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So far Lupe Camargo has created 19 blog entries.

Understanding Probate

understanding probateAn individual’s will designates how personal assets should be distributed to beneficiaries upon death. A revocable trust enables the smooth transfer of those assets. Without a trust, if assets are titled solely in the decedent’s name, the estate must be funneled through the probate court. Understanding probate can go a long way in alleviating stress during an already difficult time.

Probate is the court-supervised process that transfers assets of someone who has passed away to the rightful beneficiaries. Depending on the complexity of the estate, the process can last roughly six months to two years. There are financial costs associated with probate, such as attorney and appraisal fees. These expenses can be hefty depending on the size of the estate.

Understanding Probate

Here are the typical steps of the probate process.

1) A petition is filed to open probate and a personal representative is appointed by the court.

Even if an executor was named in a will, before probate can begin that person must be authorized by the court. Executor, administrator and personal representative are different titles used to describe the person who will be managing the estate.

2) Notice of the death is given to potential creditors.

Any claims against the estate must be presented to the executor; there is typically a time limit within which a claim can be made.

3) Assets are collected and valued.

The executor needs to take inventory of and properly appraise the decedent’s assets before determining how and to whom they will pass.

4) The estate is managed by the executor.

This process includes opening an estate checking account to pay bills, maintaining investments and real estate, and filing appropriate income tax returns.

5) Remaining assets are distributed.

Once debts, expenses and taxes have been paid, the executor must distribute any remaining assets according to the decedent’s will. In the absence of a will, assets are distributed according to the state’s probate laws.

 

By |2019-09-16T19:35:29-07:00September 23rd, 2019|Estate Planning|

Assessing Life Insurance Needs

Assessing life insurance needs is part of estate planning.No one wants to think about their death and how it will impact others. But, if you have anyone in your life who depends on you, you must think about it. While you can’t ease the emotional burden of your loved ones when you die, you can help alleviate their financial burdens. An important part of the estate planning process is assessing life insurance needs.

Everyone’s situation is unique; and different types of life insurance policies meet different needs. Is your salary the main source of your family’s income? Are you a stay-at-home parent or caregiver? Do you have a child with special needs? Are you a small business owner? Have your children grown and started their own families?

This information from Nerdwallet.com demonstrates how life insurance funds can help in different scenarios. It can:

  • provide income replacement, so that your family can continue to pay everyday expenses;
  • cover the cost of paying for services the stay-at-home parent does for “free,” such as child care and home cleaning;
  • fund a trust, to ensure a child with special needs will have life-long financial support no matter when a parent dies;
  • cover mortgage payments, student loans or other debt, so your family won’t inherit debt or be forced to move;
  • fund a buy-sell agreement that allows a business partner to buy out your share;
  • provide a supplemental source of income for someone who has maxed out other retirement plans.

Term life lasts for a specific number of years and can be purchased, for example, to cover your mortgage or other debt. If the term expires before you die, there is no payout. Whole life and other types of permanent life insurance policies usually include a “cash value” account that builds value over time. This could help during retirement, if needed.

Assessing Life Insurance Needs

If you haven’t reviewed your life insurance in the past few years, schedule an appointment with your financial planner to help make sure your needs are being met.

By |2019-08-14T13:59:45-07:00April 23rd, 2019|Insurance|

End of Year Checklist

Lupe Camargo offers a financial end of year checklist for review.Where has the year gone? Throughout the year we have several ways to help lower our tax bill and save more money. Although most of the year is behind us, there is still time to take advantage of some things that can help put you ahead. Take a minute to review this end of year checklist.

Maximize retirement account contributions.

How much more can you save before year-end in your IRA or company retirement account? Traditional and Roth IRAs have a limit of $5,500 with catch-up contributions of $1000 for those over age 50. The 401K contribution limit is $18,500 with a catch-up contribution of $5,500. These extra contributions may push you into a lower tax bracket, so it’s worth evaluating.

Don’t miss your Required Minimum Distribution (RMD).

