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KJCE 1370AM>Audio on Demand>>WorthPointe Wealth Watch Podcast 4/6/14

WorthPointe Wealth Watch Podcast 4/6/14

Apr 6, 2014|

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Automatically Generated Transcript (may not be 100% accurate)

And for -- war point will watch with Christopher -- -- Partner and founder of worst point so we'll see. Tired of the same sales pitches disguised as financial advice -- is a certified financial plan. Real facts about investment. This state my. Good afternoon Austin, Texas his first prevents. Like you're listening to the -- point well watch where we give you a peek under the hood of the wealth management Ferrari. Today I'm joined in studio by Scott O'Brien good afternoon everybody and Justin -- off hallowed ground. Who's back for another show thanks for having me and saying he is an estate planning attorney and expert. Who practices here in Austin and go today organ. We're gonna get into what we call advanced estate planning we did basic estate planning last week. And but we like start off with a new the news item of the day. With he's got a -- Did you notice the 25 anniversary of people magazine's fifty most beautiful people. Were you on that list I have never been there. Yet did when you're younger and the head of anybody who has done a good do you remember -- the first one wants. This is a really trivial question news just in its -- since when he -- your -- Brooke Shields. That's good good guess but no. Christie Brinkley and Michelle Pfeiffer I was the first one. You know you're in Southern California -- in 1990. No you know Yemen may have nine EQ did you ever meet -- like -- -- I've met a lot of movie stars because they were lined up outside my door my little apartment there and was telling them. Yeah and come but she is -- wanna -- yeah very -- at the well what's interesting is. And I'll come around this with the this story is that when she had the article or -- magazine covers and what what is the shelf life -- need a nominee that's it absolutely nothing because she was so beautiful. And still is but they actually found a and it -- among the memo from the photography re touching company. They had this deep -- they need to clean up the complexion into an -- picture clean up the complexion soften her byline softer or smile line. Add color to her lips -- chin softened a line under your -- an ad here too little is known for the rest isn't she got that -- -- Yeah our radio and also subtly bring that up only guys who I was -- -- related to win and when sometimes we have investors say why didn't you guys. And the perfect portfolio last year and which would have meant really we just had a US stocks last year and we would have any bonds or any real Stater any emerging markets and and I just think if Michelle Pfeiffer isn't. She's not persecuted if your portfolio -- include. But she's not unhappy and you shouldn't be either yeah. Right -- fact they handled the list of all the the guys -- all the big firms who made their target tourists and 500 for 2013. And they were off an average of fourteen. An average of 21% they're off on their projections for the S&P 500 last year. The turnaround going from fourteen point 4% to one company was off 33 saying people can't predict the future and saying that. Not even speaking at let me just I have to say I just came from. Speech over and Austin country club the financial planning suspicion. And that's the speaker was from UT Inco which is the university of taxes investment fund into -- and -- the fund that was left by the legislature a long time ago. Which benefits UT and. And hand them and their two thinks the guy said one is that. They have a 25%. Chance of picking a manager. Who will outperform the market. 25%. Chance he admitted that. The unthinkable. What is continue to do -- the path into XX. Yeah you said I asked him point blank as it what's the expense ratio of the fund the 32 billion dollar fund. He says eight basis points. Now they have 13 of the fund and hedge funds. -- two and twenty -- so how can have -- eight that point 08%. Folks you know you know you'd you can get an index fund that has that expense ratio. So like how can you put a third of the money in hedge fund. And two mobile expense -- like and I said now are the hedge fund fees in that number. He says no that we get their performance reported net of fees. Mike you just under I think your pin over and over 1% on 32 billion dollars -- That's your that's your money. Folks and they've been they've done studies that show that -- that the pension funds of course held outraged when they have all kinds of consultants that tell them to service steer them towards different managers and they found that. That. The years the years after they fire the guy that wasn't performing well is when they start doing well so there's endless circle of help me they claim though that they don't do that they don't even though they chase returns they say that there of the one entity on earth the business subject to the problems related to chasing Richard. He put up a chart of the U Tibco fund. Vs the -- fund. -- starting in 2000. Ours has grown half as much as these things and I'm like and why haven't you been fired. Blake I bet my index fund portfolios that perform this any you know obviously the answer is if the markets are efficient and it's not. In a really good use of your time to try and pick managers. What do we need to staff for turnover at the provinces. If it if they're objective I think they have to find themselves. Anyway I'm that's not the topic today Israel. Intelligence -- the -- one thing we forgot to address last week Justin is that the prevalence of these online. Tools were making your own will there. I've heard people say well it's better than nothing I'd say sometimes it is but what are the problems -- why don't -- -- everybody to go to -- I can and do heroes and the state park. You know -- -- -- through the process we have we wanted to see what if what it looks like to get through that Tom and the I will say the documents