A checklist of what may be very critical to your financial future

1)  Has your advisor discussed the impact of the continuing the zero percent capital gains tax rates for some taxpayers in the 10% and 15% tax brackets for 2011? But because of the inclusion of the gains in determining the tax bracket some taxpayers could pay more than they did in prior years.

2)  Have you discussed retirement planning, estimated family income needs if you, or your spouse, have an unexpected disability or death? Is your life insurance reviewed periodically? Do you have the right amount and type of coverage? Insurance options taking advantage of the updating of the old 1980 CSO mortality table which insurance companies are required to use in calculating reserves and pricing, especially of term insurance. The new 2001 CSO tables were required starting in 2009. Overall they reflect about a 20% reduction due to mortality improvements.

3)  If you hold investments in joint tenancy with your spouse, are you aware of the income tax disadvantages of this type of ownership vs. in AZ the income tax advantages of holding investments as "Community Property with Right of Survivorship"?

4)  If you have parents still living, have you discussed Long-term care planning for them or yourself? Do you know what your options are, or what type of plan if any, may be suitable for your family’s needs? A generation ago, you retired at 65 and died at 70 or so. Today with medical advances many retirees enjoy a happy active lifestyle for 20 years or more after retirement. The family risk used to be dying too soon. Today the larger risk is living too long and using up family assets.

5)  If you seek to be responsible and protect your family from having long-term care costs wipe out family assets, has your advisor done side-by-side comparisons of different sponsor plans? Has he showed you how worthless so called "tax qualified" plans really are when you understand the facts and how it is less likely to pay you benefits and has questionable tax benefits?

6)  If you have a 401K retirement plan are you confident you have selected the best investment options? If you seek other alternatives do you know if your plan allows for "in service" rollovers to your own IRA with many more investment options? Are your beneficiaries set up properly? If you are self-employed, or have only your spouse working for you, are you aware of the benefits of a "Solo K"?

7)  Have you considered amending your Living Trust or will to reflect the estate tax exemption changes? Do you know the advantages of a Living Trust? Have you considered a provision to "sprinkle" income to children and grandchildren to shift income to lower tax brackets? Does your Trust permit the trustee to postpone distributions for good cause? This provision may protect beneficiaries from creditors or divorced spouses. Is the Marital Trust a "Qualified Terminal Income Preservation" (QTIP) trust so that a surviving spouse cannot disinherit your children if for example she remarries?

We can work with your CPA, tax accountant or attorney as appropriate.