Category: Wisdoms

  • Smart Ideas for Year-End Benefits

    With the end of the year just around the corner, you may want to review your financial situation. Make a list to ensure that you take full advantage of all available tax-saving deductions. Here are some ideas for year-end planning that can benefit you and help support your favorite charity too.

    Charitable Contributions — A cash gift or an unneeded asset can provide valuable tax savings.

    Charitable Gift Annuity — Double your benefits while making a gift and receiving cash back. A gift annuity gives you income tax advantages this year while providing you with dependable payments for life at fixed rates as high as 9%.

    IRA Charitable Rollover — If Congress again passes the IRA charitable rollover this year, you may be able to transfer money directly from your IRA to a qualified nonprofit without paying federal income tax. Check with your tax advisor.

    Additional Tax Savings — Review your mortgage, medical, education, business and other miscellaneous expenses to determine if there are additional ways you can save. Check your list against your advisor’s recommendations to avoid missing any significant deductions.

    Will Or Trust Update — If you haven’t visited your attorney to review your estate plan in recent years, you should make an appointment. Your plans may need to be updated, particularly if you have experienced life changes. We offer a free “Wills and Trust Guide” to make your planning easier. Call us for your copy.

    National Kidney Foundation of Hawaii
    808-589-5976 | jeff@kidneyhi.org
    For Planned Giving: www.kidneyhawaii.org
    Main: www.kidneyhi.org | www.kidney.org

    With the end of the year just around the corner, you may want to review your financial situation. Make a list to ensure that you take full advantage of all available tax-saving deductions. Here are some ideas for year-end planning that can benefit you and help support your favorite charity too. Charitable Contributions — A…

  • Start with Why

    Lately, I’ve had questions from beneficiaries of trusts asking “why did the decedent make the trust distribution a certain way?” The trust clearly identified who the beneficiaries were, and what they were to receive and how they were to receive it. Unfortunately the trust was silent as to “why” — the underlying reason and purpose for making the trust in the first place. Failing to clearly set forth the intention or purpose in one’s estate plan can lead to misunderstanding, confusion, hurt feelings, potential law suits and disruption of family relationships.

    Clients come in to see an estate-planning attorney with clear intentions and purposes that are the foundation for establishing the estate plan.

    Unfortunately, the lawyer listens to the clients’ purpose and intention and focuses all effort on writing “what, when, and how” into the trust, leaving out the trust’s purpose and intention.

    Simon Sinek in his book, Start With Why, explains it this way: the “what, when, and how to do” come from our neocortex, our brain’s language center. The intentional and emotional purpose-driven “why” comes from our limbic brain, which has has no capacity for language.

    This is why writing the purpose, emotion, and intention is difficult. Yet, we are emotional beings, and most of what we do is driven by clear intention and purpose. Therefore, it is important to put effort into writing out our intention and purpose.

    Our estate plans are intended to be our last say, and the “why” must be expressed as the foundation for the plan.

    Stephen B. Yim, Attorney at Law
    2054 S. Beretania St., Honolulu
    808-524-0251 | stephenyimestateplanning.com

    Lately, I’ve had questions from beneficiaries of trusts asking “why did the decedent make the trust distribution a certain way?” The trust clearly identified who the beneficiaries were, and what they were to receive and how they were to receive it. Unfortunately the trust was silent as to “why” — the underlying reason and purpose…

  • Stretch Your Vacation Dollars

    Summer vacations are perfect for hitting the road for adventure or staying close to home to simply recharge. The slower pace and rest a vacation offers are priceless, but you can still practice financial vigilance. Here’s how to get the most for your money as you travel this summer.

    Consider Off-Season Tropical Destinations

    During the winter months, tropical hot spots command top dollar. But you can find bargains south of the equator during the summer months. Land a package deal to a Caribbean or South American destination and enjoy less crowded beaches and hotels in paradise.

    Dollars Go Further in Europe

    For the first time in over a decade, the U.S. dollar is approaching a 1:1 ratio with the euro. American travelers can expect their vacation budgets to go further in all 19 countries operating on the euro currency. Airfare to Europe is also less expensive this summer. If you plan to visit several countries, consider purchasing a 30-day Eurail pass and travel by train between countries for one reasonable price.

