Why business owners MUST plan ahead

The focus of our column this month is omissions. If you are a small business owner, your home and business are probably your two biggest assets, Yet it’s possible, even likely, you’ve included your home but omitted your business in your estate plan.

If you have made this omission, you’re not alone. Half of the 30 million small business owners in the U.S. have not done succession planning.

Effects of not planning

Often, the impact of this omission when a business owner dies or is incapacitated is that sales and services cease, employees don”t receive paychecks and eventually leave, and the business fails. The primary source of the family’s income is abruptly cut off.

Ultimately, the executor may be forced to shutter the doors and sell the assets at liquidation value, the lowest price possible for a business.

The effects of this omission don’t just impact distributions to beneficiaries. Long-term customers and clients may face delays and interruptions and will need to take their business elsewhere. Vendors and creditors may have to pursue collections against the estate. Sometimes, surviving spouses must file bankruptcy.

Faithful, older employees will suddenly be unemployed and too old to find other jobs. Almost half of the private workforce in this country work at small businesses.

This omission, with grim consequences for so many, need not happen. Here are steps you can take to include your business in your estate plan.

Estate planning for a business

First, make sure your primary estate planning documents — your will, living trust, and power of attorney — include your business. Your trust should state your wishes about how it should be divided upon your death and who will run it when you can’t.

If your trust is a few years old, meet with your attorney to review it. Your management team and the business itself may have changed, necessitating an update to the terms of your trust.

If you have partners or family members co-managing the company, you will want to consider utilizing a buy/sell agreement. Usually, this grants each owner or the company itself the first rights to purchase a deceased or incapacitated owner’s share, according to a pre-set valuation formula. The remaining partners or shareholders will buy out the exiting owner’s share either by directly paying the owner or the heirs.

Consider a key-person life and disability policy with the business as the beneficiary. When an owner dies or becomes incapacitated, insurance proceeds from a key-person policy can keep the business running, or be used to buy out the deceased owner’s interest.

Important for single-owner businesses

If you don’t have partners or family members to take over management, it’s essential to identify someone you trust to run the business in the short term, until it can be sold. The last thing you want is employees and family members arguing over who is in charge at such a sad and difficult time.

Your transitional manager can be a long-term employee, trusted business associate, or friend. It need not be the same person named as your trustee. The transitional manager need not be the same person who sells the business. You can select your trustee or another capable person to handle the sale.

It should be someone familiar with your company who’s level-headed with some management skills and experience. Name a second person in case your first choice is not available.

You’ll want to give your transitional manager detailed instructions and authority. They should be aware of where relevant documents are located. They should know how to be added quickly as a signer on bank accounts.

Make sure everyone involved in your business, including your key employees, attorney, banker, and CPA, have met this person and acknowledge his or her authority. It is better to have disagreements now,  while you are still  here to referee quarrels and console passed-over employees and relatives.

Go on vacation and ask your transitional manager to cover for you for a couple of weeks to work out the kinks.

Meet with your attorney to draft the appropriate documents and instructions. Allow for their compensation in your planning documents, and provide insurance or waivers to limit their liability.

Plan on retirement instead

Do not wait for death or incapacity to take a break from the business you worked so hard to build. The best advice is to plan now on selling or transferring your business interest to retire. Plan so you can pursue other interests and have some enjoyment not related to work.

Value your business now and set a timeline for your planned exit date. Work with consultants to build the value of your company to maximize the sale price. Take that overdue vacation.

Michelle C. Herting, CPA, AEP specializes in Trusts, Estates, and Business Valuations. She has offices in Riverside, Santa Monica, and Newport Beach.

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Cut out the broker, save 6%! Well, maybe not

I told the owner of my building, hey if you decide to sell, call me first. I’ll buy it and we can avoid paying the 6%”.

REALLY? This was a conversation I recently heard. I was not eavesdropping, mind you. I was the guest of a network buddy of mine at a monthly meeting of a trade organization. The conversation was between my friend and one of his clients whom I’d met previously. As I stood there with them, I recalled trying to help him last year with some space issues he was facing — for FREE!

