5 tips to the secrets to aging well

What does it mean to you to live a life worth living?

This adage was popular around the turn of the 20th century. It was an exciting time, as the Industrial Age welcomed the Wright brother’s first flight and Henry Ford’s motor car. Yet, in those days most Americans lived an average of only 45 years. A life worth living included making sure that one had a job, was able to feed their family and to make the sacrifices necessary to give their children better opportunities.

Today, a life worth living has taken on a different meaning. We still seek to take care of our families, seeking to meet their basic necessities and to open doors for their successful futures. But most of us can look forward to living much longer than 45 years, which is well beyond launching the generation that follows us.

With the anticipation of living longer, we also talk about living well. A life worth living is an adage that is now used when talking about whether we have found meaning and fulfillment during our years here. We take stock of how we have contributed to the world, and we ask ourselves if we have truly made an impact.

Because of this development, behaviorists now see three distinct phases as they study life and aging.

The First Age is one of preparation and learning, as children grow and acquire life skills. They develop values that will govern their lives, and seek to answer such questions as, “Who am I and how do I fit into the world?”

The Second Age is one of achievement. This is the period of life when people establish their home, family and career. It is during this age that they hopefully become responsible members of society and make their professional contributions.

Then, as we move past the age of 50, we begin to shift into what is now called the Third Age. This age, previously considered as one of decline, is now seen as one of renewal.

Many reinvent themselves at this time, changing careers or professional paths, exploring new ways to enhance their lives and those of others. We step out to enjoy learning and trying out new experiences or interests.

This age can most often be a vibrant and exciting time, and I have often thought that the lexicon that accompanies this period of life does it a great injustice. Terms such as “retired” and “seniors” can serve as psychological barriers to a period of life that is ripe with rich and active opportunities.

How do we make the most of the Third Age? It’s an important question worth contemplating. Without designing this chapter of our lives with intention, we may miss the most meaningful and enjoyable part of life.

Here are five things to keep in mind so that you can make the most of this.

Live with purpose. What is important to you, now? Revisit your top values to see if how you are living now aligns with these. At the end of your life, what will you want to congratulate yourself for having accomplished? Is it a problem you will solve, or a contribution you will make to leave the world a better place? These are questions worth contemplating. Make this a point of discussion with friends or journal on this.

Power-boost your mindset. Do you enjoy a positive outlook on life? A negative outlook can actually cut years off your life. Signs you need to make a shift may include complaining about yourself or others, seeing the downfalls in opportunities before you see the potential, or talking about “why you can’t” with situations, rather than “how you can.”

Challenge your brain. Staying sharp means actively nourishing and flexing your brain. Some fun activities can include learning a new language, playing brain games, taking an online course and meditation. At a time when others are on the decline, decide to boost your memory and build gray matter.

Take care of your body. No list to age well would be complete without talking about things like exercise to maximize fitness, eating the right food, and reducing stress in your life wherever possible. You are never too old to start now. There are many resources online to help you get started.

Strengthening your social circle is a big part of what makes longer life enjoyable. Be sure your social circle is vibrant and meaningful. Do you have friendships that take but seldom give? Others that leave you feeling tired instead of energized? Take stock of your social circle to see if improvements need to be made.

Whether you are facing The Third Age, or well into it, it is not too late to take stock of where you are and where you want to be. Then make the shifts necessary to living a more meaningful and enjoyable life going forward, so that yours is a life well-lived.

Cotton works with executives, business owners, and their companies, to elevate and support leadership at all levels. Reach her via email at Patti@PattiCotton.com.

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What COVID-19 looks like for those of us stuck in the middle class

It has been a little over seven months since the initial state lockdowns, and the focus on our Women Money and Mindset column this month is where we are now financially with the COVID-19 pandemic.

Most of the financial news right now seems extreme and unrelatable for most of us. For example, the wealth of U.S. billionaires increased by a massive $845 billion during the pandemic. At the same time, the number of those living in poverty has grown by 8 million since May.

So, how is COVID-19 affecting those of us who are not billionaires but who are also not destitute? Most Americans (58%) still consider ourselves to be part of the shrinking middle or upper-middle-class.

Those of us in the middle understand that the economy is not just about the stock market, although we most likely have an IRA or 401(k) and may own some stocks. We probably are not at risk of being evicted or losing work permanently, but we may be concerned about our ability to collect rents or might be worried if our businesses will fully recover. We may have suffered some losses this year and wonder if there are any tax breaks available, and we may have cut back on spending because we are nervous about future cash flow.

Here are some economic indicators and rates to focus on now for those of us in the middle.

The eviction rate

Some 12% percent of California renters have no confidence they can pay October’s rent, and an estimated 30-40 million Americans may be at risk for eviction once the CDC moratorium is lifted in January. Why is this a concern if we are not renters? Individual investors own forty percent of residential rental properties. These “mom and pop” landlords will struggle to pay their mortgages, utility bills, property taxes, maintenance costs, and other property-related expenses if their tenants cannot pay rent. Their inability to pay affects the overall economy and our property values.

If you are a landlord

With property taxes due in December, now is the time to determine what to do if your tenants cannot pay the rent.

