Making long-term care decisions for aging parents can be emotional, stressful and complicated. The biggest challenge is navigating differences without damaging family relationships.
Different views are normal: Each sibling brings a unique perspective. One may prioritize safety, another independence and another cost/logistics. Different priorities don’t mean someone is wrong—they reflect different experiences and concerns.
There’s no perfect answer: When it comes to long-term care, there is rarely a single “right” solution. In-home care, assisted living, memory care and nursing facilities all involve trade-offs, so focus on what reasonably meets your parent’s safety, dignity and quality-of-life needs.
Help exists: Geriatric care managers, eldercare attorneys, social workers, patient advocates and support groups can help guide difficult decisions. Kupuna Pono also offers family conferencing and mediation to help resolve kupuna care disagreements.
Keep relationships first: Aim for 80% agreement on the plan, then commit 100% to supporting it. Protecting family relationships matters more than being right. Disagreements happen, but remember that help is available and families can move forward together with the right support and perspective.
Making long-term care decisions for aging parents can be emotional, stressful and complicated. The biggest challenge is navigating differences without damaging family relationships. Different views are normal: Each sibling brings a unique perspective. One may prioritize safety, another independence and another cost/logistics. Different priorities don’t mean someone is wrong—they reflect different experiences and concerns.…
An inherited individual retirement account (IRA) is a potential financial windfall that may create new opportunities for achieving your financial goals. If you are a beneficiary or expect to be one in the future, know that recent legal changes regarding inherited IRAs can result in costly implications if not followed properly. The Internal Revenue Service (IRS) has clarified rules included in the 2019 SECURE Act that are important for IRA beneficiaries to understand. Determine if these new rules are applicable to your situation:
Different beneficiaries have different rules. Spouse beneficiaries will ultimately have much more flexibility with how they utilize an inherited IRA. Spouses can spread withdrawals from the account over their lifetime or roll the funds into their own IRA. For most other beneficiaries, such as children or grandchildren, the rules are more rigid. Non-spouse beneficiaries inheriting an IRA between 2020 and 2024 were required to withdraw all assets from the account within 10 years of the original account owner’s death.
New, more stringent rules in 2025. Those who inherited an IRA beginning in 2025 face more restrictions. In most cases, non-spouse beneficiaries must take annual IRA distributions from the inherited account. The annual distribution requirement applies if the account was inherited from an IRA owner who already reached the required minimum distribution (RMD) age before death, which, under current law, is age 73.
Annual distributions are determined using the IRS life expectancy calculation tables. The distribution must, at a minimum, equal this calculated distribution amount. The beneficiary can take larger distributions, but annual minimum withdrawal requirements must be met for the first nine years. In year 10, the balance of the IRA must be distributed. Failure to withdraw at least the minimum amount can result in a penalty equal to 25% of the under-distributed amount. For example, if you are required to withdraw $20,000 from the inherited IRA, but only took $10,000, you could be subject to a $2,500 penalty.
If the account was inherited from an owner who did not yet reach RMD age, the beneficiary still has 10 years to withdraw all the money. The beneficiary will also have the choice to determine how much and how often. The new, more stringent rules don’t apply to beneficiaries who are minor children, have a disability/chronic illness or for IRAs held in certain trusts. If these exceptions are met, beneficiaries can “stretch” inherited IRA withdrawals over their lifetime. To determine if your inherited IRA is subject to new distribution rules, contact a financial advisor and tax professional.
Planning is even more critical. Withdrawals from an inherited traditional IRA result in more taxable income. Consider the financial and tax implications of your withdrawal strategy, including whether the distributions will change your tax bracket. Distributions could mean your income reaches thresholds that result in increased taxes, higher premiums for marketplace health insurance coverage under the Affordable Care Act, or a higher tier for Medicare Part B and D premiums.
Contact your financial advisor to discuss the impact of an inherited IRA.
MICHAEL W. K. YEE, CFP,® CFS,® CLTC, CRPC® 1585 Kapiolani Blvd., Ste. 1100, Honolulu, HI 96814 808-952-1240 | michael.w.yee@ampf.com ameripriseadvisors.com/michael.w.yee Michael W. K. Yee, CFP®, CFS®, CLTC®, CRPCTM, is a Private Wealth Advisor/Financial Advisor with Ameriprise Financial Services, LLC in Honolulu, Hawai‘i. He specializes in fee-based financial planning and asset management strategies and has been in practice for 42 years.
Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the CFP® certification mark, the CERTIFIED FINANCIAL PLANNER™ certification mark, and the CFP® certification mark (with plaque design) logo in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements.
