
a plane grash or a car wreck or a health fish. Yeah,

(24:37):
it could be helpful.

Speaker 1 (24:37):
Well, if you go to a nursing home.

Speaker 2 (24:39):
So that way you know what you need to do,
because if you do go to a realabilitation a nursing home,
somebody's got to pay for it. So you need to
know where these things are and their expenses, their debt,
all of that needs to be uncovered. So then you
know how to preserve some of this if you do
the right things early own. Because here's the deal. There

(25:02):
can be an inheritance, but if there's a healthcare issue,
it could, so there's ways to set things up to
protect you with that. I have a lady I worked
with that went to another radio advisor and they had
her so locked up in all annuities. I was just
I was appalled. She was a widow, and she said,

(25:25):
I think I've done something wrong. And I said, what
do you mean. She said, I don't have any income,
and I went, what do you mean. You've got this
big nest egg here, she said, but I can't get
to it. I said, what in the world do you mean?
So she I went, oh, my goodness. She was in
ten year surrender annuities. One was fifteen and she had
a little bit of cash in the bank and I said,

(25:46):
and I didn't want her to pay a penalty to
get out of those. So I said, well, this is
what we're going to do. And so we called the
annuity company, got them to set up an annual distribution
where she can get percent out a year, and we
actually set it up to get monthly. And she called
me and she said, oh my gosh, Wanda, I feel
so much better. And that's all she needs now. So

(26:09):
you know what we did with the other tu annuities,
she's preserving that for long term care. So we've got
her set up for a health event and all the
income she needs. Yeah, I don't know what in the
world does people she was seventy eight years old too. Oh,
and I'm like, well, how do you justify that? So
this is a part of estate planning, so for her children,

(26:31):
they're not going to have to worry about her and
a health event, and she doesn't use it for health event,
it's there for them.

Speaker 1 (26:37):
Yeah, And that brings up the whole idea of liquidity,
you know, making sure you know, if you inherit land
for example, that's not I mean you made her inherit
a million dollar piece of land, but that's not real money.
So that does not quote change your income or lifestyle.
So and then there's all kinds of tax loopholes, and

(26:57):
I call them loopholes. They're not they're not meant to deceive,
but they're there. Like if you inherit land or stock
for example, or are even a home when they die,
the value comes to you at the current value at
the day to death, not when they bought it thirty
five years ago. But on an ira, if you inherit

(27:17):
an ira and you're not a spouse, you have to
pull that money out in ten years, and it's one
hundred percent taxable, and a lot of people just jump
to inclusion that say, oh my gosh, I heard it
one hundred thousand dollars ira. I need that money to
pay off my mortgage. And they sell it and they
forget that it's taxable. So they're going to lose thirty
thousand dollars and a year later you're going to get

(27:40):
a call from your accountant going you owe thirty thousand
in taxes and you go, oh my gosh. Again, get
some advice when you receive an inheritance, and then as
a person who is leaving that inheritance to kids and grandkids,
it's very helpful like Wine has said, to sit down
with an advisor and explain. You know, when somebody eyes

(28:00):
I usually start with one, two, three, four, If you
have an IRA, if you have land, if you have stock,
go down that list and explain. Just we're not CPAs,
but we know enough to explain taxes, and taxes can
catch you off guard and wipe out some of your
inheritance if you're not careful.

Speaker 2 (28:19):
Yeah, so you know, full disclosure and talking to your
family is going to be important and a lot of
times great our generation and older we like to bless
while we're still here. But you have to keep in
mind if you give anybody you know stock or land
or a home or whatever, then they are inheriting your

(28:41):
cost basis, so you have to be careful of that.
If you don't care about that, so be it. But
they will care. The people that are getting it will
care if they ever ever sell it. And families are
bad about saying, oh, they would never sell it, don't
be too sure, don't want so it's better to leave
it to the airs and instead of gifting it to them. Now,

(29:02):
that's the bottom line. You bless them in bigger ways
by waiting.

Speaker 1 (29:06):
Yeah, or give if you want to give. Now, the
simplest thing to give is cash exactly. ASH has no
tax exactly. And by the way, the irs, the government
and Congress do things. Okay, once in a while, there's
a there's a gift tax free gifting. Up to now,
it's nineteen thousand per year per person. So if you

(29:28):
have three grandkids and one daughter, you can give nineteen
to each of them, and your spouse can give nineteen.
And for very wealthy people, we actually recommend that you know.

Speaker 2 (29:39):
And make sure you can do it. You're not you know,
cutting your nose off despite your face. You don't need
it for income, you don't need it for health care
or whatever. Yes, gift, but if you're going to need it,
don't do that.