Make sure to review eviction law changes. In California, the governor recently signed the “Tenant, Homeowner, and Small Landlord Relief and Stabilization Act of 2020”  that prevents evictions until after Jan. 31, 2021, and includes several new provisions that impact landlords. The law also provides new accountability and transparency provisions to protect “small landlord” borrowers who request CARES-compliant forbearance.

If you own commercial rental property, the new law does not apply to you but understand that many counties and cities also place restrictions on commercial evictions, with such protections often limited to small businesses and nonprofits.  Many California sheriff’s departments have also adopted policies declaring that they will not serve writs of possession during the COVID-19 emergency.

Your choices of what to do with a non-paying tenant are limited. You can forgive or lower rent payments even as your personal bills pile up, or hold firm, proceed with the eviction and risk the prospect of losing a tenant who may not be replaced for months or even years. The best solution might make you the hero and not the evil landlord: Work with tenants to see if you can help them apply for renter’s assistance so you can get paid. There are several local and state programs available.

Moving forward, review your property insurance policy with your agent or attorney to discuss lost rent coverage and business interruption insurance, especially if you own commercial rental property.

Interest rates

With interest rates being so low, now might be the time to refinance your rental or business property if it looks like cash flow might be tight. In fact, now is an excellent time to borrow in general, especially if your income was reduced in 2020. Most borrowing would be based on your 2019 tax returns. If there is a further economic downturn, or if the fed tightens credit, the ability to borrow later may not be as easy or inexpensive.

The unemployment rate

If you are a business owner and an employer, the unemployment rate should be of interest to you because it expresses the pool of employees available for you to hire. When unemployment was only 3.9 percent in September 2019, the number of candidates available, particularly as a small employer offering limited benefits, was restricted.

Now that the unemployment rate is 11% or more, the potential pool of employees available for you to hire just tripled, and the quality of the candidates has probably improved. It might be a good time to consider increasing staff if your company is recovering or if you want to grow.

If you did not take advantage of the Paycheck Protection Program, PPP, then you may be eligible for payroll tax credits when you hire or re-hire employees. You can even request payment now for employer payroll taxes you have already paid since March. For more information, visit IRS.gov/coronavirus.

Tax rates

If you sustained losses in 2020, it might make sense to file your 2020 taxes early in 2021 to carry back the losses to 2018 and 2019 to claim a refund of taxes paid.

If your income was reduced during 2020, it might also make sense to reduce or eliminate the payment of your fourth quarter estimated tax payments in January.

If you still need cash this year, consider taking out an early distribution on your retirement plan to cover expenses (or pay off high-interest credit cards you may have charged), avoid the 10% penalty with the Coronavirus exception, and possibly pay tax at a lower rate this year, if your income was reduced sufficiently. Talk with your financial advisor.

Make sure to book an appointment with your CPA or tax attorney before the end of the year to discuss tax and estate/gift planning opportunities if your taxable income and value of your business were reduced this year.

While we have received good news over the past few months that the stock market is recovering, companies are re-hiring, and the very rich are doing well, we also see unsettling news about lines at food pantries and businesses shuttering. The truth is we do not know what tax laws, economic policies (or federal relief efforts) are in store for us until well after the election. Until that time, pay attention to small steps you can take to secure your overall financial health.

Michelle C. Herting specializes in estate, trust and gift taxes, and business valuations. She has three offices in Southern California and is president of the Charitable Gift Planners of Inland Southern California.

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Legal lessons from a pandemic: What you can plan for

I have been one of the lucky ones since the pandemic hit in March of this year. My loved ones are healthy, and my law practice is busier than ever. But I see the havoc COVID-19 has caused—I see it in my clients every day. I feel it myself sometimes, too.

It’s a sense of unease, of unknowing, and, perhaps most significantly, of a lack of control. It’s hard to plan for next week, let alone the future, when our environment, the advice from the experts, and indeed the outbreak itself, seems to change on a daily basis.  Can we take a vacation? Does it make sense to have a family gathering for the holidays? And if not now, when?

What we can plan for

That fear of the unknown and the need for control is why my office has been so busy. It’s that old saying, “only two things in life are certain: death and taxes.” Since I’m an estate planning attorney, I deal with both. My high net worth clients are concerned that if the election tilts one way, the very advantageous estate tax laws will change, and we’re busy doing planning and gifting to take advantage of current tax laws.

But everyone, no matter their net worth, is suddenly acutely aware of their own mortality, so we’re also busy with estate planning. Preparing for death or incapacity is one way of taking control.

Everyone age 18 and older needs a health care directive, a power of attorney, a HIPAA form and a will. If you own assets (that don’t have beneficiary designations) with a gross value of more than $166,250 in California, you should consider a living trust. A trust avoids the more costly and time-consuming probate process (especially in the times of COVID-19 when courts are working at a slower pace).

How to plan and take control

Hastily preparing estate planning documents due to sudden illness, travel plans or an unexpected change in life is not ideal. If the pandemic has you with more time on your hands, a more constructive use of that time — and a way to garner a little control — is to think about your estate planning and get it implemented. Spend some time thinking about these documents and the decisions inherent in this type of planning. The state of the world probably has you thinking more than ever about your values, and that’s imperative in estate planning.

We generally encourage clients to think about the next three to five years. If something were to happen to you (death or incapacity) in that time frame, what would be important to you? Don’t just think about who would inherit your estate—that’s often the easy part.

