Estate & FinancialPLANNING

2013

HighTower’s Anderson Wealth Management is a proud sponsor of

Blair Anderson of Traverse City’s Anderson Wealth Management: Ranked on Barron’s prestigious Top 1000 Financial Advisor list

(231) 941-7093 banderson@hightoweradvisors.com www.hightoweradvisors.com

Let us show you an independent, unobstructed view of your �nancial landscape

HighTower Anderson Wealth Management Full Page Ad April 2013.indd 3 4/12/13 4:06 PM

When fi nancial advisor Brian Ursu was helping his wife go through her father’s belongings after her mother had passed away, he came upon a letter from the priest in his father-in-law’s parish in Ireland testifying to his character. A similar letter from the haberdasher who employed the father-in-law like-wise made a case for the upstanding gentleman. The endorse-ments were key to a successful passage through United States immigration and to landing a job once he arrived. “To me, everything else we discovered was much less interesting than that,” Ursu recalls.

Though Ursu, of International Wealth Advisors, in Traverse City, has helped people map out their fi nancial futures and legacies for years, he has recently begun helping clients with helping them pass along their legacies in a bigger sense, help-ing people convey their values to future generations as well. His experience with his father-in-law’s documents affi rmed his belief in the value of that kind of assistance.

How does that fi t with a fi nancial counselor’s role? “We see ourselves as a family’s chief fi nancial offi cer,” Ursu says. “And values shape how assets will be handled after a person is gone.”

Unfortunately, Ursu has seen it happen during his years in practice. Due to poor planning and assumptions, families end up fi ghting, splitting up, and doing all kinds of things that would make the deceased person really upset if they were still alive. “Rather than leaving those important things to chance, we see it as taking a more proactive role in facilitating those discussions,” he says.

Dealing with those broader issues can take the individual and their family into a couple of different arenas. An advance directive is one common realm. These documents establish how a person wants end of life health care to be administered, including issues like how long an individual would choose to remain on life support and giving direction on balancing quality of life with extreme measures to sustain life. The widely used and respected Five Wishes document is an easy and effective tool in this regard.

But Ursu is also encouraging his clients to write what he calls an ethical will. “It is actually an ancient type of document, going back thousands of years,” Ursu says. “A regular will is about who gets what. An ethical will is more like your story, what you’d want your kids to know about you when you are gone. How did you arrive at your opinions and positions that you hold so dear? What is important to you?”

Randy Pausch’s book The Last Lecture is a fi ne example of what Ursu advocates. Pausch was a pro-fessor who was diagnosed with ter-minal cancer in his late 40’s. While he was still strong, he worked with a writer to create a book that laid out a life philosophy based on opti-mism and pursuing your dreams. The book was ostensibly a long letter to his students and his world, but even more important it was a book to his children, who were still very young.

Your ethical will, however, doesn’t have to be a book-length work to be effective. “You can think of it as a letter to your children to be read after you are gone,” Ursu says. After you are gone only? “You don’t want people challenging you on key points of your letter. I just don’t think this is the place for that,” Ursu says.—J.S.

LEGACY

The Ethical Will

When the goal is not riches, but to live richly.The goals-based wealth management approach of Greenleaf Trust ensures clear-minded focus on helping you achieve the things in life that are most important to you. Through reliable benchmarks, we measure progress in meeting your goals, rather than narrowly measuring performance against a single fi nancial index. At every step of the way, our client-centric team model puts your well being at the center of every decision. To learn more about how goals-based wealth management can help you live a life well spent, call John Welch or visit us at greenleaftrust.com.

Financial Security from Generation to Generation

130 south union street traverse city, mi 49684231.922.1428 800.416.4555

406 bay street petoskey, mi 49770231.439.5016 800.416.4555

To help us understand how chronic care insurance might fit into a family’s overall financial and insurance picture, we checked in with Laverna Witkop, of Ford Insurance. She’s a registered employee benefit consultant who is also certified in health care reform studies. What is the central value of a chronic care policy?

A chronic care policy can help pay for the many miscellaneous expenses that come with being debilitated because the payment comes with no strings attached—often a lump sum payment that you can use in any way you choose. So you can, say, use it to pay for travel expenses for a companion if you have to travel to a hospital and have somebody with you. Or if you need extra things around your house, or extra services, like say, lawn care, when you are sick.

What are some of the important limitations to know about with a chronic care policy?

They tend to be illness-specific. For example, let’s say heart disease runs in your family, you might want to take out a policy to cover heart attack. Or say your grandma and your mother both had breast cancer, you might take out a policy to cover breast cancer. You can even get a policy for maternity because having a baby is considered a temporary disability.