An inherited individual retirement account (IRA) is a potential financial windfall that may create new opportunities for achieving your financial goals. If you are a beneficiary or expect to be one in the future, know that recent legal changes regarding inherited IRAs can result in costly implications if not followed properly. The Internal Revenue Service…
Selling real estate is one of the most impactful financial decisions you make. Understanding taxes, especially capital gains, can make the difference between simply selling a property and creating a lasting legacy.
When you sell your property for more than you paid for it, the profit is called a “capital gain.” If the property was owned for less than a year, the capital gain amount is taxed as ordinary income. If held longer, it’s taxed at a lower federal rate (0%, 15% or 20%), plus state taxes. But there are ways to minimize these taxes.
The primary residence exclusion benefit allows eligible homeowners to exclude up to $250,000 of capital gains for a single owner and $500,000 for married owners filing jointly, if they’ve lived in the property two of the last five years.
For investment properties, a 1031 exchange lets you sell and reinvest in another like-kind property, deferring capital gains and keeping more equity working for you.
A 1031 exchange can improve cash flow, diversify your portfolio and strengthen your real estate plan by passing on property with a stepped-up cost basis. By planning early and always seeking advice from a tax professional and real estate wealth advisor, you can prevent family disputes and create strategies to build, protect, preserve and transfer wealth for future generations.
Selling real estate is one of the most impactful financial decisions you make. Understanding taxes, especially capital gains, can make the difference between simply selling a property and creating a lasting legacy. When you sell your property for more than you paid for it, the profit is called a “capital gain.” If the property was…
Hawai‘i’s estate tax exclusion remains at $5,490,000 per person, with tax rates as high as 20%. While this may seem like a high threshold, many Hawai‘i residents can exceed it quickly—especially when factoring in the value of a primary residence, inherited assets, life insurance proceeds, retirement accounts and investment portfolios.
Minimizing exposure to Hawai‘i’s estate tax should be a key part of your estate planning strategy. One of the most effective yet often over-looked tools is estate tax portability. This allows a surviving spouse to use the unused portion of the deceased spouse’s estate tax exclusion—potentially doubling the exclusion to $10,980,000. However, portability is not automatic. You must file a timely Hawai‘i estate tax return after the first spouse passes away, even if no tax is due at that time. Unfortunately, many families miss this opportunity because their advisors whether attorneys or CPAs—are unfamiliar or uncomfortable with the process and simply don’t file the return.
Failing to claim portability can result in a significant and unnecessary estate tax burden when the surviving spouse dies.
If you or your spouse have a combined estate nearing or exceeding Hawai‘i’s exclusion amount, now is the time to plan ahead and take full advantage of the available estate tax strategies.
Hawai‘i’s estate tax exclusion remains at $5,490,000 per person, with tax rates as high as 20%. While this may seem like a high threshold, many Hawai‘i residents can exceed it quickly—especially when factoring in the value of a primary residence, inherited assets, life insurance proceeds, retirement accounts and investment portfolios. Minimizing exposure to Hawai‘i’s estate…
One of the great benefits of retirement is having the freedom to pursue new interests and hobbies at your leisure. For many, travel is at the top of their retirement bucket list. The key question is how to make sure your retirement savings can keep up with your travel ambitions. The following considerations can help you determine your answer:
Make travel a part of your retirement budget. Without the funds to pursue travel, you likely won’t get too far. As you plan for your living expenses, include travel as a line item in your retirement budget. Identify a portion of your monthly income to cover travel expenses before you hit the road.
Consider travel timing. Most retirees plan their biggest travel excursions in the early years of retirement, when health challenges may be fewer and stamina is greater. Therefore, your travel budget may represent a larger portion of your overall expenses in the first years of retirement. If this aligns with your travel vision, factor it into your retirement budgeting strategy.
Determine your travel style. To come up with a reasonable cost estimate, identify the types of traveling you would like to do. Are you more interested in short trips to nearby locations, mostly traveling by car? Do you plan to explore the country in an RV? Are you looking to visit foreign destinations on a regular basis? Your travel goals will tell you a lot about how much you are likely to spend, which should be reflected in your retirement plan.
Find ways to cut costs. It’s easy to face “sticker shock” when you travel. Expenses like food (usually eating out), lodging and transportation can add up quickly. If you plan to stay in one place for an extended period, look into renting a home or apartment rather than “hotel-ing” it. Try to eat like the locals by buying food at grocery stores and markets. Take the time to look for flight deals or make your automobile travel routes as efficient as possible. One of the perks of being retired is that you may have more flexibility than working people to lock in deals by traveling off-season or at other unpopular times.
