Client Situation: Mike and his second wife Barbara got married in 2010. Mike has four children from a previous marriage and Barbara has one son from a previous marriage. Mike has been a Beacon Pointe client since 2012. In 2013 we did a deep-dive financial plan for Mike. He had a complicated situation because he owned eight real estate properties (mostly commercial) and six family limited partnership interests that he managed for himself and his siblings. He also had three trusts – a Survivors Trust, Marital Trust and Bypass Trust – because his first wife passed away, and they split the estate up at that time. From a financial and estate planning standpoint, there were many moving parts. Over time, Mike was also beginning to lose cognitive capacity, so we wanted to make sure his wishes – alongside his family goals in partnership with his wife – were planned out prior to his full loss of cognitive capacity.
Investable Assets: His investable assets started small as most of their net worth was tied up in businesses and real estate. They started by investing $1 million with Beacon Pointe in 2012. Over time, their accounts grew as he sold his business, and sold off properties. Now, their investments with us total approximately $12.5 million.
Beacon Pointe Value Add:
We understand that every client has their own unique financial circumstances. Our goals in this case were:
- Financial Planning – We did a deep dive to get Mike organized. We provided a clear picture of his financial life to explain to his wife, Barbara, the different assets, how they were all titled, and organize existing cash flows. Barbara and their successor trustee daughter felt very comfortable understanding how all the moving parts worked; they both took comfort in knowing they have a knowledgeable and trusted wealth advisory partner guiding them through important decisions and strategizing about the future.
- Estate Planning – We worked with their estate attorney to get Mike’s estate plan updated to reflect his new intentions of benefitting his new wife during her lifetime while protecting the assets for his children. We also updated the estate plan more recently to have successor trustees take over responsibilities.
- Portfolio Management – Mike is a risk-taker and had plenty of cash flow, so we were able to invest the portfolio aggressively.
Goals:
- To organize Mike and Barbara’s financial life before failing health impacted their ability to make decisions
- To preserve and protect inherited assets
- Assist in managing Mike’s assets with care
- Foster portfolio growth for the legacy assets while providing enough cash flow to support their existing lifestyle
Beacon Pointe Action Items:
- Investment Strategy: Developed and implemented a customized investment plan
- Get Financially Organized: eMoney Online Financial Planning Dashboard
- Consolidated and linked all accounts
- Listed all real estate properties with proper titling for organization and understanding
- Modeled cash inflows from various properties and estimated expenses
- Showed projections of how cash inflows will change after various real estate sales and how potential cash flow shortfalls would be made up
- Beneficiary, Assets Title, Cash Flow, and Estate Plan reviews
- Family Meeting: Helped adult children understand the long-term financial plan and explained who the new trustee was, including associated responsibilities
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Important Disclaimer: This case study is provided for illustrative and educational purposes only. It is intended to demonstrate the types of planning strategies and advisory services that may be available through Beacon Pointe Advisors, LLC. The scenario may be based on anonymized, modified, or composite client circumstances and does not represent the experience of any specific individual or family. Any outcomes described, including tax, estate planning, or investment results, are hypothetical illustrations only and are not guarantees of future performance or results. Individual outcomes will vary based on personal circumstances, applicable laws, and market conditions. Beacon Pointe does not provide legal or tax advice.