The comment really irked me and I flippantly responded, “Yeah, by all means, cut out those greedy brokers!” The client quickly excused himself and walked away. He realized the comment struck a nerve.

I’ve thought about that encounter a lot over the past week and have tried to imagine myself in his position. If I leased a building and had an opportunity to buy it, would I “cut out the middle man?”

Indulge me and I will attempt to explain why I wouldn’t — with full disclosure that I have seen the “end of the movie.”

By the way, I believe this buyer’s sentiment is rooted in the premise that “we didn’t find the building or negotiate” the deal, so where is the value? I also believe his position is widely held by most commercial real estate occupants.

Here is the value: A commercial real estate professional can anticipate issues and structure the deal around them or formulate a suitable alternative. This is BEST done before final terms are negotiated, but sometimes we are shackled.

So let’s assume we are talking about a 20,000-square-foot building, a $4 million purchase — or a $240,000 ($4 million times 6%) dollar savings (potentially). That $240,000 represents $12 per square foot on this particular building. A lot of money for sure! However, if the buyer overpays (based upon market data that brokers track) this “savings” can be consumed quickly.

What if the property doesn’t appraise? How does the buyer bridge the gap? Brokers are skilled at finding solutions with their knowledge of market comps, current avails, etc.

What if something “untoward” is discovered such as historic hazardous materials, seismic zone, non-ADA compliance, unpermitted office or other improvements, a sprinkler system that is inadequate, a lien against title? OK, you get the idea. A seasoned professional has overcome these challenges many times before.

Who will handle the management of the deal’s execution — escrow, title, inspections, loan qualification, review of leases, estoppels, etc? A real estate attorney is trained at identifying issues, but is he or she equipped to resolve them?

What if specialized consultants are needed in the execution process? Buyers can utilize our networks.

So how do you “hear the buyer’s concerns?” Remember, the buyer is convinced you are excess baggage.

From experience, I reduce the fee and offer to manage the transaction. Specifically, in return for my involvement, the fee is 1-2%. I justify this because I didn’t find the building or negotiate the terms, just like the client believes. But, I can add significant value from the agreement forward to close.

As we know, negotiating the terms is generally the EASY part. The execution is a difficult step. Win, win, done!

Allen C. Buchanan, SIOR, is a principal with Lee & Associates Commercial Real Estate Services in Orange. He can be reached at abuchanan@lee-associates.com or 714.564.7104.

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Advice at work: Things some bosses should do but don’t

An omission is defined by Merriam-Webster as something neglected or left undone, apathy toward or neglect of duty, or the act of omitting. Last week I wrote about omissions in financial planning. Let’s talk about employees this week and what happens if you don’t try to connect with them.

First of all, let’s admit that employees in the modern era are different from those of our parents’ or grandparents’. Back then, a person worked for a company for 50 years, received a gold watch in appreciation and retired. That’s typically not the way it works today.

Workers may three or more careers in their lifetime, want life-work balance and have little loyalty to any one company. How do employer omissions affect employees? Let’s look at a few examples.

No positive feedback

Many employers expect their employees to do a good job and will only talk about performance when it’s unsatisfactory. Failing to tell them they’re doing well or about their strengths can leave the employees feeling unappreciated and less motivated.

However, a manager who communicates with workers and lets them know they ‘re on the right track gets more effort from employees. It can be done with a thank-you note, a gift card, or paid time off.

Recognizing employees’ contributions and thanking them makes them more comfortable in their jobs, boosts self-confidence, and motivates them while reinforcing a sense of purpose.

Recognizing accomplishments in front of the team, and including details of what was done right, will not only help the team grow but will also motivate others to work harder.

Good communication

Omitting vital information and not keeping everyone in the loop happens often and causes many problems. These omissions may be unintentional — like forgetting to include a name on an e-mail or forgetting to bring someone up to speed about what happened while they were away from the job.