Don’t overlook insurance needs. Travel insurance may be appropriate if you get sick or lose luggage on a trip. Medicare is not accepted outside the US, and even within the US, you want to be sure your health insurance has you covered in the states you’re visiting.
Look for discounts and rewards. Costs for some activities are reduced for seniors. Although discounts may be modest, every dollar counts. Check to see what discounted options are available through AAA, AARP or others. Pursue smart credit card strategies that help you earn rewards: free travel or cash back on purchases. If travel is in your plans when you leave the workforce, it’s key to go beyond dreaming and do some significant preparation. Use the time you have now to set specific goals and build savings that will help make your dreams a reality
Michael W. K. Yee, CFP®, CFS®, CLTC®, CRPCTM, is a Private Wealth Advisor/Financial Advisor with Ameriprise Financial Services, LLC in Honolulu, Hawaii. He specializes in fee-based financial planning and asset management strategies and has been in practice for 41 years. Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™ and CFP certification mark (with plaque design) in the U.S. Investment products are not insured by the FDIC, NCUA or any federal agency, are not deposits or obligations of, or guaranteed by any financial institution, and involve investment risks including possible loss of principal and fluctuation in value.
Ameriprise Financial Services, LLC. Member FINRA and SIPC.
One of the great benefits of retirement is having the freedom to pursue new interests and hobbies at your leisure. For many, travel is at the top of their retirement bucket list. The key question is how to make sure your retirement savings can keep up with your travel ambitions. The following considerations can help…
All good things must come to an end, or so they say. This is the last article by this author that will appear in this publication. I wish the Generations team and readers all the best in every way.
I hope that over the past 15 years, you have gleaned from this column how important it is to have a clear, comprehensive estate plan—or, as I prefer to write it, “est8plan”. There are so many things that are beyond our control, and our est8plans can help us and our loved ones when inevitable bad things, such as death and disability, happen down the line.
Please know and live the reality that through estate planning, you can create better, if not objectively good, outcomes for yourself and your loved ones as you transition through the stages of life. Your imagination and your collaboration with competent and creative advisors will give rise to an est8plan that will help you sleep at night. You will rest easy in the knowledge that you have done everything you can to put yourself and your loved ones in the best possible position to face the future. “May the road rise to meet you” as you embark on your own estate planning adventure, and remember: an intellectual solves problems… but a genius avoids them. Your est8plan can help you and your ‘ohana avoid the problems that must be solved when people fail to plan.
All good things must come to an end, or so they say. This is the last article by this author that will appear in this publication. I wish the Generations team and readers all the best in every way. I hope that over the past 15 years, you have gleaned from this column how important…
Thinking about investing? You’re not alone. According to Gallup, 85% of Americans are actively seeking financial guidance—but BBB finds that too often, people lose money to bad advice and fraudulent “investment gurus” posing as experts.
BBB’s 2024 Scam Tracker Risk Report found that investment scams are the riskiest in North America, with the highest susceptibility rate and losses in the thousands!
With this in mind, working with a trustworthy financial advisor isn’t just smart—it’s safer.
According to Ramsey Solutions:
44% of people with advisors have $100K-plus saved for retirement, vs. 9% of solo investors.
68% of millionaires surveyed used financial advisors to build their wealth.
Working with a trustworthy professional is a difference-maker. That’s where third-party trust indicators such as the Better Business Bureau come in. While BBB doesn’t give financial advice, it does help you find financial professionals you can trust.
Read reviews, check complaint histories, identify accreditation, get multiple quotes and use BBB’s free Financial Wellness HQ tools: bbb.org/all/financial-wellness-hq.
Thinking about investing? You’re not alone. According to Gallup, 85% of Americans are actively seeking financial guidance—but BBB finds that too often, people lose money to bad advice and fraudulent “investment gurus” posing as experts. BBB’s 2024 Scam Tracker Risk Report found that investment scams are the riskiest in North America, with the highest susceptibility…
The One Big Beautiful Bill, now a law, “permanently” increased the maximum lifetime exclusion amount that any US citizen or resident can use to shelter gifted assets or assets passing at death from the federal gift or estate tax. The new estate and gift tax exclusion beginning in 2026 is $15 million per US citizen and resident. The exclusion was originally slated to be reduced to $5 million plus inflation in 2026.
“Permanent” is only permanent as long as the current administration is in control. However, the estate transfer tax system is a very unpopular tax. Consider three reasons why the federal estate tax exemption most likely will not be reduced:
1) In the past 100 years, the exclusion has only increased. In the 1980’s, the estate tax was $600,000.
2) Congress, who is in charge of increasing or decreasing the exclusion, for the most part, is made up of wealthy individuals. Would they pass a law that negatively impacts themselves?