Speaker 1 (29:52):
And that. Yeah, so if you're on the edge, I'm
talking about people that have it because and by the way,
why not give it in a five twenty nine plan
for a grandkid? I think that's fantastic. You bless them,
You bless your kids because you're helping pay college for
your grandkid. But you can give up to nineteen thousand

(30:12):
a year in a five twenty nine and it grows
tax free as long as the kid uses it. For education.
How can you beat that? Right?

Speaker 2 (30:19):
And I see so many parents that toil, you know,
in their mind with as they add grandchildren. I think
I need to catch this one up. I'm like, no,
you don't have to do that. This one was born
in you know, two thousand. This one was born in
two thousand and five. You just start from this day. Yeah,
you know, don't do it. And they have angst about it,

(30:41):
but they need liquidity, they need the money, and they
have angst about it. Do not do that. You don't
have to catch that grandchild up. Just do for them
what you're doing for the other two. But you don't
have to catch them up. Now. If you do this,
your business. But I'm just saying I would caution you
on that.

Speaker 1 (30:56):
Yeah. And there's also a little traps like the sun
the thirty year old son's got a new business and
he comes to mom and says, I need fifty thousand
dollars and when it grows, I'll pay you back. And
I always tell clients that call me about that, I'll say,
have your son come and talk to me first. And
you might want to be in the room business, yah, yeah, yeah,

(31:16):
or a gaming Ilmost start a gaming business everybody's playing
games because you know, and this is hard for mom
and a dad that they love their kids. But but
use us, use the advisor as the shield and the
objective person like I don't. I don't give a hoot
about the gaming business, but I can be objective and

(31:37):
see what the odds are of success. Yeah, and just again,
it's this is where love and emotion gets kind of
tied up in a family. Another emotional thing that's very hard,
and I just feel so bad for people like you.
Let's say you had three adult kids and one of
the one of the kids married a loser, and then

(32:00):
you have grandkids with a loser. Do you how do
you help the grandkids inherit money without without making sure
the bad spouse steals money. It's very hard. There are
a few little wrinkles you can do, and you can
put it in your will, like you can have your
will dole out money over the years, not lump some

(32:21):
for example. You can do that under trust. Some annuity
companies will let you dole it out over time. There's
always a way to figure out with really odd situations
like a bad spouse taking marriage or a special needs kid.
I have a special needs kid, so I have a
special needs trust set up in advance when I die

(32:43):
so and so that way you protect your family. So
there are methods and tools, but you need to learn
what they are. So if you need to talk to someone,
call us at nine one nine eight five six nineteen
sixty eight and we'll be glad to talk to you.
And we also have a website, by the way, before
we take our last break, our website is frm NC

(33:07):
that stands for a Financial Resource Management Our business name
North Carolina FRMNC dot com and you can email us
if you want to, but we prefer that call nine
one nine eight five six nineteen sixty eight. Stay tuned.
We still have one session to go, and welcome back
to the last segment of the Great Kicks Show. Next

(33:28):
week we're going to be talking about family functioning. The
official topic of the show is generational financial planning, and
today is kind of part one of that show. We're
going to do next week. Today's inheritance and how do
you set it up so your kids and grandkids inherit
things and money and assets and so forth, and lower taxes.

(33:49):
And then also how do you receive an inheritance the
tax implications, how do you spend it? What do you
make it a priority? List to do first, and so forth,
And so we're in our last segment now, but we
want to let's finish up here. One thing I like
to do when people get it in here and just

(34:10):
say okay, I always say what are your debts? What
is your mortgage? Because remember that successful financial planning is
not just investing in a great mutual fund and it
grows and all that, it's also lowering the expense side.
And a lot of times debt is just a killer
to people, not only financially emotionally. So I always say,

(34:32):
let's look at debt and paying off mortgage first. Are
you going to move anytime soon? That kind of thing?
And then after that you can talk about boy, I
would you're like to get a new car or something
you know, or whatever the needs are. So be sure
to be sure not to quickly emotionally react to react. Yeah,
get some advice and take deep breath and take your
time and make sure you're doing in an orderly fashion.

Speaker 2 (34:53):
Well, meet with someone, give us a call. Nine one
nine A five six nineteen sixty eight.

Speaker 1 (34:58):
Now.

Speaker 2 (34:58):
One of my favorite things, Greg, especially if it's an
adult child inheriting an ira. You know, they have to
take out all the funds by year ten. I like
to see them do it annually so they're not doing
a lump sum in year ten. Now I believe there's
going to be different versions that people believe of that,
but I just think that's better to do it once

(35:19):
a year.