This omission can also be strategic because the employer wants to consolidate power or exclude people. Not keeping everyone in the loop, though, can cause annoyance and even a sense of rejection. Both can lead to a loss of trust and admiration for the boss, a lack of motivation, and a loss of loyalty to the company.

Think seriously about leaving someone out of the loop and, if this was accidental, acknowledge it and quickly fix the problem.

Remember, they’re people

Instead of not visiting your employees because you’re “too busy,” take time to find out about their families, hobbies and travel plans. Let them know that family is important.

Recognize work anniversaries and birthdays. Ask what makes them feel appreciated. Is it a thank-you card, an extra day off, a bonus or something else that makes them feel appreciated? You can also share a little bit about yourself to connect with them. Shared interests will help the group work better together.

Listen to them

Ask questions and listen. Your employees might have better ways of doing things because they’re actually doing the work. They might even have suggestions on how to reorganize the workplace and make it more efficient. Ask questions about what they might need to do their jobs better, such as classes or training.

Having an early morning meeting with your team to discuss the day’s challenges can motivate the whole staff and get everyone working on the same page.

An example

About two years ago, I toured a small manufacturing plant that was about 10 years old. The employers are engineers. They create plans and figure out what the end product should look like, but their employees knew more about running the business than they did.

The employers empowered their staff to do the best job, and the employees did. Raises and pension contributions continued to increase as gross profits increased. The company has grown each year and has brought taken business back to the United States from China. This all happened because they took care of their employees in the ways mentioned above.

Start thinking about how you can avoid acts of omission as an employer. Engaging your employees can positively impact your business.

Marcia L. Campbell has worked as a CPA for over 25 years specializing in seniors, trusts, estates, court and trust accountings and probate litigation support. You can reach her at Marcia@MCampbellCPA.com.

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Estate planning: How to quit stalling and write your will

By Liz Weston, NerdWallet

You know you should have a will, but you keep stalling. No one likes to think about dying or about someone else raising their children. But if you get no further than scribbling notes or thinking about which lawyer to hire, you risk dying “intestate” — without a will that could guide your loved ones, head off family feuds and potentially save your family thousands of dollars.

Financial planners say getting people to stop procrastinating on this important money chore can be tough. I asked several advisors to offer their best strategies for getting clients to get this done. Maybe one of these will help you.


Certified financial planner Katrina Soelter of Los Angeles suggests thinking of an estate plan as “the best love letter you can write to those you love.” Providing guidance on what you want to happen after your death — and who you want to care for minor children or pets — can be a huge gift to those you leave behind. You’re also saving them the potentially large costs and delays of hiring attorneys to sort out your estate later.

Soelter says she procrastinated on her own estate planning and finds the positive approach works better than browbeating.

“It doesn’t help to heap more shame on them, but rather focus on the reasons why it is wonderful to get it done,” Soelter says.


Then again, some people need to hear worst-case scenarios before they’ll act. Financial planners often point out, for example, that without an estate plan a court could end up deciding who takes care of your kids. State law determines who inherits your stuff, and the distribution may not be as you would want.

CFP Janice Cackowski of Rocky River, Ohio, says one of her clients recently died after ignoring her advice to create a trust. His will bequeathed his estate to his financially irresponsible son, with no restrictions.

“The money my client saved over his 63-year lifetime will be gone within 18 months of his death,” Cackowski says.


CFP Kevin Gahagan of San Francisco notes that getting a basic estate plan in place may not be as complicated or expensive as you fear.

“It is the attorney who does the work,” Gahagan says. “They’ll guide you in identifying the questions you need to answer so a plan can be developed.”

Also, think about what you’d want to happen if you died in the next five years, rather than trying to create an estate plan that covers all eventualities, says CFP Karen E. Van Voorhis of Norwell, Massachusetts. You can always update and change things.