3) The estate transfer tax feels very distasteful to so many US citizens and residents. When Frank Luntz, a wordsmith, helped then-President Bush paint a negative perspective about the estate tax, he renamed the estate transfer tax “The Death Tax.” Immediately, US citizens and residents felt it was an unfair tax. As the saying goes, “How can we ask families to visit the taxman and the grave-digger on the same day?”
The One Big Beautiful Bill, now a law, “permanently” increased the maximum lifetime exclusion amount that any US citizen or resident can use to shelter gifted assets or assets passing at death from the federal gift or estate tax. The new estate and gift tax exclusion beginning in 2026 is $15 million per US citizen…
Making financial decisions takes time, attention and energy at any age. In the case of elderly adults, it may become increasingly difficult to manage finances, particularly if their health is declining or they’re experiencing a cognitive issue. If you’re providing support to aging parents—or plan to in the future—here are some tips on how to handle the situation and prepare for what’s to come.
Don’t wait to start talking about money.
It may be uncomfortable to ask your parents to discuss their finances with you, but it’s essential that you are familiar with their intentions for future care and the plans they have in place. When you broach the subject, emphasize that you are looking for only a high-level overview so that you can have more peace of mind about your parents being well cared for. This initial conversation can help set the groundwork for future discussions.
Create a contact list.
If your parents experience a sudden change in health that affects their ability to manage their affairs, it’s important to have a game plan. If you anticipate paying bills, making insurance claims and handling other financial tasks, ask your parents for a contact list for the professionals they work with and where their accounts are held. You may need to be an authorized user or power of attorney to be allowed access to certain accounts. Consult a lawyer to talk through what permissions may be necessary for you to step in if the need arises.
Build a support network.
Talk with siblings or other trusted family members about what your parent’s possible care plan could look like. While this conversation can be tough to initiate, it’s often easier to bring everyone together while your parents are still in good mental and physical health. Discuss who can realistically provide support: in what way and at what cost. Proactively deciding who can drive your parents to appointments, manage financial affairs, care for their home and handle other tasks can help avoid a strain down the road.
Anticipate future lifestyle changes and challenges.
Even if they aren’t yet needed, explore options and costs at various assisted living and memory care services. Check your parents’ insurance policies to see if and how services might be covered. You may want to explore whether their home or yours could be modified to provide additional space or comforts, such as wheelchair access. Knowing what choices exist and how your parents feel about each one can help you make future decisions with more confidence.
Know your rights at work.
The Federal Family and Medical Leave Act of 1993 (FMLA) allows covered employees up to 12 weeks of unpaid leave to provide care for a family member with a serious health condition. Consult your employer’s human resources department to learn about their policies for employees who are caring for a parent and how to initiate a claim. Many employers have access to resources and support groups to help you manage home and at work duties.
Maintain momentum on your own financial goals.
It’s prudent to look at your finances to see how much support you could provide your parents, if needed, without jeopardizing your retirement and future health care needs. Your financial advisor and lawyer can help you take the steps necessary to feel more confident.
Making financial decisions takes time, attention and energy at any age. In the case of elderly adults, it may become increasingly difficult to manage finances, particularly if their health is declining or they’re experiencing a cognitive issue. If you’re providing support to aging parents—or plan to in the future—here are some tips on how to…
Parents have their own unique perspective on how to raise their children, and what values and lessons to instill. They also have personal beliefs about how their children should manage money.
Most parents would prefer that an inheritance serve to enrich and support their child’s life rather than replace the need to work or find purpose. However, these personal intentions often do not fit neatly into the legal documents designed to distribute assets.
A trust primarily focuses on appointing a trustee, naming beneficiaries and outlining the trustee’s powers and responsibilities. It rarely captures the parent’s hopes, values or deep understanding of their child, which should be the very foundation of any thoughtful estate plan.
Your estate planner may provide a document in which you can detail your meaningful guidance—beyond the legal framework—for your child’s guardians and trustees. In this document, you can communicate your wishes, values and insights—how you envision your child using inherited assets to develop a fulfilled, purposeful and meaningful life. It may also include a place to record important information, such as your child’s medical needs, routines and the significant people in their life. Ask your representative about this additional option.
Parents have their own unique perspective on how to raise their children, and what values and lessons to instill. They also have personal beliefs about how their children should manage money. Most parents would prefer that an inheritance serve to enrich and support their child’s life rather than replace the need to work or find…
Most people think of a last will and testament as the cornerstone of an estate plan. For most of us, however, it’s a lousy cornerstone. Your will is often simply a safety net that helps make sure your overall estate plan is going to work as it was designed.