that are generated -- -- bid documents on the problem with that is that and attorneys. Product is truly advice and counseling goes along with -- it's not that it's not the pages of your Weller draster what documented this. So things like are you sure you wanna cut your son out of the well because here's how your other son is gonna feel about that after you're -- variety. -- or or wisdom that the explanations that go along with some of the elections are a little bit hazy do a layperson -- second marriages would be second marriages issues that's exactly how does these habitats that key issue to our second marriages in Australia. Chances and there are ways to handle on the on -- it is playing. But it's not yours no attorney involved and that's and I and I am an attorney -- you're saying that but. It's say it's an incomplete processing in any -- can lead to -- to bigger problems. Began. But I thought of I tweeted this the other day you by the way folks -- can finest. On Twitter Linkedin and FaceBook. By searching for four point. I tweeted a self. A self directed brokerage account account is like it do it yourself surgery center -- the fact mathematically. And I think doing legal work for yourself or the website is kind of the same thing. I mean. It's just so important that can you can you afford to make a missile. 11 common I didn't make our last show is that this is an incredibly -- advisor driven air aloft right. So when you. We knew our self directing yourself in the legal world is well. You kind of may have a warm and Fuzzy as you put that well on your shelf and you think you're taking care of and you're not gonna know if it's not right and tell you into these guys who blows up Tom. But that that doesn't make me feel good as an attorney or thousand. They share your state. Death just. Just take that thumb for what it's worth folks weren't we're not attorneys we don't care if he's web search their attorneys sure but. But I personally don't use a website and I just want to think long and hard boat that can really do for him. When we come back ladies and gentlemen we are gonna get more into advance estate planning we're gonna talk about things like dynasty trusts. The get it -- -- the state. And so forth I don't know whatever whatever just that comes up that we'll see it. Between ramping government spending and uncertainty about our economic future most Texans are having doubts about their own financial future. Are you ready to take a serious look at your financial goals using the experience the only certified financial planner practitioner is it worth point. Would you like a second opinion on your current advisor who may be selling you investments and insurance for commission's -- -- when he radioed I've come to make an appointment or call 8885447760. That's worth point radio dot com 8885447760. Welcome back to work quite well -- -- giving you an unbiased people under the hood of wealth management investment and financial planning. Once again here's Christopher advanced. -- Welcome back off. This is Christopher rants like in your listening to the war went -- watch. We are in studio today. With wealth advisor Scott O'Brien and attorney Justin Blum off -- There was an estate planning specialist and obviously a natural on radio I think he's very have his -- -- get a table he's gonna take that only dry food is gonna take a break. But it's gonna take that morning drive -- this -- got -- -- yeah. The video a over the break we did what we're not supposed to do and we started chatting about the topic which lets air out of the topic cup but we stop ourselves in time to. To get something done here in and I kind of -- Justin's interest by bringing up. You know. Should you leave. Any amount of money to people out right before or should it be held in trust for their benefit sure. Knew there are tax advantages to that there are asset protection advantages. To that and -- advantage is just in terms of the ultimate objective which is to help your family -- at the console would. What's your experience -- that. How many you know the idea and what we muscular used to about leaving assets to to -- The old fashioned method which I -- fashion now that even with one that long ago that you -- -- somebody at thirty -- and they come out of the trust now -- -- -- -- it usually between 530 and 35 tracks on the third -- -- wherever. Well you know that's that's kind of been swept away wasn't that Smart I was. Exactly I've gotten a foreign -- donated 5560. -- that's that's you know protecting the beneficiary from themselves right -- but there's always other indeed protections from external sources a liability so you leave assets to somebody and it. It -- they come out of trust -- that 35. We'll winner people getting into more and and creditor issues that's when they're bound their businesses and at the borrow money and that's where critter shop and trust. For the most part these types of Dresser protected from creditors. Com what are people getting divorced and they're not getting -- -- may get divorced in their twenties if you were getting divorced so why take gases that are otherwise. Not and general otherwise exempt from creditors in divorce and all these things and and just laying them out there on the table now there -- subject to all those things. Nothing I just a lot of it is this the effective of money in inheritance on her motivation and achievement absolutely and I don't I don't know you know I didn't. I don't work really hard right my twenties and early -- race then I don't think I would've worked as hard if I knew that I had a lot of money coming to me through an inheritance we see that would. Warren Buffett and Bill Gates there and given all the money away or not not all limits go get the -- some money into -- you're going to get fifty million yeah. We still. They still at least trying to give them some some -- debate they set up charities right the toughest kids in the two run. The end it did that. Trust playing trust in general is aware that kind of scares a lot of people and it sounds like at some things locked up