Many big companies offer their employees access to attorneys through prepaid legal services, says CFP Amy Shepard of Mesa, Arizona. That’s how she and her husband, Michael, created their estate plan. They met with an attorney affiliated with the service, which cost less than $10 per biweekly pay period when he was employed by Wells Fargo.

“For most people, the biggest thing stopping them is money,” Shepard says. “If their employer offers a legal benefit, it can make the process of doing an estate plan very affordable and very simple.”

Given that attorneys often charge $300 and up for a will, while a living trust can cost $1,200 or more, prepaid legal services can be a cost-effective option for many people, Shepard says.

Affordable options for those who aren’t offered coverage through their employer may include online services such as Rocket Lawyer and LegalZoom, which are best for people with simple situations, such as those who don’t have a lot of assets and who don’t need trusts, Shepard says. But users need to answer the sites’ questions carefully and get the resulting documents notarized, or the paperwork won’t be valid.


Van Voorhis also suggests making an appointment with an attorney now but scheduling it for a few months down the road.

“That way it’s on the books and they’ll feel like they’ve accomplished something, but they also don’t have to face it for a while,” she says.

CFP Mike Giefer of Minneapolis recommends incremental deadlines.

“By Oct. 1, have the conversation about guardians, charities and other estate intentions. By Nov. 1, have the initial meeting with an estate planning attorney. By Dec. 1, clarify and confirm the documents and have them signed before the holidays,” Giefer suggests. “On Jan. 1, 2020, they are done!”

This column was provided to The Associated Press by the personal finance website NerdWallet. Liz Weston is a columnist at NerdWallet, a certified financial planner and author of “Your Credit Score.” Email: lweston@nerdwallet.com. Twitter: @lizweston.

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Is there a law covering a person’s actions in outer space? Ask the lawyer

Q: A number of reports indicate NASA is evaluating if one of its astronauts illegally accessed her wife’s bank account while on the International Space Station. Do we have laws that control what goes on in outer space?

-S.J., Orange

Ron Sokol

A: The astronaut accused of accessing the account indicates she was simply trying to make sure there was sufficient money on hand. In any event, the location of the astronaut is not key — this is a “ground issue”; either she had the right to access or not.

The Space Station is governed by an international treaty which has a modest section on criminal jurisdiction. Specifically, each country has criminal jurisdiction with respect to its personnel, so long as that does not affect someone from a different country. If two countries get into a dispute, they are to consult with each other to determine which law is applicable. If they have not agreed in three months, the law applied is that of the government of the alleged victim.

Q: If there is an accident in outer space — such as between orbiting satellites, or an assault of some kind on a space ship — what law applies?

-V.B., El Segundo

A: More than 50 years ago, 109 nations entered into the Outer Space Treaty (OST), which sets forth guidelines on how space is to be peacefully explored. Each government is responsible for its own commercial companies and private entities. This includes objects the country launches into space, and its own personnel.

For example, an American tourist goes into space, and does something illegal. The United States should have jurisdiction over the tourist. Further, there is a part of the United States Code that pertains to criminal conduct in space. The goal is to deal with criminal issues that are outside of any nation’s jurisdiction. The covered acts, however, are notably egregious (such as rape or murder); it is unclear as to how lesser misconduct (egs., identity theft or hacking) will be handled. Bottom line, there are other international treaties than the OST that apply to outer space (such as the Moon Agreement and the Registration Convention), but like space exploration itself, the law pertaining to outer space is by no means fully completed.

Ron Sokol is a Manhattan Beach attorney with more than 35 years of experience. His column, which appears in print on Wednesdays, presents a summary of the law and should not be construed as legal advice. Email questions and comments to him at RonSEsq@aol.com or write to him at Ask the Lawyer, Daily Breeze, 400 Continental Blvd, Suite 600, El Segundo, CA 90245.

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When financial choices backfire, you can fix them

Even when we attempt to do our best thinking, our choices can backfire. Nowhere is this as impactful as your financial decisions. In fact, there is a dedicated sector of finance called behavioral finance.

