Some of us are getting old and want to “pass something along.” The problem is? If you have another 1-to-20 years to run in this Life, what are the best vehicles to transfer wealth to future generations.
Not a “big deal?” Maybe once upon a time. But, today with pandemic(s), the risk of nuclear war, failure of the internet, and resource depletion? See how the problem gets a lot more complicated?
We’ll jump into it after the usual serving of headlines, outlooks, and our ChartPack view of the stock market.
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George: You never mentioned insurance as a investment to pass on to heirs. One of my favorite is the Fixed Index Annuity. I bought an Allianz FIA in 2013 with the buyout money I received from Allianz when they purchased my business. I invested it 70% stocks, 30% bonds & it has done very well. Also no income taxes if you don’t withdraw any money. Also, you name beneficiaries so it passes outside the will. The benes pay the income taxes on accumulated gains not withdrawn. Also, it has some nifty lifetime income features if you want to use it for retirement income which don’t leave the benes penniless when you pass away. The worst return I can receive is 0% which probably will be the return in 2020. That is only one of the innovative ways to use insurance in today’s world.
From a Quora article here are insurance companies that have gone bust since 2008:
2008 Lincoln Memorial Life Insurance Company
2009 American Network Insurance Company *
2009 Medical Savings Insurance Company
2009 Old Standard Life Insurance Company
2009 Penn Treaty Network America Insurance Company *
2010 Booker T Washington Insurance Company, Inc.
2010 Imerica Life and Health Insurance Company
2010 National States Insurance Company
2010 Universal Life Insurance Company
2011 Golden State Mutual Life Insurance Company
2012 Standard Life Insurance Company of Indiana
2013 Executive Life Insurance Company of New York
2013 Lumbermens Mutual Casualty Company
2013 Universal Health Care Insurance Company, Inc.
The larger ins. co’s (AIG comes to mind) many survived only with tax money.
In terms of ethics, they are in the financial engineering sector and that has every single risk I cited in the risk analysis discussion this AM
On the other hand, if I wanted to make a pile of dough? Selling insurance is great!
You have a 1950’s view of insurance.
Not a single failure cited was from the `1950’s.
One of the key assets of most life co’s is commercial real estate – like malls.
As Ure self…how’s that looking?
Office buildings?
Most of what else they “invest in” can be done directly.
The investment products they sell to individuals was on my mind.
@ NC
ONLY…. GOLD…. WILL BE VIABLE TO PASS ON…as IT has been for 5000 years…NO PAPER OR DIGITAL PRODUCTS WILL EVER SURVIVE…..AS ONE CAN SEE IF READING HISTORY…POLITICIANS PAPER FIAT’S…ARE WORTH LESS..
ONLY GOLD …NOW AND TO YOUR HEIRS
AND PASS IT HAND TO HAND ..NO ACCOUNTS…EXCEPT PRIVATE DEPOSITORIES..
SEMPER FI
I disagree and add paid up farm land…and a good education…
“and add paid up farm land…and a good education…”
I had a friend that had a section of land.. all paid for.. the father had heart problems.. its not covered..
he plead to the congress for help.. there wasn’t a thing they would do.. then the heart surgeon gave in and did it.. the cost.. was his farm.. the comment the doctor said to the family.. I always wanted to own a farm… my dentists kids were fighting over a section of land.. they didn’t get a dime.. besides the lawyers.. the doctors and the state.. gone..
in the end.. its exactly like my brother said.. isn’t it sad that at the end of your life all you have is a couple of boxes of assorted crap a few photos and the memories of what you did and stood for.. that is also why a lot of the wealthy people I have taken care of did what they did.. when it dawned on them that the medical end of it and long term care was going to take it all.. they did things like have a road named after them or buy and sponsor a library or hospital.. an airport.. to keep their memories alive..
one funeral I went to was one of the saddest.. the person was wealthy.. but didn’t give two shakes about how they got there.. treated everyone rotten below them.. she passed on.. I went to the funeral.. it was me.. and the minister.. it was by far the saddest funeral I have ever been to..
the only flowers was the flowers from her dog.. not even the kids sent anything.. had one that seen their moms money was running out.. well that is another story.. my friend.. his wife had a stroke really bad stroke.. she should be in a nursing facility.. but he said nope I can’t afford it and brought her home.. That was just a couple of months ago..
Land, farm or otherwise, may be a good idea, but it can always be taken by government via one racket or another:
1) They can raise taxes to an unaffordable level and then confiscate the land when you can’t pay.