Speaker 1 (35:20):
And one of the things number it's all taxable. Yeah,
that's something people forget. Yeah.

Speaker 2 (35:24):
Well, and you know, I'm surprised that the government hasn't
come up with allowing these people to do wrath conversions.
I think it's dumb that they don't. But this is
what we do to get around that. If they can
qualify for a wroth Ira contribution, you know, there's all
these qualifications and income of this and whatever, I say, well,
take the distribution, pay the taxes on it, open up

(35:46):
your wroth Ira for you and for your wife. So
they love that idea, and so we do that. And
then I also say build an emergency fund. If you
don't have six months of expenses liquid in the bank,
let's get that done. If they're somewhere fifty five and over,
I suggest let's look at a piece of that to
do long term care because there are all kinds of

(36:09):
long term care products out there that you can fund
it lump some you can fund it, you know, annually
or whatever. And it's money that you'll you'll never lose,
it'll pass to someone. So I do take care of that.
I do take care of paying off debts and mortgages
things like that. So it is something. But bottom line

(36:30):
is you do want to honor your loved ones wishes.
If you know of something they really wanted you to
make sure you took care of, you want to honor that.
And one of those is several of our clients have
the charitable donor advised funds and right so if there
was a charity that's near and dear to them, and
you know that, and you've always known that, there's nothing

(36:53):
wrong with making a contribution to that because those go
on even though that person may have died, that can
go on on in giving. So if you know that
about your loved one, it is something to consider having
an in perpetuity type of fun that keeps giving to
a love charity.

Speaker 1 (37:11):
Yeah, and we love the don donor funds because you
give it while you can. Maybe you have a highly
appreciated stock. It's worth twenty five thousand, and you only
paid five for it. Opened a donor directed fund. It's
a charitable gift. Under the IRS code, you get to
write that off. And then if you die four years
later and you still have ten thousand dollars in there,

(37:32):
you can put your kid as the inheritor of the charity.
Is what you're saying. And it goes on another important night,
and we haven't mentioned I don't think yet. Was the
second marriage, yes, because that affects inherent's a lot. So
I can use myself. Real quick story. So my wife
passed away about eight years ago. I met her when
I was ten years old. We lived a long, wonderful

(37:53):
life together, had two kids and two grandkids, and then
she passed away with leukemia and a real good friend.
I met a lady called Laurie in New York from
Pennsylvania and we've been married six years. So she has
four kids and two grandkids. So again, second marriage just
breaks opens a can of worms, like what do you do?

(38:14):
So we signed a prenuptial agreement and Laurie at first
was told by her Laurier friend, if Greg brings a
prenup up, run and I said, Laurie, you don't want
me getting your house when you died, do you? And
she went no, And I said, the prenup will take
care of all that. So you just sort of it
makes the adult kids relax. They're not worried about, oh,
they're coming to steal my money, so anyway, that's important.

(38:37):
But then also, you know, I arranged to have one
of my iri annuities with her as joint income and
bought a little life insurance. You know, you can always
adjust to the second marriage and the second children. But
we've seen disasters because there was no good planning, and
then families get mad when somebody dies and then they

(38:59):
hate each other. So it's amazing. Financial planning is not
just financial, it's emotional and it's critical for the well
being of your kids and grandkids, particular if you're in
the second marriage. So if you've never done that, college
at nine one, nine, eight, five six, nineteen sixty eight,
and we'll talk about how to make that work.

Speaker 2 (39:20):
And believe it or not, you may be listening and think, well, that,
how can that happen? But I have met with someone
recently that the second marriage was twenty six years wow.
And the last one passed away. Dad passed away a
few years ago, and dad of this set of children.
Mom of this set passed away this year. And I

(39:43):
met with the son and he said, the other children
are now calling for what dad had before.

Speaker 1 (39:53):
Way back, and I'm like a few decades.

Speaker 2 (39:55):
So when you do know that your mom was married
to their dad for twenty six years, so when he
passed eight years ago, it was left to her his
spouse of twenty some years, so they don't get any
of that that was on him if he wanted to

(40:16):
do something different and they wanted to come and kind
of raid the house, you know, and I said, he said,
I'm okay with that. We want to get stuffed. That
was his And I said, yeah, but be careful because
I went through that too with my mom. And you know,
one of my family members brought in a bunch of
people and they were walking out with stuff that we

(40:38):
hadn't planned.

Speaker 1 (40:39):
On really, So just invite your friend Joe.