This addresses why so many of us make irrational and systematic errors with money that are void of logic and soundness. It has to do with our cognitive biases. We do what we do, then rationalize it.

Are you wrestling with a facet of your money management that is compromising your financial health? It’s the small stuff that catches you unaware, but it can add up to a lot.

Here are five ways our choices may backfire because of cognitive biases and what to do about it:

1. Mental accounting. If you treat a windfall differently from your regular income, such as an inheritance from a grandparent or a large IRS return, then you’re guilty of mental accounting. This refers to the different values we may place on money based on how we acquire it. For example, a tax return can be seen as an unexpected surplus, when in fact, it’s our money in the first place!

And unfortunately, in many cases people will indulge, feeling that the unexpected doesn’t happen often. Errors such as opening a low interest-bearing account while having high credit card balances is one example. Or purchasing a new car and discovering later on how much it really costs. Treat all money the same. Be sure that if you receive unexpected money that you review your financial goals and consider how this can help you to meet them.

2. Sunk cost fallacy. Throwing good money after bad sums up this bias. The more we spend on something, the less we’re likely to let it go. This pertains to things that no longer serve us. Do you have a storage full of unused purchases from a past life that you feel are too valuable to throw away? Are you suffering from home or garage clutter because of the same?

Sunk cost fallacy says we feel guilty about ridding ourselves of what we feel was a costly purchase but we no longer use. If you no longer use it, give it away. This will save your sanity and your checkbook, especially if you are renting space for these items.

3. Retail therapy. This one is particularly tempting; another way to describe it is impulse shopping. “I work hard; I deserve this,” is a phrase one hears often in conjunction with making a sudden and unpremeditated purchase. The advice many give is to “sleep on it for 24 hours.” But you can do more to get out in front of this dangerous behavior by asking yourself how you’re feeling before you enter a store (or the Amazon website!).

If you’re bored, restless, lonely or experiencing any feeling that leaves you empty, take caution. You are vulnerable to impulse shopping. Instead, once you have identified your emotion, pick a healthier way to deal with it. This will save money and a lot of closet space taken up by shirts you’ll never wear.

4. Loss aversion. Do you panic when the stock market goes down? Do you tend to sell the positions in your portfolio so you don’t “lose it all”? This strategy will minimize the returns that you could otherwise enjoy. Work with a responsible wealth advisor who can guide you.

The advice here is to watch the market less. You aren’t abdicating your responsibility by working with someone who oversees your funds, and you should read your monthly statements and meet regularly with your advisor. However, if you are a market “stalker” and this causes panic, back away slowly and allow your professional to manage the portfolio for you.

5. Sinkhole behavior. Have you made a choice that has backfired leaving you feeling paralyzed and embarrassed? Get past it and take action. Do what you can to remedy or redirect the situation by reaching out for help.

And reach out for the right kind of help. Don’t take advice from a neighbor or someone who tells you they once had the same experience. Get help from the right kind of advisor who can look at your situation and the complete picture. They’re best suited to guide you back into the sunlight.

When a choice you have made with your finances backfires, recognize this as a pivot point to help you reassess your money behaviors so that you can redirect and move forward. Your future will thank you.

Patti Cotton works with executives, business owners, and their companies, to elevate and support leadership at all levels. Her client roster includes privately-owned businesses and such entities as Bank of America, Boeing, Coca-Cola, Harvard University, Sysco, Edward Jones, Morgan Stanley and the Girl Scouts of America.  Patti@PattiCotton.com.

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You need to move the business ASAP. Here’s how a sublease works

Your business expansion will enjoy more space very soon. Now your employees can park at their place of employment vs. down the street. Crisp new offices or tons of manufacturing space await you in the new location. You can’t wait!

You’ve opted to lease the new spot and postpone ownership. You’ll encounter two leasing scenarios once you scour the market for suitable addresses — leases and subleases. So what are the differences? Indulge me while I describe them.