Decisions to be made

In the event you are incapacitated, who would manage your assets? Who would make personal decisions for you, such as where you will live, who your doctors will be, how your spiritual needs will be met? Do you have pets that need care?

It’s also a good idea to name alternates in case your first and even your second choice isn’t available (for example, you’ve named your spouse but you were both involved in the same car accident and he or she can’t act).

Advance Health Care Directives have received a lot of attention since the pandemic. Now, most everyone is familiar with ventilators and intubation, among other medical procedures. A health care directive allows you to state your preferences for those scenarios and others. Do you want life-sustaining treatment even if you’re in a condition considered irreversible? Do you want pain relief even if the medication shortens your life? Do you have any religious preferences that should be met, such as last rites? Do you wish to donate organs?

The agent named in your health care directive is also the person with the authority to carry out your post-death wishes, so be specific about cremation, burial, religious services, and the like.

Leaving a legacy

A living trust can be an ideal way to preserve a family legacy. When setting up a living trust, you decide on what you want to occur, and who you want to be involved in the event of your death or incapacity. You will decide who your beneficiaries will be (i.e. who inherits from you when you’re gone), whether you want assets going directly to those beneficiaries, or whether you want your assets held in a trust and distributed to your beneficiaries for purposes in keeping with your values.

For example, if education is important to you, you could structure a trust that provides the funding for education for your children, grandchildren, nieces and nephews (whomever you’d like) and reward specific goals obtained — cash distributions, for example, upon graduation from high school, college, or post-graduate work.

Your trust could provide for health care. If you have a special needs beneficiary, you may want to leave their gift in a special needs trust that provides for them but does not make them ineligible for government benefits. If a strong work ethic is important to you, your trust could provide for distributions to beneficiaries on a “matching” basis — annual distributions to match 50% of the beneficiary’s earnings, for example. A trust can likewise provide a supplement to beneficiaries who go into public service careers like teaching, law enforcement, or government work.

A sigh of relief

Often clients have trepidations about seeing me, and I get that. Seeing someone to talk about death and taxes is a lot like going to the dentist — you know you need to, but you suspect it will be painful. Think about estate planning instead as a way of formalizing your values and what you’d like to pass along to your beneficiaries. Think of it as a gift you are giving them.

If you think of estate planning as planning your legacy rather than as “death and taxes,” you will better be able to take control and plan for the future. Then, I suspect, you’ll be like many of my clients who are surprised at how relieved and how good they feel once the plan is completed. Of course, then I tell them they should come back for a review in three to five years, but that’s less painful. And won’t it be nice to think about the future again?

Teresa J. Rhyne is an attorney practicing in estate planning and trust administration in Riverside and Paso Robles, CA. She is also the #1 New York Times bestselling author of “The Dog Lived (and So Will I)” and “Poppy in The Wild” released on October 6, 2020.  You can reach her via email at Teresa@trlawgroup.net

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Lessons from a pandemic: Save a lot, ride out the market

With the emergence of the coronavirus, we found ourselves in a global pandemic of proportions that, in our lifetime, we had only experienced in movies. Since March, we have been social distancing, wearing masks, and ordering our meals, groceries, and supplies online.

This disruption has changed our daily routines in ways we would never have expected. Fortunately, this pandemic has not been as deadly as the Spanish flu of 1918 but may have changed our lives in some manner forever.

While many of us have tried to stay focused on our family and work, it has not been easy. This disruption has changed our routines. After six months, parents are still finding themselves working from home while managing their children who are learning in a virtual classroom setting. In spring, we were all hopeful that social distancing would be temporary. But reality showed us this was not the case.

Many of us may find ourselves in this same setting until spring or summer of 2021. For example, Deutsche Bank publicly announced last week that its employees do not have to return to the office until July 2021.

Most of us have learned to keep enough food in our pantries and freezers to last several weeks without needing to make grocery store runs. Early in the pandemic, if we ran out of certain items, there was a good chance the stores were also sold out of the product. Our only option was to shop early in the day and stand in a long line to enter a store. Certain products seemed unobtainable. We were fortunate that the supply chain quickly rebounded to meet our needs.

COVID-19 taught us that, even in the U.S., we can experience empty grocery store shelves and people hoarding goods.

One takeaway from COVID-19 is to plan ahead and be prepared for the next disruption.

This pandemic is a reminder of why it is important to keep at least six months of cash reserves in your bank account. Many people have been laid off for months, many employees have permanently lost their jobs, and many small businesses have closed. The purpose of having a cash reserve on hand is to have the ability to access money in a financial crisis without incurring additional debt or having to sell your investments at the wrong time.

If you were not prepared financially for this pandemic, your primary focus going forward should be building an emergency cash reserve. It may be that in lieu of a six-month reserve, a 12-month reserve is more prudent.

The feeling was gut-wrenching as we watched the S&P 500 Index of large U.S. companies drop 34% in March from its market high on Feb. 19. The negative market swings caused much anxiety. If you panicked and liquidated a portfolio in late March, there was a good chance that you realized a significant loss. If you held tight, your portfolio should have rebounded. JPMorgan recently raised their expectations, predicting a 6% gain in the S&P Index this year.

While periods of market unrest are very unsettling, it is important to remember that history has shown us that the market will turn around. Our instinct in a volatile market is to sell out to preserve assets and avoid any additional losses. That approach might yield favorable results if we knew specifically what day to re-enter the market. But we do not, so hold tight.