So is family health history a key driver in people choosing this type of policy?

Yes, it often is.

Give us a sense of the cost.The price depends on many things of course, but just for exam-

ple, a $5,000 cancer policy for a 50-year-old nonsmoker would be $9.90 a month, and a $30,000 benefit would be $48.80 a month.

Is there anything with the evolving health care situ-ation that affects the role of chronic care insurance?

Some Health Savings Account (HSA) plans—which are becoming more and more common—have very high deduct-ibles, like $10,000, and if someone in a family had a heart attack, that could be a very difficult thing to cover. So some people are taking out a chronic care policy to help cover the deductible. We carry a policy that offers a $10,000 benefit for a whole family for $51 a month.

Anything else we should know about chronic care plans?

In some cases they can pay for themselves. Say it’s a cancer policy, well, the policy might pay for preventive cancer screen-ings, so if you are having annual screenings, the cost of those screenings might be equal to the annual cost of the policy.—J.S.

INSURANCE

The Role of Chronic Care InsuranceMost people are aware of disability insurance—insurance that pays some percent of your income if you become injured and are unable to work—and of course there’s medical insurance. But what many are not quite as familiar with is a related insurance generally referred to as “chronic care” insurance, that can also help blunt the financial impact of debilitating disease.

What’s on YOUR horizon?

WORRIED ABOUT

It’s time for a second opinion.Now more than ever you need a plan to help you reach your financial goals. We’d love to help.

Independent Fee-Based Advice* Financial Planning*

WORRIED ABOUT WORRIED ABOUT Retirement?

12935 S. West Bayshore Drive Suite 220 Traverse City • 231.941.6669 • Toll Free, 800.495.3462 • www.horizonfinancialtc.com • hollyg@cfnmail.com

*Securities and Advisory Services offered through Commonwealth Financial Network. Member FINRA/SIPC. A Registered Investment Adviser

Horizon FinancialIndependent • Fee based

Since 1992Holly Gallagher CFP®

Wealth Management & Retirement Specialist

.com800-678-3416

Love the shopping in Northern Michigan’s villages and boutiques? When you can’t be here, find everything you need for gift giving, outfitting your summer cottage, taking a vacation or decorating your home so you feel like you’re on vacation on ShopMyNorth.com.

Call us to put your products on ShopMyNorth.com

It happens much more often than you’d imagine. An individ-ual works closely with his or her attorney to carefully map out an estate plan, deciding whom will receive what upon the per-son’s passing, and then, will in hand, the client leaves assuming the job is done. But there’s a key piece that can be overlooked, and that is the client generally has the responsibility of making sure the beneficiary forms on all policies and investments (like 401K’s, IRA’s, or any other assets) conform with the estate plan.

“The beneficiary form on an account trumps the will,” cau-tions financial consultant Holly Gallagher of Horizon Financial in Traverse City. Failure to update a beneficiary form can lead to situations where, say, an ex-spouse ends up inheriting a 401K despite the deceased person’s will stipulating that it go to a cur-rent spouse or children instead.

Gallagher thinks the problem is a somewhat natural out-growth of the estate planning process. An attorney makes the estate plan and explains to the clients that they need to get all of the beneficiary documents to align. But there’s a lot for the client to think about in that situation, and the attorney might be using language and terms the client isn’t entirely familiar with, and maybe the client is uncomfort-able asking for clarification, and then … the final important steps are not taken.

“The best situation I’ve seen is where the estate planning is being done as a team,” Gallagher says—a client’s attorney, CPA and financial planner. For example, CPA’s are good at spotting when a client names a trust as a beneficiary, which can have unintended—and often unwanted—tax consequences.

For her part, when Gallagher learns that a client is cre-ating or updating their estate planning, she asks permission to contact the attorney and provide the attorney with a list of policies and accounts and the beneficiaries listed for each. “I ask the attorney to compare the beneficiaries on file with me to the current estate planning document to see if any changes are needed,” she says. —J.S.

INHERITANCE

Double Check Those Beneficiary Forms

COTTAGE LAW

Property Owners Benefit From Tax Change

“Beginning December 31, 2013 a transfer of residential real property (will not uncap the

property value) if the transferee (new owner) is related to the transferor (previous owner)

by blood or affinity to the first degree and the use of the residential real property does not

change following the transfer.”

This classic bit of tax law legalese—part of legislation that Michigan Governor Richard

Snyder signed on December 28, 2012—should be of great interest to anybody considering

transferring property to family on or after December 31, 2013. In layman’s terms, it means that

the tax rate currently paid on the property will remain unchanged following the transfer so

long as the relationship of the inheritor meets the requirements of the law. So, for example,

if an individual owned a cottage on Lake Michigan that was purchased in 1972, the tax rate

upon inheritance by a daughter would remain at the level the parent paid. As written, the

new law applies only to transfers between parents and their children while both are alive.