Leases are negotiated directly with the owner of a parcel of commercial real estate. Therefore, they’re referred to as direct leases. Normally, your initial conversations will be through your commercial real estate professional.

The deal you get depends upon the landlord’s motivation, competition in the market and the skill with which your broker volleys. She will work with the owner’s rep to craft your agreement. Outlined will be a monthly payment amount — rent, number of years, term, increases in rent throughout the term, bumps and concessions – free or abated rent, refurbishment, and extra stuff such as tenant improvements.

An early termination right, extension rights through an option to renew, right of first refusal, or right of first offer to purchase may also be included. Once you reach a pact, you and the owner will sign a lease, you’ll deposit the requested amounts and secure insurance. Now your company can live in the new location for the agreed-upon period, let’s assume five years.

But during the lease term, something untoward occurs — a decline in sales, someone acquires your company, you decide to move your manufacturing function to China, or California imposes a huge levy on your product, which dictates a move out-of-state. You find yourself with a glut of space to which you’re committed! Now what?

Well, those circumstances, dear readers create subleases.

A sublease is akin to a remnant sale at your favorite carpet retailer. A full roll of flooring is not available, so you get to pick from what’s left. Because a finite amount remains, little flexibility exists. If the scrap fits your area, great! You benefit. But if you have a larger area to cover, you’re hosed. Also, the smaller the amount of overrun, the fewer takers. Now a price discount must be employed to liquidate. Ouch.

With a sublease, the primary motivation is to stem the bleeding. Excess space wastes rent payments. The thought of providing any concessions runs contrary to a desire to move-on. Consequently, a different dynamic unfolds compared to a direct lease. Plus, another layer of decision-makers will be involved.

Remember, a lease is in place with a landlord and a tenant. Now the tenant becomes a de facto sub-landlord and you are the sub-tenant. All parties — master landlord, sub-landlord, and you — must agree and all must approve.

So with the descriptions of leases and subleases as a backdrop — how should you proceed?

Consider all your alternatives. If you need a ton of abated rent, extensive tenant improvements, or a 10-year term, a direct lease might be your best bet. Conversely, absent these requirements, a sublease can provide you with an adequate solution.

Seek counsel. Leases are complex. Subleases are uber complex. They are not for the squeamish. If your “landlord” stiffs the owner, your sublease is in jeopardy. You’ll need two sets of approvals.

Plan on extended time frames to get all resolved. We recently encountered a sublease that took 90 days to get the nod!

Allen C. Buchanan, SIOR, is a principal with Lee & Associates Commercial Real Estate Services in Orange. He can be reached at abuchanan@lee-associates.com or 714.564.7104.

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McDonald’s tries to reheat the chicken sandwich wars with spicy barbecue sauce

Two new combatants, McDonald’s and Jack In The Box, have entered the “chicken war” launched by Popeyes Louisiana Kitchen on Aug. 12.

That’s the date when Popeyes debuted a chicken sandwich that became a runaway success. After two weeks of long lines at drive-thrus and social media frenzy, the Miami-based fast food chain announced it had run out of supplies to make the sandwiches and pulled them from its menus.

The battle lines were initially drawn by fans of Popeyes and fans of Chick-fil-A, which has been selling a very similar sandwich for decades. Wendy’s entered the fray because it had a new spicy nuggets promotion.

And now after two weeks of quiet, McDonald’s has come out with a Spicy BBQ Chicken Sandwich.

It has the same essentials as Popeyes’ and Chick-fil-A’s sandwich, a crispy chicken fillet served on a bun with a couple of pickle slices.

McDonald’s sandwich adds some raw onion and a new barbecue glaze. It costs $5.29, more than the $3.99 that Popeyes’ was charging.

Jack In The Box’s Really Big Chicken Sandwich has tomato, mayonnaise and lettuce, making it more like Wendy’s chicken sandwiches. What’s different is that it starts with two chicken patties, and customers can add one or two more if they like. It also includes bacon.

Combos cost $3.99-$5.99.