    Think Outside the Hotel Room

    Check out websites that coordinate home sharing in hundreds of countries around the world, typically at prices far below standard hotel rates. Also consider family-run pensions (short-stay boarding houses in Europe) or bed and breakfasts (B&Bs) for cheaper and more intimate lodging. If you like making your own meals (also a moneysaver), look into short-term vacation home and apartment rentals.

    Be Flexible

    If you aren’t particular about where you travel or specifically when, you can often find last-minute package deals online to specific cities or attractions that include airfare, hotel, a rental car or some meals. Compare offers and determine which provides the best value. Also, when you’re booking airfare, be flexible with your travel dates to improve your odds of landing a better price. Consider a midweek departure and return to avoid higher weekend rates. Keep an eye out for airline promotions early each week, when their sales start.

    Traveling costs money, but vacation memories are irreplaceable. If you need help planning your trip, ask a travel agent to provide information and tips for saving money on specific locales. Also, ask your financial advisor to help you budget and work toward your short- and long-term financial goals, including traveling, buying a home, saving for college and retiring.

    Michael W. K. Yee, CFP
    1585 Kapiolani Blvd., Ste. 1100, Honolulu
    808-952-1222 ext. 1240|michael.w.yee@ampf.com
    Michael W K Yee, CFP®, CFS®, CRPC®, is a Financial Advisor and CERTIFIED FINANCIAL PLANNER practitioner™ with Ameriprise Financial Services, Inc. in Honolulu, HI. He specializes in fee-based financial planning and asset management strategies and has been in practice for 30 years. Ameriprise Financial Services, Inc. Member FINRA and SIPC.
    © 2015 Ameriprise Financial, Inc. All rights reserved. File #1205686

    Summer vacations are perfect for hitting the road for adventure or staying close to home to simply recharge. The slower pace and rest a vacation offers are priceless, but you can still practice financial vigilance. Here’s how to get the most for your money as you travel this summer. Consider Off-Season Tropical Destinations During the…

  • Keeping Peace in the Family

    On May 27, 2015, Reuters reported that a Georgia judge had appointed a mediator to help the family of the late Dr. Martin Luther King Jr. decide whether to sell Dr. King’s Nobel Peace Prize and his personal Bible. Dr. King carried this Bible during the historic marches and rallies of the ’60’s, and President Obama took the oath of office on it at his second inauguration. According to the article, the “fight pits the slain civil rights leader’s sons, Martin Luther King III and Dexter King, who want to sell the medal and Bible, against King’s surviving daughter, Bernice King, who opposes the sale of items she calls ‘sacred’ to the family.”

    This family drama illustrates two important principles. The first is that a well-thought-out and thoroughly implemented estate plan will give your family priceless guidance. The second principle is that there are better places than courtrooms to resolve conflicts.

    The Benefits of Good Planning

    Putting time and effort into devising a plan with enough details to make it work effectively will pay enormous dividends for your loved ones. Putting the right managers in place, and making your wishes very clear will help your family to focus on honoring your memory and moving on with their lives. In order to work, an estate plan needs to be reviewed and updated from time to time. Things change constantly and sometimes rapidly (the law, your finances, your family, your list of trusted advisors; failing to make necessary adjustments will cause your plan to fall short.

    Mediate Rather Than Litigate

    Mediation is a way of getting disagreeing parties together, helping to find their common ground, and then working toward solutions that may not make everybody happy, but satisfy their shared goals and values. If you know that your loved ones are at odds, you might engage a skilled mediator now, to assure that the eventual settling of your estate will be done peaceably later on. If you find yourself in conflict after a loved one or family member dies, propose that your differences be mediated privately rather than hashed out in open court. Mediation saves time and money; sometimes it opens the door to heal relationships.