2) They can take it by eminent domain and pay you very little, or possibly nothing at all.
3) They can use recent laws about confiscation of ANYTHING you own in the name of national security.
4) An illegal action, but one that you can’t discount because it has been done, is to claim that a certain type of crime has been committed on your property and therefore they can confiscate it.
So gold is actually a more foolproof investment because you can always hide it and it’s portable. A drawback is that when/if the SHTF, it won’t be worth much because you can’t eat it. My preference is to invest in food, which is also portable and can be hidden, and you can eat it or barter it.
Whoops! The previous comment with the numbered points was made by Tumbleweed, not “t”.
Well I can pass on that I lived thru the most corrupt time and Stockmarket in history. Where we are now is a kick in the guts and nails in the coffins of good Americans. Evil is back in spades . Watched 10 minutes of cnbcc ussa . Feel sorry for the few good Americans to hear those snakes
George,
One other item you might have included would be firearms. Nice article.
We do have at least one reader who collects with his FFL ticket Thompson 1921 machine guns with both 50 and 100 round drum magazines. Talk about appreciating!~
It makes no difference 50 or 100 rounds, because they’ll never wind up in the places (bodies) that would make a significant difference to the lifes of Joe Schmo, JMHO ;-(
Guns and insurance have something in common. If you don’t have them, you will certainly need them. If you have them, you will never need to use them. The key, like any business decision, is to determine how much is enough and then some to account for “surprises”.
Good to hear from you Mr. B.
Speaking of guns…I saw a funny meme today that stated.
“Isn’t it odd that the very people who won’t wear a mask, because they say that God WILL protect them, are the same people that have an entire arsenal of guns just in case he doesn’t.”
For the record…I am a gun owner…and a big 2nd amendment guy…so don’t take this the wrong way….unless you want to talk organized religion. Then we can talk.
Re-breathing what your body jettisons within a mask, including CO2, is not a good idea unless you are compromised or in a high risk setting.
On your 2nd point, there is an old fable of the guy who found the truth. He bent over to pick it up and the devil saw what was happening, saying hey what do you have there? The truth the man said. The devil said, let me help you organize that.
and futher I must add .. the same system of robbery of the people like 08/09.. there is absolutely nothing for the people who dared to try . Jerome the salesman is exactly the same as every other snake oil salesman they have had .. pity on their souls they will need it
Damn it. I dont wanna be right. I’m trying to shift positions, develop new skills.
https://www.wsws.org/en/articles/2020/05/09/pmis-m09.html
Sorry about the kids. Arrggghhhh now there is alot of chatter about Biden dropping out of the race and Sanders would definitely take the party to White House. UGH!
I’m not a prophet, I just a dumb redneck truck driver. I need to quit farting around and get a job.
I may move into sales. I’m super frustrated that some of my predictions are manifesting. Ugh!
Wanna hear God laugh? Tell him your plans. Even if you plan to fail. FTW
I wont be back for a while, I’m too busy. Ugh
Andy
Andy, if you are going to sell someone’s else products in today’s environment, I would hold off & go back to driving trucks which provides a steady paycheck. I was in sales all my life & in an economic downturn, times get tough, but when times are good, the money rolls in. Best of luck.
“I’m not a prophet, I just a dumb redneck truck driver. I need to quit farting around and get a job”
Apparently you know who you are (many others seem not to know!!).
You had reported that you had a “good offer for a job?!” So, what were you waiting for — an extra invitation from theAlmighty?
Yo G – thoughtful, well considered overview of things that can Store Value over time.
I would mention that without being able pursue Life, Liberty and Happiness – none of the things mentioned as Stores of Value are worth SQUATAA.
In the land of snowflakes, welfare cheats and elected social leftists – U have NO CONTROL of Ure life. U R be told what to do, how to do it, and when U can do it. ASSIMILATE.
Obummer luving,Global Leftists, cowards, do not deserve US citizenship .
“Ive got eleutheromania poisoning
its fatal, and it dont get better
Is this a CCP burn?
I gotta dinosaur for a governor(wolf)
he’s got a tiny brain, and refuses to learn.
Real estate is by far the best investment…but..it does depend on where you live. In my area of influence in the Silicon Valley, the average value of housing was just under $200,000 in 1990. Today, the average valuation is $1.45 million. That’s 7x return…not counting tax credits and deductions that are available. In California, our property tax gets basically frozen at the time of purchase…so a person that bought a house for $200,000 in 1990 has a property tax bill of only $2500 a year….even if that home is worth $1.5 million today. That’s some serious savings compared to other parts of the country.
