Guiding Your Retirements’ Assets from Secrecy to Transparency

More than 75 years after winning the Academy Award for Best Picture, the 1938 film You Can’t Take It with You, starring James Stewart, bluntly reminds us of the role of asset transfer in retirement planning.

While traditionally kept under virtual lock and key by prior generations, assets – with assists from technology and financial planning professionals – are increasingly moving towards disclosure and dialog among families and beneficiaries.

Diseases like Alzheimer’s or even unexpected deaths can undermine a retiree’s intentions for an orderly distribution of assets, whether large or small in amount. Retirement specialists cite these tips for an effective transfer, one designed to keep the IRS from becoming an estate’s largest beneficiary:

Own the transfer responsibility. Intentions can be stated during estate planning, one of the key processes of preparing for retirement. Even if disposition is years away, a framework that optimizes wishes and avoids family squabbles can be specified.

Document and consolidate. Important papers, files, statements and passwords can be gathered physically, or photographed and kept for safekeeping in a safe deposit box or online via cloud storage.

Reduce or defer beneficiaries’ tax burden. Not only can certain assets be shifted to take advantage of stepped-up values upon transfer, beneficiaries armed with knowledge can plan to defend against taxation when constructive receipt occurs.

Trial a lump-sum alternative. Assets can be gifted partially in advance to teach the recipient how to handle an impending windfall. Through discipline and experience, beneficiaries can gain appreciation for a gift or the wealth building process, and hopefully avoid the perils of unsupervised spending.

Given the difficulties of wealth accumulation, it more than makes sense for retirees to have a deliberate plan that preserves and maximizes wealth for future generations or a deserving organization.