    Even if you don’t have a Nobel medal or a historic Bible, you can give your loved ones alternatives to shooting it out in court over “who gets what” or which heirloom gets sold. You may not be able to make everybody happy with your estate plan or with the assistance of mediation, but you can head off or minimize problems that may tear your family apart and tarnish your legacy.

    Scott Makuakane, Counselor at Law
    Focusing exclusively on estate planning and trust law.
    Watch Scott’s TV show, Malama Kupuna
    Sundays at 8:30 pm on KWHE, Oceanic channel 11
    www.est8planning.com
    808-587-8227| maku@est8planning.com

    On May 27, 2015, Reuters reported that a Georgia judge had appointed a mediator to help the family of the late Dr. Martin Luther King Jr. decide whether to sell Dr. King’s Nobel Peace Prize and his personal Bible. Dr. King carried this Bible during the historic marches and rallies of the ’60’s, and President…

  • Who You Gonna Call? Scambusters!

    In the movie Ghostbusters, when someone needed help with anything paranormal (ghosts, demons … or maybe even night marchers), there was only one number to call — Ghostbusters!

    Unfortunately, when a person suspects fraud or financial scams going on, there are a variety of agencies that handle different aspects of this dishonest behavior. As we discussed in the last issue of Generations Magazine, if you suspect elder abuse is occurring, call your local police department; for immediate emergencies, don’t hesitate to dial 911. But if you suspect fraud, there are other agencies you may call:

    Charity Division of the Attorney General — 808-586-1480: This division will look up a charity and indicate whether it is licensed. This service is a big factor in determining if the charity is real.

    American Institute of Philanthropy — www.charitywatch.org: Here is another resource that monitors charities and if charitable donations are being put to good use.

    DO NOT CALL Registry — 888-382-1222 or www.donotcall.gov: This helps reduce phone calls from legitimate businesses (unfortunately scammers can still call saying you won the lottery). And solicitors from charities and politicians will still call you.

    Direct Marketing Association (DMA) Mail Preference Service — 202-955-5030: This number removes your name and address from prospective mailing lists to decrease the amount of junk mail you receive from them.

    Opt Out Prescreen.Com — 888-567-8688: This number will allow you to “opt-out” of getting offers for preapproved credit cards and insurance deals. This decreases junk mail and the risks of having your mail stolen and someone opening up a credit card in your name.

    Medicaid Fraud & Patient Abuse Unit — 808-586-1058: This is a department within the Attorney General’s Office that investigates abuse of dependent adults committed by Medicaid providers, care facilities and paid caregivers.

    Long Term Care Ombudsman — 808-586-0100: This department investigates and resolves complaints about the care or services provided in long-term care facilities, including nursing homes, adult residential care homes, assisted living facilities and community care foster family homes.

    Consumer Resource Center — 808-587-3295 or 808-587-4272: This agency handles complaints against merchants and licensed professionals, and one can call them for license verification and complaint history of professionals or businesses.

    Hawaii Internet & Technology Crimes Unit — 808-587-4111: This unit within the Attorney General’s Office investigates and prosecutes computer-facilitated crimes. Call this department if you fall for a dishonest email or an Internet scam.

    Office of Consumer Protection — 808-586-2630: They review, investigate and prosecute allegations of unfair or deceptive business practices.

    Financial Crimes Unit — 808-723-3609: This unit within the Honolulu Police Department investigates telemarketing scams, investment frauds and various other white collar crimes.

    U.S. Postal Inspection Service — 877-876-2455: This department investigates crimes that use the U.S. Mail, the postal system or postal employees.

    Be safe and visit our office’s new elder abuse channel on www.youtube.com. Search for “Elder Abuse Hawaii” to watch videos on elder abuse.

     

    To report suspected elder abuse, contact the Elder Abuse Unit at:
    808-768-7536 | ElderAbuse@honolulu.gov
    www.ElderJusticeHonolulu.com

    In the movie Ghostbusters, when someone needed help with anything paranormal (ghosts, demons … or maybe even night marchers), there was only one number to call — Ghostbusters! Unfortunately, when a person suspects fraud or financial scams going on, there are a variety of agencies that handle different aspects of this dishonest behavior. As we…

  • A Conversation About Life

    This past year, our office established the Heartfelt Legacy Foundation™, which in turn, purchased the right to associate with Honoring Choices®. This national group is raising awareness about making end-of-life choices, encouraging family discussions so that loved ones’ choices may be honored and respected.