Some important aspects of the law remain to be clarified. For example, if the property is

inherited from Mom or Dad, or is owned in Mom or Dad’s trust, does a distribution from the

trust to the next generation count as a transfer from Mom and Dad? What if the property is

in a limited liability company owned by Mom and Dad—are transfers of ownership of the LLC

the same as transfers of real property? How about property owned by a family corporation

or limited partnership? If the answer is “no” to property owned by one of these entities, may

the property be removed and put back in Mom or Dad’s name individually without uncapping

so that it may be transferred to the next generation without uncapping?

Stay tuned to this issue and check with your advisors to see if you need to make changes

that would ensure you qualify to receive this tax benefit—the tax implications for your family

are potentially very valuable.—David Fry, cottagelaw.com

Our Investments | Trust | Retirement Services team has what it takes to help you reach your

financial goals. We are unbiased, transparent and ready to put our 450 years of combined experience

to work for you. Call (231) 947-5530, toll-free (800) 320-5530 or e-mail trust@nwbank.com.

Thank you to The Dennos Museum Center, Northwestern Michigan College

450 years and counting.

HELPING PROTECT YOUR QUALITY OF LIFE AND INDEPENDENCE.

Advocacy

Community resources

Guardianships

Long-term care

Medicaid/Medicare

Probate

SH231-929-4878 www.shrr.com

Ann Arbor GrAnd rApids TrAverse CiTy

Retirement planning

Social security disability benefits

Special needs trusts and planning

Tax planning

Veteran’s benefits

Wills, trusts, and estate planning

Find us on:

Mardi BlackAttorney & Counselor

Martha L. Black, PLC421 St. Joseph, Suite 202Suttons Bay, MI 49682

231.271.3402Over 20 Years Experience

Wills • Powers of Attorney • TrustsGeneral Estate Planning • Probate

Real Property & Business LawLand-use • Zoning & Planning

Environmental LawLocal Governments • Non-profi ts & LLC’s

See the homes featured in this issue, meet the builders and inspire your

dreams.

Saturday, September 7, 2013, 10 am - 5 pm

BENEFITS:

6 Gorgeous Northern Michigan Homes to Inspire You

2013 Northern

Home & Cottage

HOME TOUR

Child & Family Servicesof Northwestern Michigan

SATURDAY, OCTOBER 12, 2013, 9a.m.-5p.m.

Join us for the 6th annual Ultimate Up North Kitchen Tour where you’ll meet and see the work of more than a dozen professional designers with stylish solutions for families just like yours.

SIXTH ANNUAL

Produced by: Sponsors:

Tickets $10 in advance at MyNorthTickets.com

R. Todd Balkema

218 Maple Street, Suite ABig Rapids, MI 49307

231-796-4012

DEDICATED TO SERVING SENIORS

& FAMILIES

1020 Hastings, Suite 105Traverse City, MI 49686

231-935-4646

800-395-4347www.myelderlawplanning.com

MEDICAID • ESTATE PLANNING • PROBATE • VETERANS BENEFITS

Peter A. Jordan

Mara Raven Spence

Offering personalized and comprehensive financial

strategies based on your situation, preferences and goals,

isn’t it time to consider putting a plan in place or having a

“second set of eyes” evaluate your current one?

Call today for no obligation consultation or

review and let’s work together towards a

“Life Well Planned”.

Robert J. Fenton, WMS

Financial Advisor,

Wealth Management Specialist

600 E. Front - Suite 102

Traverse City, MI 49686

Office: 800-946-3650

www.raymondjames.com/rfenton

I help clients Build, Manage and protect their wealth.

Offering personalized and comprehensive financial

strategies based on your situation, preferences and goals,

isn’t it time to consider putting a plan in place or having a

“second set of eyes” evaluate your current one?

Call today for no obligation consultation or

review and let’s work together towards a

“Life Well Planned”.

Robert J. Fenton, WMS

Financial Advisor,

Wealth Management Specialist

600 E. Front - Suite 102

Traverse City, MI 49686

Office: 800-946-3650

www.raymondjames.com/rfenton

I help clients Build, Manage and protect their wealth.

When Financial Waves Are Crashing, Gerschick Wealth Management Can Help Keep You Safe.

