Sharing Substantial Wealth & Creating a Legacy
Living in Retirement
Primary goal: Understand best strategies for
giving without compromising standard of living
The Background
As Mary approached her 75th birthday, she wanted to gain a better understanding of the financial wealth she had accumulated so that she could develop and communicate her plans to her three grown children and her two favorite charities. There were multiple accounts at different firms, some in trusts, others in her own name. While the total value was substantial, well above $10 million, there were significant annual cash needs given her two homes and one grandchild with special needs who required significant financial support. Tax and liquidity constraints added to the complexity.
The Challenges
- Mary’s accounts were held at several firms and achieving a consolidated view was challenging. She did not have a good handle on what she owned and if there were concentrations/overlaps.
- Mary wanted to maintain her standard of living for the rest of her life and worried about not being a burden on her kids. She also wanted to be sure that could age in place and not be in an institution at the end of life.
- Mary wanted to be generous with her family and charities and questioned the best structure for giving and how much she could afford.
How We Helped
Her team at HTG organized her assets in a consistent, logical framework that allowed Mary to get a comprehensive view of all her investments and uncover an unintended concentration risk. Mary’s cash flow needs were projected so she could determine how much she could gift now to her family and her philanthropies. Simplifying Mary’s wealth helped her better focus on what she felt was most important.
- Gained a comprehensive view of all assets across custodians.
- Uncovered overlapping exposures to a volatile sector at two different custodians which was subjecting her portfolio to excessive risk given her time horizon and goals.
- Projected Mary’s withdrawal needs from her portfolio both with and without at-home long-term care needs.
- Helped her understand estate tax impact of various gifting strategies.
- Gifted $1M of appreciated stock to new Charitable Remainder Trust.
- Established and funded a special needs trust for her grandchild.