    In the coming months, Honoring Choices® Hawaii plans to bring awareness to the Hawai‘i community by providing free seminars, engaging community leaders and training advance care facilitators to engage in planning with individuals to begin the advance care planning dialogue.

    In order to bring to the Hawai‘i community a uniform, systematic, normalized process, we look for everyone’s support. Honoring our loved one’s intentions at the end of life, to me, is such a universal desire, that it transcends cultural, economic and social differences; the conversation resonates with every individual.

    What’s at risk if we do not engage in these conversations? Needless suffering by the individual and their family members; unknown intentions and choices that cannot be honored and respected; dying in an isolated and lonely place surrounded by strangers (caring strangers, but strangers nonetheless). Stress and guilt, felt by surviving family members, can linger a lifetime.

    You will hear more about Honoring Choices® Hawaii. Right now, we can all help by starting the conversation with our own families.

    _____________________________
    Stephen B. Yim, Attorney at Law
    2054 S. Beretania St., Honolulu
    808-524-0251 | www.stephenyimestateplanning.com

    This past year, our office established the Heartfelt Legacy Foundation™, which in turn, purchased the right to associate with Honoring Choices®. This national group is raising awareness about making end-of-life choices, encouraging family discussions so that loved ones’ choices may be honored and respected. In the coming months, Honoring Choices® Hawaii plans to bring awareness…

  • What Legacy Will You Leave?

    You may be surprised to learn that an estimated 70 percent of American adults have not yet made a will or trust, even though these documents are vitally important to all individuals and families. For those who never complete their estate plans, the government will apply a series of laws that may or may not be what is desirable for the families or heirs.

    You may also be surprised to learn that those who check out planned giving as part of the will and trust process often discover opportunities that not only help their favorite charity, but also provide added benefits for themselves and their families. Even those who already have made plans may find that working with a qualified charity can provide additional benefits they never knew were available.

    Years ago, when I was a estate planning lawyer, I discovered that people would approach this subject with foreboding, only to end up feeling good and relieved after completing their plans. Many of them actually enjoyed the process, and the peace of knowing their lives were in order and their families were better off for the planning.

    National Kidney Foundation of Hawaii is offering a free “Wills Guide” packed with helpful information to consider before making an appointment with your attorney. It is our way of encouraging you to take the first step towards leaving your legacy. Should you like a free copy, please call me at 808-589-5976 or send an email requesting the guide to jeff@kidneyhi.org.

    National Kidney Foundation of Hawaii
    808-589-5976 | jeff@kidneyhi.org
    For Planned Giving: www.kidneyhawaii.org
    Main: www.kidneyhi.org | www.kidney.org

    You may be surprised to learn that an estimated 70 percent of American adults have not yet made a will or trust, even though these documents are vitally important to all individuals and families. For those who never complete their estate plans, the government will apply a series of laws that may or may not…

  • Real Property Tax Credits for Homeowners

    Property owners who meet certain eligibility requirements may apply to the City and County of Honolulu for a real property tax credit to reduce their property taxes. Depending on your age, you may qualify for a tax credit equal to the amount of taxes owed for the 2015 and 2016 tax year that exceed 3 or 4 percent of the total of the titleholders’ income. For homeowners 75 or older, the rate is 3 percent. If approved, the tax credit will be applied to the July 1, 2016 –June 30, 2017, tax year.

    What are the eligibility requirements?

    • Homeowner must have a home exemption for the 2015 and the 2016 tax years.
    • Titleholders of the property cannot own other property anywhere.
    • The combined income of all titleholders for the 2014 calendar year does not exceed $60,000.

    How do I apply for this tax credit?

    Applications are available at:

    Applications must be filed by Sept. 30, 2015, and must be filed annually. For further information, please call 808-768-3205.

    *Information subject to change without notice.