Your will is like the spare tire in the trunk of your car. Hopefully, you will never need to use it because your assets are either in your revocable living trust or you have used other means to direct your assets to your beneficiaries so that the assets will avoid probate. But if you experience a flat along your journey, your family will be awfully glad you had the spare. Having a will provides added assurance that your wishes are going to be carried out.
A more formal name for a will is “last will and testament.” The “last” part refers to the fact that you can sign as many wills as you like during your lifetime, but only the last one you signed before your death counts. A document called a “codicil” can amend one or more provisions of your will without completely replacing it. In the age of computers, codicils are still valid, but more often, we just do a whole new will. Why use two or more documents with conflicting provisions when you can simplify and use only one?
Most people think of a last will and testament as the cornerstone of an estate plan. For most of us, however, it’s a lousy cornerstone. Your will is often simply a safety net that helps make sure your overall estate plan is going to work as it was designed. Your will is like the spare…
Social Security remains a critical component of most Americans’ retirement plans and questions persist around its long-term solvency. While the number of Social Security beneficiaries is expected to continuously grow over the next decade, payments into the program via payroll taxes are likely to slow. This dynamic is creating anxiety for many about whether they can rely on Social Security to help fund their retirement. It can be beneficial to explore the role that Social Security may have in your retirement and how to best prepare if there are meaningful changes to the program.
◆ The future of Social Security. If you have been following financial news, you may have heard industry pundits commenting on the solvency of Social Security and its ability to pay full benefits over time. Indeed, Social Security is currently paying out more than it is taking in, which many view as problematic. In May of this year, the Social Security and Medicare Trustees released their annual report, which predicts that by 2033, assets of the program will be depleted. It is expected that in 2033, the Social Security’s Old-Age and Survivors Insurance (OASI) fund will only take in 79% of tax revenue needed for benefit payments. As a result, payments under the program could be reduced by 21%.1 It’s widely expected that Congress may act to shore up the program before this happens, however there are no guarantees. Planning ahead can help shield your retirement income should Social Security be unable to fully meet its obligations.
◆ Determine the role Social Security has in your retirement plan. It is important to understand where Social Security fits into your retirement plan. For many retirees, Social Security benefits provide key supplemental income because the program alone will not provide enough income to cover all essential and desired lifestyle expenses. Additionally, each individual’s benefits will vary depending on their lifetime earnings and the age at which they begin taking distributions. If future payments are adjusted lower to make up for the deficit of flows coming into the fund when you retire, it may be wise to plan on utilizing other means for retirement income. Take some time to determine your desired lifestyle during retirement and the associated costs, so you can craft a Social Security plan that aligns with your retirement goals.
◆ Work with a financial advisor to adapt your retirement plan. A financial advisor can help determine the optimal payment plan for Social Security in your retirement. The age at which you begin taking distributions and where these distributions fit into the whole of your retirement plan is unique to you. An advisor can assist you in evaluating the variables that may impact the time at which you begin collecting benefits such as your health and life expectancy. With careful financial planning you can consider a variety of income producing investments that may contribute to your retirement security.
How Social Security programs morph and change in future is largely outside of your control, but it is important to plan for what you can. It is never too soon to work with a financial advisor to plot various scenarios for retirement based on factors that are unique to you. Ultimately, knowing you’re prepared can help you feel more confident about retirement.
Michael W. K. Yee, CFP®, CFS®, CLTC, CRPC®, is a Private Wealth Advisor with Ameriprise Financial Services, LLC. in Honolulu, Hawai‘i. He specializes in fee-based financial planning and asset management strategies and has been in practice for 41 years. Certified Financial Planner Board of Standards, Inc. (CFP Board) owns the CFP® certification mark, the CERTIFIED FINANCIAL PLANNER™ certification mark, and the CFP® certification mark (with plaque design) logo in the United States, which it authorizes use of by individuals who successfully complete CFP Board’s initial and ongoing certification requirements. 1Ameriprise Financial: “Did You Know…” May 8, 2024. Compiled by Russell T. Price, Chief Economist Investment products are not insured by the FDIC, NCUA or any federal agency, are not deposits or obligations of, or guaranteed by any financial institution, and involve investment risks including possible loss of principal and fluctuation in value. Securities offered by Ameriprise Financial Services, LLC. Member FINRA and SIPC.
Social Security remains a critical component of most Americans’ retirement plans and questions persist around its long-term solvency. While the number of Social Security beneficiaries is expected to continuously grow over the next decade, payments into the program via payroll taxes are likely to slow. This dynamic is creating anxiety for many about whether they…