Popeyes has yet to say when it the sandwich will return. The banner on its website shows an empty sandwich wrapper with the words, “Be right back.”

But on Thursday, Popeyes launched a promotion called BYOB, “Bring Your Own Buns,” encouraging customers to buy three-piece chicken tenders and supply their own bread.

A news release announcing the promotion was accompanied by a short video featuring skeptical-looking actors.

“Seriously,” one of the actors says, “when are you bringing the sandwich back?”


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Aging seniors: Make decisions before someone makes them for you

During retirement or before, you probably did all the financial planning along with the legal paperwork. Have you also thought about personal choices as you age and the options ahead? If a personal plan isn’t made now, you might regret it when other people are making choices for you.

Here are some of your choices:

Where are you going to live?

Not moving earlier in your life to where you really want to be could stop you from moving there at a later date.

Do you want to stay in the area in which you have friends and social and religious circles that include a country club, church or charitable organizations that you have been with for a long time?

Do you want to move close to your family and expect that you will be with your relatives frequently, as when you are visiting on vacation? Another scenario is the family continues with their regular routines of work and school and activities and have little time to spend with you. In this case, you’ll have to build a circle of friends and networks.

Recreational preferences or agreeable climate and community should also come into play. If you loved visiting Hawaii, Wyoming, Arizona, Texas or Oregon, you might decide that you want to move to one of those places for those reasons or the low cost of living. If you have more time for your hobbies and interests, you might have an opportunity to live closer to where you can fulfill those interests.

There are other issues to consider in another state including income, sales, inheritance and property taxes.

Living spaces

What living space you occupy or who you live with are serious decisions to ponder before moving. If you prefer to live in your own home as you age, that comes with questions and decisions. For instance, is the house in good physical condition or does it need work to make it safe for you as you age?

Does your home have a second floor that may not be practical if can’t manage the stairs? Is your house too big for one person? Is it in a good, safe area? Do you have enough assets to support the house while you live there? Are you going to do the maintenance on the house and yard or are you going to hire help?

If you are living with someone and that person moves out or dies, are you going to be comfortable alone? If you can’t or don’t want to live by yourself, check out other housing options in the area to find something that would feel comfortable, such as senior living or assisted care facilities. You can visit and also spend some time there eating meals and participating in activities.


Seniors want the decision to stop driving to be one they make. They feel a loss of independence when they can no longer drive. How do you feel about that? Do you want to make your own decision on when to stop driving? If so, what are the criteria? California has a driver skills self-assessment questionnaire included in its DMV Senior Guide for Safe Driving.

You can start there or take a refresher driving course. However, if you decide that to give up your license, staying isolated at home isn’t your only option. There are other choices such as bus, taxis, Uber, Lyft and GoGo Grandparent that will get you around town. Some senior services will drive you places, shop for you and even order meals and deliver them.

Take Care of Yourself

It’s hard for seniors to accept they are not self-reliant anymore. Struggling with daily life as we age can lead to depression and isolation. As seniors get less mobile, they have choices to think about. Review your finances and determine if you will need additional resources.

You might consider adult daycare, home health care, local government and charitable programs that help seniors, and community centers that offer socialization, meals and activities.

Miscellaneous tips

Pre-Need arrangements: Plan your own funeral and pay for it now. You can choose burial or cremation and spend as much as you want.

Hire a professional: If you don’t have a family member or a friend that you want to make your decisions for you, or feel that they would not be able to do so, then hire a professional fiduciary. They would step in when you need them. They normally charge by the hour. Sometimes, they become the neutral party between fighting family members.

Make sure you put all of your decisions in writing and communicate them to family and friends so they know your decisions. Make an appointment with your attorney to go over the decisions you made and make sure that they’re compatible with your estate planning documents.

Look into the future for what life might look like and start making changes now. You can take responsibility for your decisions that are really yours to make. If you wait and do nothing, it can be a crisis that makes those decisions for you. You might regret your lack of making a plan for your life and the decisions may be taken out of your hands.