The annualized return on the S&P 500 from Jan. 1, 1987 to Dec. 31, 2019, was 11.28%. Over this 32-year period, if you were out of the market during the 10 best-performing days, your annual return would have been reduced to 8.85%. If you were out of the market during the 50 best days of this 11,680-day period, your annual return would have decreased to 3.4%. History tells us that staying in the market yields better long-term results.

It is important to maintain a diversified portfolio so that, like in March, when the stock market plummeted, other asset classes—like bonds—performed well. If you are diversified, you are not investing in a single stock, or in a handful of stocks, and nothing else.

In most cases, an investor should have a variety of equity (stocks) and fixed income (bonds) in their portfolios. The best allocation or mix of investments depends on your age and risk tolerance level. The longer your timeline to retirement, the greater the opportunity to hold a higher concentration of equities. Managing risk as you age means gradually decreasing equity positions and increasing the allocation to fixed income.

COVID-19 has forced many us to change our daily routines and to re-evaluate our lives. We have not been traveling, attending sporting events, parties, or concerts, or commuting as much to work. These changes have provided us with the time to focus on our family, finances, and plan for our future. Sometimes, we get caught up in the fury of life and lose focus on what is important. Like it or not, COVID-19 has given us the opportunity for a reset.

Teri Parker CFP® is a vice president for CAPTRUST Financial Advisors. She has practiced in the field of financial planning and investment management since 2000. Reach her via email at Teri.parker@captrustadvisors.com.

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Aging relatives could be hiding their frailty

I have a client who is in her early 90s and lives independently in a senior apartment living complex. She pays her bills, buys her groceries, showers regularly and cleans her home daily. At least that is what she will tell you if you ask her.

Recently, I scheduled an appointment with her to drop off a small bistro table for her patio. At one period in her life, she was a nun and continues to live by a vow of poverty, spending only enough money to survive. She had completely forgotten that I was coming, even after two reminder phone calls. Once I arrived, I spent the afternoon helping her organize the patio, tossing trash, and putting items away to make space for the new furniture.

When we shifted into the home, I discovered it was a complete mess, just like the patio. Papers were stacked a foot high on the kitchen table, flowers were sitting in vases of rancid water, the kitchen cabinets were sparsely filled and the bathroom was filthy. The overall living conditions were not acceptable. I helped take a few items to the trash bin outside, vacuumed the carpet and took many mental notes.

As soon as I left, I reached out to her only local family member and explained what I had observed. We had a difficult, lengthy conversation discussing how her loved one has reached a point where she needs additional assistance. We brainstormed until we had a plan in place that seemed to address the current situation.

It is difficult for most people to notice and accept the subtle changes in their loved one’s behavior that indicate that they may need additional assistance. Usually, the elderly person will not ask for help, knowing that they may be losing their cherished independence.

For the caregiver, acknowledging these changes pushes the awareness that our loved one is not immortal to the surface, reminding them that death is looming in the future. Sometimes family members believe they have failed because their loved one cannot live independently. The logical side of us knows that this is not true. Unfortunately, our emotions can interfere with our ability to accept that change must occur.

I did notice several signs that perhaps by themselves would have gone unnoticed but combined were a red flag. The signs were:

Forgetfulness: Recently, I have observed that this client is more forgetful than in the past. If we are scheduling a meeting, I ask her to grab a pencil and write down the meeting date and time. Sometimes she calls me several times before the meeting because she knows it exists but cannot recall when it is.

Disorganized, dirty home: My client has always lived a simple life, living in a clean, tidy home. However, because of her age, she had reached the point where doing laundry is physically difficult and where scrubbing the shower and changing her sheets is impossible. When I visited her home, it was a mess.

Lack of personal hygiene: My first observation when I arrived at her home was her appearance, and I immediately wondered if she was bathing. I peeked into her bathroom to observe if it was even feasible for her to bathe. It was not; the tub is about 16 inches high, which would be an obstacle for her to climb over. Her clothes did not fit and were secured by what appeared to be a man’s belt. This was not the typical outfit of a blouse and pants that she had worn for years. She almost looked as if she were homeless.

Minimal groceries: The kitchen cabinets were bare. I noticed a few Top Ramen containers of noodles. The refrigerator was sparsely stocked as well. The stove was piled with objects, and the counters were cluttered with stuff. Cooking any type of meal was not happening in that kitchen. In fact, reading instructions and opening certain types of food containers were probably not occurring either.

Consumed by loneliness: COVID-19 has been paralyzing for this individual; she is terribly lonely. Her local family member has not been able to visit since March due to health risks. She is possibly depressed due to the lack of social connections.

After I reflected on these observations, it was clear that additional assistance was needed. At this point, it seems that my client does not need round-the-clock care but would benefit from in-home assistance. She needs someone to help with meal preparation, laundry and bathing.

So initially, an in-home care company was vetted and contracted to provide two days of service. Additionally, a house cleaner was hired to clean the apartment and change the sheets weekly. Meals on Wheels now provides one freshly prepared meal a day. The family member, who also is the agent for the power of attorney and trustee for the trust, understands that she needs to provide oversight and possibly assist with the finances.