    Tax Relief Office
    808-768-3205| bfstreasmailbox@honolulu.gov

    Property owners who meet certain eligibility requirements may apply to the City and County of Honolulu for a real property tax credit to reduce their property taxes. Depending on your age, you may qualify for a tax credit equal to the amount of taxes owed for the 2015 and 2016 tax year that exceed 3…

  • Estate Planning for College Students

    I recently received a call from a client who has a daughter attending college on the Mainland. Her daughter had been in a ski-accident and was in the hospital. When the mother called the hospital to find out her daughter’s status, they would not release any information or allow the mother to make any decisions on her daughter’s behalf. You can imagine the mother’s distress, thousands of miles away and helpless.

    This situation is all too common. Once your child reaches age 18, you are no longer entitled to see your child’s medical and financial records or make decisions on their behalf. Therefore, it is important for young adults to appoint trusted individuals to make medical and financial decisions in the event they are unable to do so.

    Few 18-year-olds consider the need for an estate plan, because most have little in the way of property. But if your child were to suddenly lose the ability to make or communicate decisions, they would need a an authorized person to make decisions for them. Your college student will want to consider two important Powers of Attorney:

    An Advance Health Care Directive gives you the ability to act on your child’s behalf with regard to medical decision-making in the event that your child is unable to do so.

    A General Durable Power of Attorney gives you legal authority to act on your child’s behalf regarding financial matters, regardless of whether they are able to make decisions on their own or not. It may be used in matters of both emergency and convenience.

    Stephen B. Yim, Attorney at Law
    2054 S. Beretania St., Honolulu
    808-524-0251 | www.stephenyimestateplanning.com

    I recently received a call from a client who has a daughter attending college on the Mainland. Her daughter had been in a ski-accident and was in the hospital. When the mother called the hospital to find out her daughter’s status, they would not release any information or allow the mother to make any decisions…

  • Gifts Anyone Can Afford

    Sometimes I am asked by people how they can help our cause without disturbing their finances. Surprisingly, there are ways to accomplish that goal. Each situation is different, so consulting your tax advisor is a good idea. You may wish to consider these ideas:

    •  Designating a charity as a beneficiary in your will or trust is a simple way to commit to a cause you believe in, without affecting your cash flow during your lifetime. Additionally, it’s easy to revoke this type of gift, if your situation or goals change.

    •  Naming a charity as the beneficiary of an IRA or other retirement plan, financial account, annuity or unneeded life insurance policy is another easy way to help while you continue to benefit from these assets during your lifetime.

    •  If you own low-interest assets like bank Cds, you may donate them to charity and receive a Charitable Gift Annuity with an annual payment to you, often with a higher interest rate.

    •  Real estate you no longer need or wish to sell may be given to a charity without impacting your cash flow. You may also benefit from capital gains tax avoidance, while receiving a tax deduction for the gift.

    •  If you own your home and wish to remain living there, you can transfer your home to a charity, while retaining the right to use the home during your lifetime. You may even enjoy the added benefit of an income tax deduction while you live in your home!

    National Kidney Foundation of Hawaii
    808-589-5976 | jeff@kidneyhi.org
    For Planned Giving: www.kidneyhawaii.org
    Main: www.kidneyhi.org | www.kidney.org

    Sometimes I am asked by people how they can help our cause without disturbing their finances. Surprisingly, there are ways to accomplish that goal. Each situation is different, so consulting your tax advisor is a good idea. You may wish to consider these ideas: •  Designating a charity as a beneficiary in your will or…

  • Another Option: Reverse Mortgage

    Many families worry about the financial future of their retired parents. For peace of mind and the well-being of your parents, it’s important to talk with them about the kind of financial help they may need to “age in place.” Most people want to live out their years in the home they have lived in for many years, a place full of memories and familiar surroundings.

    If your parents are 62 or older, it may be helpful to learn about reverse mortgages, a strategy that offers many options, including aging in place, help paying bills, funds for home improvements or travel, or financial means to help children and grandchildren. If you have heard about the reverse mortgage financial loan program from someone other than a professional loan officer, you may not have all the facts.