and there's no access to a -- -- -- Incredibly flexible tools he can do whatever you won't with and that's what I touched on our last time we spoke as well as that that's soft side of planning. On these are very sophisticated tools we use that you can really work with your clients through these issues what was sort of things do you want your your Stanley to achieve with this money source of some salaries. What are some stories you can cure this where people didn't use these kind of techniques -- and their state plan caused problems come possibly comical problems in the yeah people are probably about probably. -- a terribly tragic or Compaq portable a couple of. Found it did tragic ones you know. And -- happening in our firm more where we're going through this process and planning it probably would appropriately with these clients. Where they're where worry look kind of laughing back at you coming in after the fact sometimes an up and clean up a situation where the -- share share. Com but it happens in portfolio management under the salary we have a lot there's one laid out -- -- but the other times you when you can see the tragedies that would have happened had we not -- appropriately. And and there are there external thing god we've left the outlets of divorces how -- we left our money this is Ian Suzy married this guy with a great guy. And then at some that didn't work out absolutely and and on top of that what of what about the ones who we did leave it and trust. And -- still married to this great guy but his great guy recognizes there's interest there and wants to be able to start tapping into that firm -- other business. I'm investments and seven and if it's set up appropriately by the parents for the children then. And we're not we're not removing the ability to uses assets that we are taken back control when training wheels. You got he got it I think that makes a lot of sense Scott yeah I as -- -- think of case were to win. Terribly bad but I never really haven't had that in my in my practice but. A little easier so darn good analysis you know it's just not me it's the experts say we're doing just that there's nobody in the affirmative problem he's got good company bulletins that well it's funny because I have these conversations with good to be perfectly good it's. He's -- and I -- what would -- and things that could've been brought to my attention. Hey it. That's what I do I bring -- the wheel because people like to have his conversations or less nearly so I think that's not gonna happen to me and that's not a happy dolls. Also this it's it's. Our clients that we've had that have run into really bad situations unfortunately been a really small states because they had he didn't have the resources to go. Through the process before we met them. And now you're you are having. A mother -- his son died and she's arguing with the -- boyfriend over his. His underwear and televisions right because there was a proper planning and place. That the biggest states that a Mars we've we've. Appropriately plan forms -- good shape and you can see what sort of issues would have come up. But we've we've been able to mitigate this thing goodness all right we're gonna go to break. We're here with attorney Justin Blum off and we are we're talking about advance estate planning when when we come back I'm announced just and to give as the top three in the mistakes people make show it's -- yeah yeah. We'll see -- don't come back yeah. I don't know I can figure within. -- and. Mom. It. Are you ready to take a serious look at your financial goals using the experience the only certified financial planner practitioner is it worth point. Would you like a second opinion on your current advisor who may be selling you investments and insurance for -- is it worth when he radioed I've come to make an appointment or call 8885447760. That's worth point radio dot com 8885447768. Welcome back to work quite well watch giving you an unbiased people under the hood of wealth management. Investment and financial planning. Once again here's Christopher advanced. -- and welcome back Austin, Texas this is -- for events like we are joined in studio by Justin Blum off. Who is in the state planning specialist attorney here in Austin stand -- we're talk about a van advance estate planning this is just a second showed us. It's just going to grade kind of you know like it is an -- question popped in my mind and during a break is don't think we've asked to get. Last time Iran in this time isn't it how often should someone. Review their documents. In the answers it depends how they're getting another lawyer -- depends if it's something that's been getting -- -- Recommend looking in just pretty share designation to your executor or -- trustees every three years or so. Com and then re making sure you actually revisit these -- structure of your planned it out from winning certain life event takes place divorce. -- that's one thing more than -- financial advisor can help absolutely. What -- what I know about your business and our businesses that we speak to people on a regular basis because where it we have the money. You know so we're talking quarterly write you know. And that's -- that's a good time for Scott you know when you're chatting declined your clients as you know might my daughter got married and I'm really concerned about the guy she married -- being being being being you know you know. What we might one day to give Justin call. And just look at how things are set up step by -- The red -- here because we elvis' planners we keep track of what we talked. For a different previous -- we talked to and our quarterly reviews really reviews and say gee we talked about doing a state plane -- Talking of anybody if we if we don't know what's happened and not quite find their clients are all reluctant to do it they appreciate the fact I. Keep on top on -- they eventually did Carlos the time again we we lean heavily on the does the advisors in the financial world we have. It's just where we are it's just it's the business yeah absolutely. Com so before