At age 70 ½ you are required to withdraw at least the required minimum distribution from your IRA or face a steep penalty. Remember the option of doing a Charitable IRA Rollover. This allows individuals to use their RMDs to make a direct transfer of up to $100,000 per year to qualified charities without incurring federal income taxes. Remember though, because taxes are not taken out when you complete a Charitable IRA Rollover, these funds may not be listed on your tax return as a charitable contribution.

Spend your Flexible Spending Account (FSA) money.

Is there money left in your company FSA? Use it before the end of the year, or lose it. Buy those glasses, or get the dental work done, before the money disappears.

Capitalize on tax-loss harvesting opportunities.

At Perspective, we regularly review portfolios for tax-loss harvesting opportunities. This helps to offset taxable capital gains you have had throughout the year by selling investments that have lost value.

Review your spending.

Are you confident you know where your money is going? Begin the process of reviewing your statements and identifying opportunities to save more. By focusing on what you can control, you can help kick off 2019 in the right direction.

By |2019-08-14T13:59:47-07:00December 3rd, 2018|Financial Planning|

Plan for Bittersweet Life Transitions

Lupe CamargoIt’s true. One day you’re holding a baby in your arms, and then the next you land where I am today – watching your child walk across the stage at her high school graduation, and entering into a new chapter of her life away from home. It does feel like a flash. How do you plan for bittersweet life transitions like this?

Reflecting back, there were many choices made along the way that helped create a path paved with options for her future. So much planning and preparation is required in raising a child. Ultimately, it is how we use resources under our control that can increase the likelihood of creating opportunities down the road for our child. Those resources include our energy, care, time, money, skills and experience. Success can come when all of these resources are carefully balanced.

The Next Stage

As I think about this next stage in life, I am delighted to see my daughter become a kind, independent and mature young woman. When that bittersweet moment arrives as I drop her off at college, I hope she remembers these life lessons my husband and I have imparted to her:

Only spend what you have. Living on modest means early on will give you freedom and options later.

  1. Be grateful for what you have and, for those things you have, use them wisely.
  2. Success is not measured by status or what car you drive. It is determined by who you are, how you treat others, and how you lead your life.
  3. Pay attention to the things that matter, and don’t get distracted away from your goals.
  4. You are part of a community, so remember to always give back and support those in need.

Shifting from an active participant to a spectator in her life will be challenging; however, I trust she is ready to handle what life throws her way.

I also share with her three things that I have always carried with me, and hope that she carries them forward as well: Be brave, be wise and be kind.

By |2019-08-14T13:59:49-07:00May 21st, 2018|Financial Planning|

Year-End Tax Saving Strategies

Lupe Camargo, financial plannerNow is a perfect time to check for any remaining opportunities to help minimize your tax bill before 2017 comes to a close. There are many year-end tax saving strategies for you to consider.

At Perspective Financial Services, we take a proactive approach to minimize our clients’ tax bills through a variety of investment strategies. Selling a security in a taxable account at a loss and replacing it with another security of the same asset class can help offset some of your capital gains tax; this is referred to as tax loss harvesting. We also research mutual funds that may generate a capital gains distribution before making end of year purchases; this helps avoid unnecessary capital gains taxes on new investments.

There are additional things you can do, with the help of your financial planner. Here is a checklist of things to think about.

When possible be proactive about the timing of your income. This can make a significant impact on your tax bill.

  • Defer a bonus or a sale of appreciated property to the following year when it becomes advantageous to avoid the income this year.
  • Pay expenses this year, such as fourth quarter state income taxes or medical expenses. This helps especially when next year’s income will be less than this year.
  • Increase your federal income tax withholding to soften the blow of a significant tax bill.

Take advantage of the vehicles that not only help you plan for the future, but give the added bonus of reducing your income taxes.

  • Max out your IRA contributions, and take advantage of the catch-up if you are over 50 years old.
  • If you are over 70 1/2 years old, or you have an inherited IRA, do not forget to take your required minimum distribution. The penalties are very steep if you do not.

If you are planning to gift money to family or charities, do so before the end of the year.

  • Give $14,000 per individual annually in federal tax-free gifts.
  • Make planned charitable contributions and take advantage of the charitable rollover provision if you are over 70 1/2 years of age.
By |2019-08-14T13:59:51-07:00December 4th, 2017|Advisors, Charitable Giving, Taxes|