    Reverse mortgage programs turn a portion of home equity into cash, which is then paid to the borrower either as a lump sum, in fixed monthly installments or as a credit line. Eligible homeowners ages 62 or older continue to own and live in their home until the last spouse passes on. The loan is not repaid until the borrowers leave or sell the home. The amount of the mortgage depends on the age of the youngest spouse, the home’s market value, and the specific reverse mortgage program and interest rates. You can see that a reverse mortgage program for your neighbor could be very different from yours.

    During the program, which lasts as long as the borrowers live, they are still responsible for paying property taxes and homeowners insurance, and keeping the house in reasonable condition; recent programs even have options to set aside funds for property taxes and homeowners insurance, if necessary.

    Ask a reverse mortgage specialist to explain exactly how a program can help your parents live better today and be more prepared for the future. Sometimes a reverse mortgage is the one option that will allow your parents to stay in their favorite home for life. Planning and looking at all options allows you and your parents to choose what they want to do, instead of leaving their future up to chance.

    For a free workbook for families on Aging in Place or to attend a free educational workshop, call: 808-234-3117.

    ______________________________

    Percy Ihara, Reverse Mortage Specialist, NMLS# 582944

    Mahalo Mortgage, NMLS # 317240

    808-234-3117 | email: percyihara@mahalomortgage.com

    Many families worry about the financial future of their retired parents. For peace of mind and the well-being of your parents, it’s important to talk with them about the kind of financial help they may need to “age in place.” Most people want to live out their years in the home they have lived in…

  • Paying for Long-Term Care

    According to an article published in the Wall Street Journal on May 14, 2012, if you are married and you and your spouse both reach the age of 65, there is a 70 percent probability that one of you is going to need long-term care. As if that is not troubling enough, a great many of us are completely unprepared to pay the cost of long-term care. Skilled nursing in Hawai‘I can easily top $8,000 per month. How do people handle that?

    For those of us who are not incredibly wealthy, one approach is long-term care insurance. You should talk with an insurance agent who focuses on the complexities of long-term care insurance before you plunk any money down. The older we get, the odds of being insurable decrease, and the premiums get higher. The bottom line is that the sooner you look into long-term care insurance and get your policy in place, the more likely you will be able to afford the premiums.

    An alternative to insurance is Medicaid. It goes by different names in different states (Hawai‘i’s version is called MedQUEST), but it is run jointly by our federal and state governments. The federal government sets the overarching rules and provides funding. States are allowed to adopt their own rules for qualification and enforcement. Think of it as government nursing home care insurance for those with limited financial resources.

    Medicaid is “means-based.” Having too much income or too many assets will disqualify a Medicaid applicant. However, having “assets” is not the same as having the money to pay for care. Those undeveloped lots in Nevada that you own, are assets, but they may be impossible to sell.

    For those with assets exceeding the Medicaid limits, giving assets away may disqualify them from Medicaid assistance too — if the transfers violate the “look-back” period designed to keep people from gaming the system. Of course, a kupuna might have had innocent intentions when making a disqualifying gift — before the need for long-term care arose. Regardless, any gift (even charitable) is a red flag on Medicaid applications.

    Each state takes a different approach; it is easy to run afoul of the rules and be disqualified from benefits. The good news is that knowing the rules can help you plan for a worst-case scenario where you or a loved one might need assistance with long-term care costs.

    Another critical consideration is that Medicaid may limit your options for care facilities or quality of care. So we should not all assume that Medicaid is the best option for us or our family.

     

    Scott Makuakane, Counselor at Law
    Focusing exclusively on estate planning and trust law.
    Watch Scott’s TV show, Malama Kupuna
    Sundays at 8:30 p.m. on KWHE, Oceanic channel 11
    www.est8planning.com
    O‘ahu: 808-587-8227 | maku@est8planning.com

    According to an article published in the Wall Street Journal on May 14, 2012, if you are married and you and your spouse both reach the age of 65, there is a 70 percent probability that one of you is going to need long-term care. As if that is not troubling enough, a great many…