the break just -- I ask you -- it to come back with your top three estate planning gaffes. There's -- and you have to exclude they didn't do -- at all right right yeah. That definitely is number one. I think my mistake I made was saying that's easy -- thinking about it now not that easy to figure out what -- necessary I think editor thought I would say. When it comes to the more advanced planning furcal for clients that are going to be in the state tax situation. It's starting early. The time value money. Applies to take gifting this. Obese people who have stock options to guys who work at companies that are growing in success current. And think that the time to plan for those options both this state and taxes it is so when they're about to go public. Prize not the time is it. Now now nor is it on that food and didn't didn't. The deathbed of the 75 year old who has eleven million dollars that it starting early is huge even if it's simple. Annual exclusion -- -- -- being the 141000 you're allowed to give to as many people as you want to usually your family time is on your -- -- -- and a staple take advantage of it opens up a world of opportunity down the road if you've already started it opens up. The ability to. It jumped into the more sophisticated areas of grass and sales and and intra family loan cells and you've already. Gotten the basic beat the basics of the advanced planning taking care of -- and you get into the advanced of the advanced and a little bit lower airline now I'm sorry and I hate and I hear that. -- you make a good point. That like everything in life than the more the war in advance notice you have heard of the thing. You know the more the possibilities are in folks you can accomplish almost anything in estate planning would given enough time right. Do you you're you're you're state rarely pay any tax if you do proper planning. And you can maximize the opportunity that your loved ones have the outcome you want to correct because I mean -- gentleman -- In my experience -- having lots of money. Can do just as much good as bad it in the families that I've worked with I'm not sure whether all the money helped her her chair because it diminished. Incentives. For the kids and it caused -- death absolutely and the only thing you can do to mitigate that is very carefully plan your state be ignoring it causes problems for it to me I -- I try to -- on the people's. Emotions as it is the ultimate last gift that you give two they're kids are always look behind is that they don't have to go to court -- -- -- -- ahead. That's good tight credit market write that -- -- could trademark. -- -- because is all I'm sure you'll experience and I have to do that people end up in probate court or they had flights because things weren't settled right or and it just ended -- a family -- pleasure. And that's not what the parents salute the person fast way wants to happen they just didn't do things they need do at a time. Well it along those lines one the other. But it was -- -- -- -- to Tom is in this is going back to more than the basic side of things but. Recognize the state planning is not just the estate and gift tax issues that come along with it or that the advance trust playing. It's -- state playing is also simple beneficiary designations that could account entitling with your bank can and your investment accounts. Those can cause. Big problems that we don't just take a look at those as well. Lot of people think well I don't have any I don't own any thing that isn't subject to some kind of trust deed transfer or. Beneficiary designations irony in his state Miami and in that is part of your state plan got your first wife gets her money for a -- -- -- the counter attacks tenants in common account and and and and life insurance probably the biggest mistake because and number one across the board. Is husband wife one child life insurance policy to be the only asset -- spouse first child second child's six years old. Get a -- miner named as a beneficiary life insurance policy husband might die you've just taken something that is such an easy fix her estate planning attorney. And you subjected that the -- to stay -- to guardianship proceeding which is expensive and it's and you know I'm not gonna get the outcome you wanted not even close friend that suddenly people are gonna come out of woodwork in the family you never heard of because of the money. -- -- They will be in charge of him as the guardian. That's right there's a lot of neighbors but didn't do a lot of different direction -- got to get some very interesting cousins coming into Basra area. That's right the defense. Simple planning can can community arts where -- argument -- last one. The planning between spouses. Everybody. Walks into the office morning the simple plan I love you well I love you honey here's my money. -- everybody leaves the office not doing. You'd be dumb about the the second marriage of the white couple boy after guys that's always the pool boy am -- paranoid but something like I was a boy and there's no industry in these boys -- exactly right. That's exactly right and and that probably so husband watched die isn't wife inherits these state and that's what everybody one able most the time deceased spouse would prefer that that. Surviving spouse doesn't then turned leave those assets to them to the pool boy in our example they would prefer that those are good they're children that's again another very very simple fix for for us. I love that I like your top three Justin knows very well done. Ladies and gentlemen we -- at the end of another. Show of the work quite well watch. We will see you next week. -- is actually this is Jon Bon Jovi is Egypt and she's gonna talk about. Crazy things in rock and roll and financing -- But I wanna think Justin -- off for coming on the Saturday you go to our website at -- point radio dot com and hear the show as well as find a link. Did you to just as website you wanna contact him thing. Thank you very much. You can imagine then it. OK. Then. --

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