The most difficult and important step in this type of scenario is accepting the fact that a loved one is aging and needs additional help. Most likely, they are not going to admit that they are having a difficult time. It is possible that they may even tell little white lies to cover up the truth.

Look for signs that they may need assistance, brainstorm for solutions, and offer to help. If you feel frustrated because of the necessary changes, place this aside. Remember, we begin our life needing a caregiver and often end our life needing a caregiver. It is the circle of life.

Teri Parker is vice president for CAPTRUST Financial Advisors. She has practiced in the field of financial planning and investment management since 2000. Reach her via email at Teri.parker@captrustadvisors.com.

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You win big: Don’t go out and buy cars for your friends

Over the past few months, our weekly column has focused on the sad realities of the death of a loved one, divorce, disability and COVID-19. These are not happy topics but do reflect how we spend much of our time and energy, helping our clients through tough times. Because of this, we are thrilled when one of our clients has a big win.

Whether they have won the lotto, sold the next brilliant idea, or received an inheritance or legal settlement, when our clients win, we also vicariously experience their joy, satisfaction, and hopefulness for the future.

There are a couple of recurring truths I have found when dealing with these unexpected windfalls. First, it is shocking how quickly people are able to burn through large amounts of cash, and, also, it is unbelievable how smart people can make terrible snap decisions about managing vast sums that should be enough to last a lifetime.

Approximately 70% of lotto winners lose or spend all of their winnings in five years or less. So, here is some practical advice, with examples, for how to manage an unexpected windfall and make it last.


Aside from signing your lotto ticket, the first step would be to hire the most qualified attorney you can afford to review the documents that led to your windfall. These could include the sales agreement, settlement, trust distribution documents, or prenup/divorce agreement. This way, you will not be left to wonder if you received everything you were entitled to, with the best terms that were available.

To maintain privacy and security, you might want to consult with a qualified attorney about setting up a trust to receive the funds. It would be best if you also put a freeze on your credit bureau files to prevent identity theft and keep your windfall secret until your plans are in place.

There is often discussion regarding whether to choose a lump sum or annual payments. It depends on your age, your plans, tax rates, and the annuity rate versus what you can earn if you invested the lump sum. You will need to consult with a certified financial planner and certified public accountant to determine which will work best in your situation. They should be able to provide you with clear graphs and computations you can understand.

For example, a client won a $5 million settlement. He wanted to purchase and live on a remote ranch in Mexico. They took the lump sum because financing in that location was not an option, and they invested the balance for an income stream.

A CPA will also help you plan, minimize and set aside funds for the taxes. Do not skip the tax planning before you count on how much you have to spend. The combined top federal and California tax rates are now over 50%. With proper tax planning, the tax rate could be far less.


Next, realize that you are human and you are going to want to spend some of the windfall right away. This is why we suggest that our trustee clients make a small, early distribution to beneficiaries. It helps them get some of the spending out of their system. So, pay yourself a small distribution and have a party or go on vacation — make it something memorable. Set the rest aside.

Vehicles seem to be the first purchase people make with their windfall.  Before buying cars for all of your friends and family members, consider the income and gift tax implications and if the purchases are the best use of your winnings to help your family members.


Most advisers recommend letting your windfall sit for six months while you pray, meditate or just think about your plans before making any large purchases or significant investment decisions.

Within a month of the death of her husband, a widow said she felt coerced by a “friend” into purchasing an annuity with all of the proceeds from her husband’s life insurance. She explained that she was not thinking right when she did it because of all of the grief and shock. The annuity payments were not sufficient to pay debts and to support her children and contained excessive commission payments to her friend.

Fortunately, the supervisor at the life insurance company agreed to refund the widow’s investment after we threatened legal action.

If you are feeling coerced or burdened by friends and family members asking for hand-outs or investments in their latest scheme, the easiest response is to blame your professionals. For instance, you can tell them the funds are in trust, and your trustee will not allow it, or that all of your assets are tied up due to the way your CPA has structured everything for taxes.


A strong urge people have when they come into money is to correct everything they have seen as wrong or off in their lives. I always tell clients to take their time and enjoy the process of “fixing” everything.

One mature, newlywed bride who married a wealthy man came to see me, and I gave her that advice. Sure enough, after buying the new car, new clothes, dental implants, new home on the beach, and plastic surgery within only two years, she came back to see me, and asked, “What now?”

Her new wealth did not bring the happiness she expected.


If you are thinking of giving away large amounts of cash to your church or favorite charity, consider seeking advice about charitable gift planning to maximize the impact of your gift while also minimizing taxes and supporting your other family goals.

The clients I have seen who were happiest with their windfall and were able to preserve it were less changed with the new wealth and acted more of stewards of their fortune. The plans they developed with their professionals provided for a much-needed sense of long term security while allowing for enjoyment of the newfound resources.

During these tough times, it is an excellent diversion to muse about all the good we could do with an unexpected windfall.

Michelle C. Herting, CPA, ABV, AEP specializes in estate, trust and gift taxes, and business valuations. She has three offices in Southern California and is president of the Charitable Gift Planners of Inland Southern California.


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How do you strengthen workplace culture when everyone’s #WFH?

How do you retain your company culture when you have a remote workforce?

Retaining who you are and what is important to the company is more challenging when you aren’t in the same physical space on a regular basis.

Yet, many companies with international teams and other remote situations have been successfully enjoying solid culture throughout their organizations for years.