Individualized Wealth Management Tax & Estate PlanningRetirement Planning

Business PlanningAsset Protection

Dennis J. Gerschick, CFA, CPA, PFS, Attorney770.792.7444 • dennis@gerschick.com • www.Gerschick.com

Atlanta, GA • Beulah, MI57 N. Michigan Ave. (US 31) • Beulah, MI 49617

Revett, Roop & Associates has been providing financial advice and investment advisory services to clients locally and nationally since 1997. Our professional team of advisors and staff offer each client sound guidance and knowledgeable solutions.

Our unique, individualized approach and step-by-step process helps you establish your personal goals with realistic outcomes. We provide the advice, accountability and expertise necessary to coor-dinate and guide your finances to achieve your lifetime financial objectives. Successfully exceeding your expectations in a profes-sional and confidential manner is our primary goal.

We recognize the value of cooperative interaction among pro-fessionals. An essential part of our service to you is to work col-laboratively and proactively with your tax advisors, legal advisors and other professional advisors.

We look forward to the opportunity to help you achieve future financial success while continuing to provide the responsible, pro-fessional service that sets us apart from the rest.

Revett, Roop & Associates3337 S. Airport Rd. W. #4 • Traverse City, MI 49684

231-947-6700 • www.ameripriseadvisors.com/robert.t.revett

FROM L-R: Robert Revett, CRPC®, Financial Advisor; Cassie Revett, Offi ce Administrator; Thomas Roop, Financial Advisor; Heather Griffi th, Administrative Assistant and Derek P. Dall’Olmo, CFP®, Financial Advisor

MyNorth Estate & Financial Planning

Thinking about your vacation property should conjure up thoughts of happy summers, running children, good food, and relaxation. And hope-fully, it does. But there comes a time when we turn our thoughts to the future. What thoughts and memories will the next generation hold when they think about your cottage?

For too many, the passage of time brings cottage problems. Increasing values will make the property taxes jump, sometimes catastrophically. One of your children may want to keep the property in the family, while another may expect that it’ll be sold upon your death.

Whatever the problem, too often these assumptions are unspoken, and unaddressed until it’s too late. The result is a family dispute… exactly the opposite of what the vacation property is supposed to engender.

Good planning can often be the key. In some cases, letting the next generation deal with its own problems is wise. However, the first genera-tion can only meet its goals by planning. With no plan, when property is left to the next generation, some will see it as a family heirloom, a place to go to relive old memories and create new ones. Others will see its dollar value, and mwant it sold. Sometimes siblings may have conflicting plans making it difficult to share the property.

The specifics will vary, but stress, anger, and bickering become all too common. Planning eliminates uncertainty, minimizes stress, and accom-plishes the first generation’s goals. Heritage, money, family, taxes... plan-ning and structuring... brainstorming and counseling. Get some help. Call Jason Rop at Blakeslee Rop, PLC, cottage planning specialists.

240 Northland Drive • Rockford, Michigan 49341

616-866-9593 • www.br-law.net

MyNorth Estate & Financial Planning

How do we keep the family cottage?

Revett, Roop & Associates has been providing financial advice and investment advisory services to clients locally and nationally since 1997. Our professional team of advisors and staff offer each client sound guidance and knowledgeable solutions.

Our unique, individualized approach and step-by-step process helps you establish your personal goals with realistic outcomes. We provide the advice, accountability and expertise necessary to coor-dinate and guide your finances to achieve your lifetime financial objectives. Successfully exceeding your expectations in a profes-sional and confidential manner is our primary goal.

We recognize the value of cooperative interaction among pro-fessionals. An essential part of our service to you is to work col-laboratively and proactively with your tax advisors, legal advisors and other professional advisors.

We look forward to the opportunity to help you achieve future financial success while continuing to provide the responsible, pro-fessional service that sets us apart from the rest.

Revett, Roop & Associates3337 S. Airport Rd. W. #4 • Traverse City, MI 49684

231-947-6700 • www.ameripriseadvisors.com/robert.t.revett

FROM L-R: Robert Revett, CRPC®, Financial Advisor; Cassie Revett, Offi ce Administrator; Thomas Roop, Financial Advisor; Heather Griffi th, Administrative Assistant and Derek P. Dall’Olmo, CFP®, Financial Advisor

MyNorth Estate & Financial Planning

.com800-678-3416

We cover the best of life Up North, so you can soak it up all year long

• Local foods & wines—recipes and news from farmers markets, vineyards and kitchens throughout the region

• Woods and water—our favorite trails and beaches beckon

• Eye-popping photography—transport yourself to Northern Michigan wherever you are

• Outdoor adventure—for extreme athletes and armchair travelers alike

• Daytrips galore—memory-making outings from dawn to dusk

• Subscribe quick--$2 a month can’t last!

Subscribe to life Up North...For just $2 a month you’ll get the best of Northern Michigan 12 months a year.

Subscribe at MyNorth.com/subscribe