Marcia L. Campbell, has worked as a CPA for over 25 years specializing in seniors, trusts, estates, court and trust accountings and probate litigation support. You can reach her at Marcia@mcampbellcpa.com

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Tips on avoiding financial decisions that can backfire

How many times have you made a financial decision that backfired in the end? Maybe you intended to be helpful or the decision was made quickly, without thinking about negative ramifications. Whatever the initial circumstance, you regretted your decision later.

Think twice before you find yourself in the following situations:

Lending money to a family member or friend

According to a recent article in Forbes, nearly three-quarters of people who borrow money from friends or family never pay the loan back in full. Often these loans are by parents lending money to adult children. Chances are that when you lend money to a family member or a friend, you will never see the money again. Only lend what you’re comfortable losing. Instead of expecting to get paid back, consider it a gift.

If someone is asking you for money, evaluate the situation before committing. Here are a few questions to ask yourself:

  • Have I lent this person money before, and did they pay me back?
  • Is this an emergency?
  • Why are they coming to me instead of going to a bank?
  • Will the loss of this money affect my finances?
  • If they don’t pay me back, how will our relationship be affected?
  • Are they willing to sign a note for the loan, with market-rate interest?
  • Leasing a vehicle instead of purchasing ears

When you lease a car, you will have lower monthly payments than if you finance a car with a loan. You can transition to a new car every two to three years by simply returning the car back to the dealer at the end of your contract.

Unfortunately, you will not own the car when the lease expires. And you will need to refinance the debt or pay off the outstanding balance if you want to keep the car when the contract has reached full term. Also, you will be penalized if you terminate your lease early, exceed the allotted annual mileage (usually 12,000 miles) or damage the vehicle through excessive wear and tear.

Co-signing on a lease or loan

Co-signing a lease or loan for a family member or friend seems honorable but may have consequences. When you co-sign, you are responsible for the entire amount. Can you afford the monthly payments if the co-signee defaults? Have you thought about the effect on your credit if the person doesn’t pay on time? And you may be declined for future credit because your debt is too high or because your credit score has dropped due to late payments.

Adding an authorized user to your credit card

You may be helping someone with poor or no credit by offering access to your credit card. This good intention can quickly turn ugly, especially if your card is at the limit or the payments are not made when due. Ultimately, you’re responsible for the debt and will reap the negative repercussions.

Paying for your child’s education

As parents, we often feel that we are responsible for our children’s education even when we can’t afford it. If you did not fund a 529 Plan for your child and are now facing the reality that your teenager is about to attend college, discuss strategies with your child that will not have negative implications on your retirement. You do not want debt that will take years to pay off. Your child has his or her lifetime to repay outstanding student loans; your timeline is much shorter.

Discuss the following options with your child:

  • Taking advanced placement classes in high school with the goal of testing out of future college classes
  • Living at home while attending a local college
  • Attending community college prior to transferring to a four-year university
  • Applying for grants and scholarships
  • Working to pay for school
  • Applying for student research positions
  • Completing the FAFSA (fafsa.ed.gov) to determine what types of government aid are availableHolding an investment to avoid capital gains

If you are holding one stock in a taxable account that is a disproportionate amount of your portfolio to avoid capital gains, be careful with this approach. You may be tax-averse but could be positioning yourself for a future disaster should the value of the company quickly decline. You might want to sell some of the stock in order to create a diversified portfolio or gifting the stock to charity.

Delaying saving for retirement

This often means that you will be working well into your later years. There is not a simple solution if you are in this situation. If you are over 50 and have not established a retirement account or the one that you have is dangerously underfunded, take the time to meet with a financial advisor to implement a strategy. If you wait any longer to fund your retirement, you may have ignited a fire that you will never be able to extinguish.

Before committing to financial decisions that could negatively affect you in the long term, evaluate your position and think about your personal finances if the action backfires. Don’t be afraid to place your needs first, and learn to say no when it’s in your best interest.

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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