How do they do it?


The best companies know that culture is what makes or breaks them. Culture defines who you are as a company – your corporate identity. It sets the standard and tone for the way your workforce works together. It’s what gives people a shared identity – a team, a sense of belonging. And it’s the glue that holds people together when the going gets tough.

But when people aren’t in the same physical environment on a daily basis, adopting and sharing the same tone and standards in thoughts, behaviors and actions can be challenging.

A remote or hybrid environment calls for being more “on purpose.” And this is not a bad thing. Many companies have lost their culture because they have simply taken it for granted. Setting intentionality is what will revive this, whether there is a remote component to your workforce or not.

Here are some things to consider as you seek to reinforce culture with a remote workforce.

Add virtual ways to share the company story and tell it often.

As you revisit your values, norms, and priorities in light of considering a remote and hybrid workforce, realize that the way you do things may change, but it doesn’t change who you are and what you stand for.

At the same time, you will want to seek to make your company story memorable in creative ways more frequently and in different ways to emphasize identity.

Look for seminal touchpoints to share this, such as announcing company-wide changes, annual meetings, company marketing collateral, and key celebrations. Include virtual ways to strengthen this, such as online meetings, video interviews and story markers in communications and at the bottom of email messaging, shared drives, and chat mechanisms.

Define what it means to live company values.

Most companies outline their values, but they don’t take the time to define what these look like in action. For example, if one of your company core values is creativity, what should that look like in behaviors, actions, work, relationships, outcomes, etc.?

You and your executive team should be firm on what all of your core values look like in action. Further, take the time to discuss what these might mean and how they might show up in a virtual or remote setting.

Test these thoughts with your employees for feedback and buy-in – this is key. Then decide how you can weave this into your communications, your meetings and other touchpoints, and how to integrate this into your performance standards.

Communicate with greater intention.

This means not only increasing your communication, but heightening the way that you connect, such as using video when touching base virtually.

Be sure that you set expectations around your communication methods and protocols so that this becomes part of your shared “way of operating.” Place greater emphasis on culture during your onboarding of new employees and leave time for discussion around this.

Consider building in an accountability component for the direct supervisor of a new employee, ensuring that they have discussions around what your cultural markers are and how they show up in and at work. Devote intentional time for listening to the employees as well, especially in virtual meetings.

Take the pulse on what their challenges are, what they are learning, and opportunities they see for improvements and working better together.

Reinforce the importance of their part in the company community.

Help your employees feel known and part of the team and help them to see how they fit into the bigger picture. Systematize some teambuilding exercises that help everyone to get to know them personally and vice versa, and that identify gifts each brings to the table for greater outcomes. A sense of inclusion and contribution is paramount.

Be sure to capitalize on ways to recognize employees in both face-to-face and virtual settings for visibility, appreciation, and teambuilding. Consider cross-training or mentoring with different people to get to know others more rapidly across teams.

In your planning and process to define, strengthen and reinforce culture, please also remember that including your workforce in discussions at key points in various ways will pay great benefits. Allowing the entire employee base to give input means that they will also feel ownership and responsibility for the outcomes.

Patti Cotton works with executives, business owners, and their companies, to elevate and support leadership at all levels. Reach her via email at Patti@PattiCotton.com.

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Planning ahead for incapacity helps you and family

One in four American adults live with a disability, according to the Center for Disease Control. One in 10 adults over the age of 65 has Alzheimer’s or dementia, according to the Alzheimer’s Association.

With numbers like that, we should all be planning for the possibility of our incapacity to handle our day-to-day lives.

Defining incapacity

California defines mental incapacity as an inability to make decisions or perform certain acts. Generally, there is a rebuttable presumption that a person does have capacity and the burden of proving otherwise is on the person seeking to have someone declared incapacitated.

A person who has a mental or physical disorder may still be capable of contracting, conveying, marrying, making medical decisions, executing wills or trusts and performing other actions. But when a person has been declared incapacitated by medical personnel or a court, it’s important to have a plan already in place.

Planning for incapacity

In addition to talking to your loved ones about your wishes and perhaps getting long-term care insurance, as was discussed in last week’s column, there are legal documents that will be necessary.

Durable power of attorney

A power of attorney is the primary document needed in the event of incapacity. This is the document that authorizes someone to act on your behalf in the event of your incapacity.

A “springing” durable power of attorney means that it “springs” into effect when you are declared incapacitated and remains “durable” (i.e. continues in effect) throughout your incapacity.

The document can be broad—known as a “general” power of attorney—authorizing the named agent to act on your behalf for a variety of matters, including finances, personal matters (such as where you will live, which doctors treat you, what personal items you need), caring for your pets, buying and selling assets, entering into contracts, handling digital assets, providing for your spiritual needs and paying your bills.

Or a power of attorney can give only certain limited, specific powers, depending on your desires.

A power of attorney can be activated before you are incapacitated. For example, if you are diagnosed with early-stage dementia, you may still have legal capacity. If you feel more comfortable having a trusted family member handle matters for you, the power of attorney could be activated voluntarily immediately.

Often times, elderly persons have full capacity but no longer want to handle their financial matters, or perhaps the sale of their home, or entering into legal contracts, and can instead execute a power of attorney authorizing a trusted person to act on his or her behalf on those specific matters.