Speaker 2 (40:42):
Some of stuff got gone that we should not tag anything.
So I said, be careful of that. I said, you
give them a time to be there and tell them
that two can come or three or whatever. And you
have you and your wife there to monitor. So yeah,
so all that, we've been all that with all of
our clients. So again you call us at nine one

(41:05):
nine A five six, nineteen sixty eight to schedule your
complimentary meeting. Believe it or not. Between the two of us,
I know that we've got a lot of years under
our Now we've seen it all.

Speaker 1 (41:15):
And some of it's ugly. So when you get to inheritance, yeah,
Now we'll mention one thing. If you're a person of means,
you're fairly well off, you can open up charitable trust.
If you're charitably minded, you can open up trust gifts
some large asset, land or stock or whatever, it's got
a lot of capital, gain in it and get a
guaranteed income for life for you and your spouse, and

(41:37):
then when you die, the rest of it goes to charity,
for example. So there are big things you can do
like that a charitable trust idea, or there's little bitty
things you can do. But the point is this is
what financial planning is all about. Why go through chaos?
Why Di and I we see stuff that's just horrible

(41:58):
because when people pass away, they didn't plan, and they
don't they didn't intend to and some people really believe
they're not going to die. I mean, I'm serious. Wy
Do you hear people say, well, I will live to
be one hundred years old. I go, okay.

Speaker 2 (42:11):
She also says she was gonna take all of her
jewelry with her.

Speaker 1 (42:14):
Good luck with that, yeah, yeah, and then somehow it
stayed afterhow stayed my mom?

Speaker 2 (42:20):
My mom was organized, She was a planner.

Speaker 1 (42:22):
Yeah, she was kind of instinctively. She had a little
drawer when she got a very in cancer. The first
time she pulled a drawer up and there was a
little a little case. She opened it up and said,
here's my funeral plans, the hymns. And I went Mom,
and I was like, I mean, I was like in
my forties. I was like, oh, that's kind of morbid.
She said, no, it's not. She said, you'll you'll thank

(42:44):
me one day, And I did because because Mom had
in other words, great financial plan in the estate area.
Now I didn't, in hear it a lot of money.
She wasn't wealthy, but I loved it that she was
organized and she had her will set up and everything.
So I was like, thank you, Mom, And that's what
you want to do. You can bless your children. If
you're older in a huge way, just by being planned,

(43:06):
planning wise, you're organized and it's not a morbid thing.
It's it's kind of like when Laurie said to me,
don't talk about a prenup, But that means you don't
love me. No, that's not true. It means I love
you more. So. Planning for your passing and inheritance for
your kids and grandkids, that's loving them. They will thank
you forever that they didn't have a war against each

(43:28):
other and bitterness and anger and all of that that
can happen if you don't plan right. It's just reality.

Speaker 2 (43:33):
And if you're out there wondering on the assets that
you have and how they're going to pass, and you
know what happens. You know that's what a good financial
advisor would be able to tell you. So schedule that
time again nine one nine A five six nineteen sixty
eight to just talk about your situation, because your situation
is not your neighbors. It's all what you've done in

(43:55):
your lifetime may not be what they've done. So you
want to make sure that your situation is taken care of,
not do the same thing as neighbors because it may
not work. So give us a call nine one nine
A five six nineteen sixty eight.

Speaker 1 (44:11):
And you know, we hear that wind all the time.
Well I heard about something. Have you heard about this?
And I always go, where did you hear it? And
it'll be at a picnic or yeah, at my family reunion.

Speaker 2 (44:24):
I hear this all the time. I'm gonna have to
pay inheritance tax. Yeah, there's no inheritance tax in North Carolina.

Speaker 1 (44:31):
Or they'll say what about my federal estate tax? And
I'll go, whether you have fourteen million that worth? And
they go, I don't think so, And I think I
don't think you do either.

Speaker 2 (44:38):
When is that going to sunset? Though?

Speaker 1 (44:41):
Well, it's not to see the Trump Well, the Trump
tax law is going to be in perpetuity as soon
as Congress votes vote. And that's fourteen million per person.
So unless you have a net worth of over twenty
eight million, you're not going.

Speaker 2 (44:55):
To pay federal security not being taxed.

Speaker 1 (44:58):
I know, I know. So anyway, point being lots of
moving parts and inheritance, but we can help you solve them.
Just call us again at nine one nine eight five
six nineteen sixty eight and next week we'll talk about
financial planning with your family and remember this, it's your money,
it's your future, don't blow it. Advisory services through Capital

(45:20):
Investment Advisory Services LLC. Security is offered through Capital Investment
Group Bank Remember Finra and SIPIC one thousand, et six
Forks Road, Raleigh, North Carolina nine one nine eight three
one twenty three seventy. Past performance is not indicative of
future results