Now…in Missouri, one of the worst states for housing appreciation, I can make the argument that baseball cards have more appreciable value. But , anywhere on the coasts, and pockets like Austin, Dallas, Nashville, Charlotte and Philly are prime real estate metros.
You forgot one thing the greatest danger of them all,and that’s a government that’s run amuck after the passing of the Patriot Act and Homeland Security giving them vast powers that were never intended.
All of the military exercises on urban warfare was for home consumption if the American people got out of hand,which could be laid on terrorism.!!
Looks like another down day. Could this be the end of the 1929 like rally that George pointed out today. I hope so because I was asleep at the switch for the last rally. I will keep a closer eye on this one.
“Some of us are getting old and want to “pass something along.”
in all the years I have taken care of people.. I have only seen a handful that left anything to anyone.. If you die before you end up in nursing care.. you can.. most that end up in professional care leave with nothing… Medical care takes it all..
But.. I did know one in the wealthy class that not only kept his cash but was getting assistance as well..
I once asked him..he said the only way to do it is give it away a little bit at a time at least seven years before you end up in that stage.. or give it all away to someone you trust.. that will manage your cash and let you have access to it when you need it..
otherwise.. just figure on a quarter mil for living for each year and how much you anticipate for medical care then add that up.. otherwise.. just give a gift every year .. there is a limit to how much you can give for a gift.. so check with a cpa or lawyer..
If not.. then spend it.. cause you aint keeping it if you make to the age where you need medical care..and the family aint getting any of it either…. with my parents.. every doctor in the state associated with the hospital sent a fifty dollar consultation bill after they were done.. there was one thousand dollars left for eight .. and that thousand is still in the bank.. the reason.. the cost of getting it is higher than what is in there..and if it comes out.. the state gets it..
Ditto … ditto … ditto. I helped two family members through a nursing home and an Alzheimer’s unit. Today the medical community is adept at keeping you alive until they suck everything out of you. It was better for the previous generation that died from strokes and heat attacks. The cancer victim was less so because they used that family member for a lab rat that went on for a year and a half. “Do no harm” went by the wayside about the time Mengele showed up. There are good doctors out there but the systems they are required to work within are e-v-i-l.
AMEN BILL….
I have seen it so much.. it isn’t even noticed until you are in it.. you do fine Then one day..it all falls apart…
that is also why insurance companies do studies.. discover how long a heart valve works.. when you get close to that date.. you aren’t insured anymore and cannot get it.. we pay over fifty percent of our gross wage on insurance just for my wife.. I shudder to think what mine would be.. if either of us has to go in.. I want a divorce.. not because I don’t love her.. but I want her to survive.. they don’t care.. at all..
that fifty percent isn’t deductible either.. I fear what I see coming with the policy.. for the renewal in january.. not good..
“you might want to “salt several futures” if you can afford it. That is, even if you don’t have offspring of your own, or if they don’t have grandspring…”
If.. URE getting to the age where you can feasibly see a nursing facility in the future.. and you can financially afford it now.. and you have family that need things.. you might consider giving a modest gift.. they will remember the generosity and the state and medical facilities won’t get it..
My brother inlaw was on a cruise with his wife.. they seen an old woman on the liner and got talking to her.. she said that rather than stay at an expensive apartment.. she took cruises.. got her meals and lodging .. and it was actually just as expensive as having a place.. right now.. an assisted living center you are looking at twenty five hundred to six grand.. the place I took my parents to.. ( they had a lot of celebrities living there) you spent a quarter million on the apartment ( 11 by 16 ) and then five grand a month maintenance.. meals were ten dollars a meal and laundry was 250.00 a month.. if you needed assistance.. it was seventy five dollars for the first fifteen minutes then twenty dollars for ever ten minutes afterwards.. now that was twenty years ago..
bathing assistance.. once a week is a thousand dollars a month.. that is what they charge today.. cost is going up by the way..
toenail trimming and all of that is extra.. so if your in your late sixties.. and your in fairly good health but the future comes up really fast.. so do you have kids.. can you swing letting them take over the farm.. maybe give each one some of it.. or just drop off their tuition for college.. I have all my wood working tools.. rather than put it all up for sale I just gave it all to my grandkids.. when they want it come get it.. its yours.. a sale won’t give you much of anything at all.. why not.. or do you like that doctor with the over priced cottage that much.. my theory is give it to the kids.. you paying for their college fund is going to be remembered for ever.. you giving it to billy the prostrait checker won’t be remembered at all.. where the kid that has a thirty year student loan will be forever grateful.. give them the ability to gain more and do more with their lives a little stress free in comparison to what they are looking at..