Three warnings

A power of attorney is a powerful document—you are handing control over to someone else. While your agent does have fiduciary duties and could be sued for mismanagement or other bad behavior, that won’t be of much comfort to you if you’re too incapacitated to help yourself and your funds are all spent.

Choose the person you appoint as power of attorney very carefully, and be sure to name alternates.

Also, a power of attorney is not valid for any asset held by your trust. A power of attorney will work for insurance claims, bank accounts outside the trust, Social Security, retirement plans and personal matters. It will not work for the accounts which are (and should be!) titled in the name of your trust.

Only your successor trustee may step in and handle assets titled in the name of your trust, so make sure these documents are coordinated.

Finally, a power of attorney expires at death. Once you pass away, the power of attorney is no longer valid. After your death, the person holding the power of attorney will not have access to any financial assets, will not be able to make any decisions for you and is not the party who makes your burial and funeral arrangements.

­Advance health care directive

An advance health care directive (also known as a “living will”) is a document that provides your instructions as to the medical care you do or do not want in the future as a result of conditions such as dementia, a stroke, coma or brain injury.

The health care directive also names an agent to carry out your instructions. Alternate agents are again recommended.

The directive will explain your preferences regarding specific medical treatments, resuscitation efforts and life-sustaining efforts. This may include directions regarding the use of mechanical ventilation or feeding tubes, as well as certain surgeries and medications.

The directive may also give instructions for post-death wishes regarding autopsies, organ donations, cremation or burial. The person named as your health care agent will be the person authorized to make these sorts of decisions (not your power of attorney).

California has a statutory form that is available online and from many health care providers. Every adult should have one completed and available.

Living trust

A living trust is an excellent estate planning tool but also can be of significant help in the event of incapacity. A trust can name the party that steps in to act as trustee should you become incapacitated. Your successor trustee will be able to take over your financial assets (assuming they are properly titled in the name of the trust), manage those assets, and make certain that decisions are made in your best interest.

If you do not have a living trust, this can all be done through a power of attorney. But bear in mind the power of attorney will cease to be valid at your death. At that point, if there is no trust, a probate must be started before anyone will have the legal authority to handle your affairs. With a trust, it takes only the doctor’s declaration (sometimes two doctors) of incapacity or a death certificate for the successor trustee to be able to step in. And that’s important, because often with incapacity, time is of the essence.

As 2020 has taught us, none of us know what life has in store. Get your affairs in order while you can—for your sake and your family’s.

Teresa J. Rhyne is an attorney practicing in estate planning and trust administration in Riverside and Paso Robles.  You can reach her at Teresa@trlawgroup.net

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Key COVID-19 legislation for businesses and people

In response to the COVID-19 pandemic, the federal government passed three phases of legislation and a slew of administrative guidance.

Phase 1 primarily provides emergency funding to various federal agencies. But provisions in Phase 2 — known as the Families First Coronavirus Response Act, or FFCRA — and Phase 3 — the Coronavirus Aid, Relief, and Economic Security Act, or CARES Act — benefit businesses and individuals.

Here are key provisions of the FFCRA and CARES Act.

Expansion of the Family Medical Leave Act: Generally and until Dec. 31, employees working for an employer with less than 500 employees for at least 30 calendar days are eligible for additional FMLA leave if he or she cannot work because he or she is required to care for a child due to certain COVID-19 related circumstances. The additional FMLA leave period is up to 10 weeks.

Emergency paid sick leave: Until Dec. 31, employers with less than 500 employees are generally required to provide up to 10-days — or 80 hours — of paid emergency sick leave if an employee cannot work due to certain COVID-19 related circumstances.

Circumstances include being subject to a government quarantine order and caring for a child because the child’s child care provider is unavailable due to COVID-19 precautions.

Tax credits for businesses providing expanded paid family leave and paid emergency sick leave: Employers required to make expanded FMLA or emergency sick leave payments are generally entitled to a refundable credit against the employer portion of Social Security taxes for such payments.

Employers are to deduct the credit they are entitled to from the amounts withheld from employees that would normally be deposited with the IRS.

Delayed payment of employer payroll taxes: All employers may defer the payment of their share of payroll taxes otherwise required to be deposited from March 27 until Dec. 31.

To avoid penalties, half of the deferred amounts must be paid by Dec. 31, 2021, and the remainder by Dec. 31, 2022.

Individual tax credit for 2020: For 2020, eligible individuals are allowed a refundable income tax credit of up to $1,200 (or $2,400 for those filing jointly), plus $500 for each qualifying child for the child tax credit.

Those who would have qualified as eligible individuals in 2019 are entitled to an automatic advance refund equal to the amount of the credit that would have been allowed had it been in effect in 2019.

Waiver of an additional 10% tax for COVID-19-related retirement plan distributions: Employers may amend retirement plans to allow employees affected by COVID-19 to withdraw up to the lesser of the plan balance or $100,000 during 2020 without incurring the additional 10% tax normally imposed on withdrawals by those under the age 59 ½.

Employees that repay the amount to the plan within three years will not have to recognize the withdrawn amount for income tax purposes.

Loan flexibility for qualified retirement plans: Before Sept. 23, qualified employer plans may be amended to allow for loans of up to the lesser of the employee’s vested accrued benefit or $100,000 for those affected by COVID-19.

Participants affected by COVID-19 with outstanding loans may be allowed to defer payments due between March 27 and Dec. 31, for up to 1 year.

Waiver of required minimum distributions: Participants in defined contribution plans—like a 401(k)—and IRA owners are required to take minimum distributions each year after reaching a certain age (70 ½ or 72 depending on the distribution date).

These required minimum distributions are waived for 2020. Participants and IRA owners who took required minimum distributions in 2020 before the CARES Act was enacted may rollover such amounts or repay them until Aug. 31.

These are only some of the provisions in the FFCRA and CARES Act that benefit individuals and businesses. State and local laws and orders also provide additional relief. Finally, businesses and individuals should be prepared for evolving guidance as the pandemic continues.

Allison M. De Tal is an attorney in Best Best & Krieger LLP’s Business practice group who focuses on tax and employee benefit matters. She can be reached at allison.detal@bbklaw.com.

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If COVID teaches us anything, it’s save now for the unexpected

Last year, while enjoying a lovely dinner with several friends at a favorite local restaurant, our evening was disrupted by a phone call. The news was devastating.

While we were spending an evening filled with laughter and camaraderie, a husband of one of the ladies was at home watching their children. He needed something that was stored in the attic and climbed up the access ladder to obtain the item.

The access ladder, which was permanently attached to the entrance of the attic, suddenly gave way. My friend’s husband abruptly fell to the concrete floor beneath him. Fortunately, he survived the fall, but he suffered very serious injuries that left him partially paralyzed. In a split second, this family’s life changed forever.

How does one prepare financially for such an unexpected event?

Since the accident did not occur while the husband was working, he is not covered by workers’ compensation — insurance that varies by state, providing benefits to employees who suffer a work-related injury or illness — so this family had to look at other options to meet their unique financial needs.

What are their options?

Emergency savings

Emergency savings are specifically earmarked to cover unforeseen situations. While emergencies cannot always be avoided, planning for such an event can help save you from derailing your financial stability.

It’s recommended to set aside at least three to six months of living expenses in an easy-to-access savings account. If you’re single and living off one income, then a six-month reserve may be necessary. If you are living in a two-income household, then a three-month reserve may be fine. If you don’t have emergency savings available to meet your needs during an unplanned circumstance, then it should be a priority to establish such an account.

A study by JPMorgan Chase of some 6 million families found that 65% percent of those surveyed lack a sufficient cash buffer. The Federal Reserve has found that “a significant share” of households would struggle to cope with an unexpected $400 expense.

Disability Insurance

Social Security Disability Insurance (SSDI) is a program supported by workers paying Social Security taxes on their earnings. For more than 60 years, this program has provided benefits to disabled workers and their dependents.

To qualify, a person’s medical condition must prevent them from doing work that they did in the past, and from adjusting to other work. Social Security does not provide partial or temporary benefits.

Social Security will replace some — but not all — of a disabled worker’s lost income.  According to Social Security, at the beginning of 2019, workers received an average monthly benefit of $1,234. This monthly payment usually only supplements lost wages and does not replace the full lost income.

At least a million people are on a waiting list for SSDI benefits.

Sick pay and PTO

A paid sick leave policy offers time off for illness and certain other situations.

PTO policy often combines sick time, vacation, and personal time into a single bank of days for employees to use when they take time off from work. This policy pools the various days into a single bank to be used at the employee’s discretion.

Employees can PTO use for vacation or save time for a later date. In California, it is mandatory that an employer allows its employees to bank their unused PTO days and save them for later. Employers can, however, place a cap on PTO accrual, so understand what that means for you.

Disability insurance

Short-term disability insurance provides some compensation or income replacement for non-job-related injuries or illnesses that render you unable to work for a limited time period.

Usually, this coverage will last three to six months. In some cases, your employer will offer this insurance to you. They may self-fund the plan, providing the benefits themselves, or work with an insurance company to provide this benefit.

Although this insurance can be purchased independently, the premium will be based on your age and level of benefits, so it may be costly.

Long-term disability insurance provides coverage if you are out of work for an extended period.

Depending on your policy, long-term care insurance will typically pay about 60 percent of your “pre-disability” earnings up until retirement age. Payments usually will not begin until time has passed following the disability, often called the “elimination period.”

Additionally, there will be an income cap on monthly earnings. This insurance may also be offset by earnings from Social Security, workers’ compensation, third-party settlements and retirement benefits.

Two types of long-term disability policies are:

Own Occupation Disability Insurance: This policy defines a disability as the inability to work at your regular occupation, even if you still might be able to work at another occupation. This is the most preferential type of policy.

Any Occupation Disability Insurance: To qualify as disabled under this policy, you must be unable to work at any occupation. This is a harder policy from which to claim benefits, but it is also usually less expensive than an own occupation policy.

When life is treating you well, it is hard to imagine it could change. But, as COVID-19 has reminded us, life can pivot quickly into something we never expected.

It’s important to address the risk of disability in your financial planning. This may include budgeting for disability insurance while you are working or for long-term care insurance for assistance with extended care costs after you retire. Your long-term financial health is worth a bit of planning.

Teri Parker is vice president for CAPTRUST Financial Advisors. She has practiced in the field of financial planning and investment management since 2000. Reach her via email at Teri.parker@captrustadvisors.com.

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