Random acts of Kindness..
that is exactly what is needed….. trust me.. its worth every penny..
I have an idea. Let’s fight Coronavirus by minting trillion dollar platinum coins & selling them to the federal reserve at full value. Sort of like bitcoin.
Is Nancy alive or dead in this photo? It is hard to tell. Should she be laying in a casket?
https://www.wral.com/highlights-of-democrats-3-trillion-plus-virus-relief-bill/19095325/
https://www.youtube.com/watch?v=XH941L_SNwk
I don’t know.. its hard to tell…..
https://www.youtube.com/watch?v=sZ_-yb-TN9M
Reminds me of the way Lenin looks in his tomb…
Could be that her latest botox paralyzed all her facial muscles.
HAWAII VIRUS STATS FROM HDOH:
Total cases: 638 (3 newly reported)
Hawai’i County: 75
Honolulu County: 414
Kaua’i County: 21
Maui County: 117†
Pending: 0
Residents diagnosed outside of Hawai‘i: 11
Required Hospitalization: 81‡
Hawaii deaths: 17
Released from Isolation: 563§
Cumulative totals as of 12:00pm, May 13, 2020
Three new cases in Honolulu.
The Baltic Dry Index is headed for the cellar:
https://www.bloomberg.com/quote/BDIY:IND
Apparently the index doesn’t cover shipping related to toilet paper and freeze dried rations.
I paid 1.29 a gallon for gasoline yesterday from a major. I’m thinking that deflation for luxury goods and energy is in full view. Prices for paper towels look to be sharply up. I didn’t bother pricing beef.
Once the spiral of defaults and bankruptcies begins to be fueled by imploding social mood, helicopter money will run down the Wall Street Rabbit holes. If all the helicopter money goes only to finance ever-expanding defaults by hedge funds and other monetary leeches, the monetary hyperinflation never makes it to the street level except in the form of government paralysis and expanding private and sovereign defaults. At the consumer level, deflation and hyperinflation exist simultaneously in a dizzying pattern. The illusion of stability and control evaporates. Depressions do not favor debtors or normalcy biases.
While the virus may have been the black swan economic event, it is now simply an environmental hazard. The real danger is in depression, which is giving the appearance of already being in a self-perpetuating downward spiral. Credit deflation with random consumer hyperinflation looks to be on the menu.
Pass the Wealth Strategy:
Fund a Roth IRA for your kids. Instead of a large lump sum, make smaller annual deposits. It may not seem like much now, but in 35-50 years it will be a fortune! I know of no downside and a plethora of upside benefits, to include tax avoidance and privacy.
I considered that, but the huge risk? Government historically doesn’t have any problem changing its commitments when there’s real money involved. If they want the money (“need” lol) they will change the rules and it becomes taxable.
Do you really trust Ure govt. that much?
Not I said Ure.
Ask Gen Flynn about trusting govt.
My distrust goes back a long way, too. When 401K’s came out it was because government allowed them. They look a long way down the road, too, and knew something was coming so why not set a long term trap for savers (hoarders in today’s parlance)? Once they have your money trapped, corraled, reported on and ultimately taxed anyway it was, in reality, a long term savings strategy for the government, not us. Originally it was being said that $100-$125K was beau-coup, plenty to retire on but by the time you needed it you couldn’t feed yourself on less than 3/4 of a mil. The government had stolen all the value out of our money. It’s all a numbers game and the game is just about done.
If you haven’t already done so form an LLC
Again, you trust government will be bound to p[lay nice with legal fictions? Only as long as there is an income stdreasm from doing so.
Just from reading the stub and comments…
Physical Gold & Silver, preferably purchased with cash, are my preferred way. No paper trail – or bank safety deposit boxes – means the gummint lost track of where that money went, and it’s not in the accounts for the lawyer to take 5% off the top.
it’s what I call “shove it across the table” inheritance. No muss, no fuss, no paperwork – it’s yours.
Of course, admonitions to the recipient must abound not to sell it as a lump when daddy’s shuffled off to Buffalo, or the IRS becomes interested and irritable, and there goes half the pile.
Your friend with the Thompsons – well, I could make the same arguments about those as you did the Roth IRAs – and then there’s the matter of the transfer tax. My dad’s Savage 29 octagon barrel trombone action .22 with the original hang tag/price tag ($13.95) will fare better.