A Lake House Investment Dilemma, a College Savings Oversight, and a Complex Estate Planning Journey
On this week’s Money Matters, Scott and Pat guide a multi-millionaire through the decision of whether a lake house makes sense as an investment. They also help a father navigate the potential overfunding of a college savings plan. Plus, Victoria Bogner, Allworth's Head of Wealth Planning, joins the show to discuss why having the right estate plan is critical, especially for those in second marriages. She shares creative strategies to prevent unintentional disinheritance, ensure assets are properly allocated, and maximize investment potential.
Join Money Matters: Get your most pressing financial questions answered by Allworth's co-founders Scott Hanson and Pat McClain live on-air! Call 833-99-WORTH. Or ask a question by clicking here. You can also be on the air by emailing Scott and Pat at questions@moneymatters.com.
Man: Would you like an opinion on a financial matter you're dealing with? Whether it's about retirement, investments, taxes, or 401(k)s, Scott Hanson and Pat McClain would like to help you by answering your call. To join Allworth's "Money Matters," call now at 833-99-WORTH. That's 833-99-WORTH.
Scott: Welcome to Allworth's "Money Matters." Scott Hanson.
Pat: Pat McClain. Thanks for joining us.
Scott: That's right. Glad you're here with us, with my co-host here and myself, talking about financial matters and take calls and talk about some things that are going on in the world of finance.
Pat: Yes, and in today's show, we're going to be joined by Victoria Bogner. She's our head of wealth...
Scott: Wealth planning.
Pat: Talk about the importance of having the right kind of estate plan, particularly for second marriages. There are a number of people that we have on as guests of the show. The ones I...probably shouldn't say this, but the ones I really enjoy are Mark Shone, when Mark Shone comes on, I always learn something new, and when Victoria comes on. It doesn't mean that the rest of them are bad.
Scott: [crosstalk 00:01:16.052] callers.
Pat: Well, I learn something new, but internally, when people from the organization join us, every time Victoria or Mark Shone are on, I learn something new. It's like it kind of fires something...
Scott: So you're excited to see what you're going to learn from Vicky today.
Pat: I am, actually.
Scott: Victoria.
Pat: Yes. Yes. Anyway, she's going to be joining us.
Scott: Yeah, so it'll be good.
Pat: Why is it not Mark Shone on more often?
Scott: I don't know. Mark's another one of our partner advisors of out organization. What do you mean, why isn't Mark...? Pat's looking over at the booth.
Pat: I don't even know what we're going to talk to Mark Shone about, but let's get him on.
Scott: Wait, because you find him entertaining?
Pat: Yes, and he's got a recall of facts that I just find...just it's perplexing. Andy Stout has the same. They can recall numbers and facts.
Scott: I have a tendency where I can remember numbers and dates. I can't remember people's names for the life of me. I mean, it's really...actually, when I was younger, maybe I tried a little harder and now I'm like, I guess my life's gone fine if I...
Pat: You gave up.
Scott: Sorry, I got to ask your name again because you told me...
Pat: You gave up. You gave up?
Scott: I don't remember names of cities I've been to.
Pat: I just call everyone...
Scott: I just don't pay attention. It's irrelevant. I can watch a movie and who was the name of the lead character? I don't remember the name of the lead character. It's irrelevant. Why do I need to know that? But numbers stick in my brain.
Pat: When I was watching the Oscars...
Scott: You didn't watch the Oscars.
Pat: You're correct. I did not. I did not watch the Oscars. But my wife and I did...I was in the other room, but I did say, well, let's try to watch that movie and that movie. We haven't yet.
Scott: I did start watching...I'm not gonna tell you what we're watching. People aren't listening to that. I'm going to say it anyway, the O.J. Simpson trial.
Pat: I talked about it on the show.
Scott: I know you did.
Pat: I got a couple emails from people that said they watched it.
Scott: I started watching it. Well, you know, it's fun about it...I'm sorry, we are way off track. But I remember being there and being a witness to it all. But it was so long ago, I forgot most of...
Pat: A witness on television. You weren't down there.
Scott: No, no, no, no, no, no. I wasn't on the side of the freeway [crosstalk 00:03:27.894]. But I forgot a lot of those details and it all kind of coming back. And just what a big...
Pat: I got a couple emails from people that had...based on me mentioning it how they found it fascinating, and I found it fascinating.
Scott: We're not even talking about financial...
Pat: But look, I think the way we consume media news today verse if you think about...So I'm 62. Right? When when I was 8, there were four channels, ABC, CBS, NBC, and then public television. Right? And then and you were the remote, which means that if your dad or mom wanted the channel changed, you had to get up and do it.
Scott: Yeah, and there was a knob you turned.
Pat: Yeah. And now there's...
Scott: I can't even watch TV. I don't even know how to start.
Pat: ...20,000, 30,000.
Scott: Same thing with news.
Pat: Yeah, 100%. Anyway.
Scott: And financial news everywhere.
Pat: And a lot of it just pure garbage.
Scott: And the way a lot of these algorithms work, if you're sitting, strolling social media, it's confirmation bias. So if you're thinking, oh, now I should sell all my stocks and buy gold and you start going in this loop, you'll find you'll get story after story or video after video of all the reasons you should sell 100% of your U.S. stocks and put everything in gold...
Pat: Confirmation bias.
Scott: ...or whatever it is, like...
Pat: Like real estate or...
Scott: Whatever it is.
Pat: It is. Well, I don't know how we got on that, but let's let's give out our numbers and go to the calls. Are we get with that?
Scott: Yeah. To join the program, 833-99-WORTH is our number. 833-99-WORTH. Or you can send us an email at questions@moneymatters.com. And we're talking here with Benjamin. Benjamin, you're with Allworth's "Money Matters."
Benjamin: Hey.
Scott: Hi, Benjamin.
Benjamin: Hey. So I was originally...and I think I told you this, I'm not sure. I was going to call in to Dave Ramsey at first, and I just couldn't get ahold of the guy. So I'm calling because I'm pretty much a multimillionaire. I spend around $40,000 to $100,000 a month, sometimes more than that, just depending on what I spend and what I'm paying for. So I am in the process of moving a good bit of money to purchase a lake house. And I'm trying to figure out if it's a good investment. I already have a house that I live at now. I put $280,000 out of pocket into this house, fixed it up, did brand new electrical, all kinds of other crap. And I've got it appraised. And the realtors that I've had come here to my house to meet me here to also help me with the lake house thing. But they tell me, well, I put way too much money into this house because of where it's at and the houses around me bring down my value of my house.
Pat: Wait, wait, wait, wait. Can we stop for a second?
Benjamin: Yeah.
Pat: Do you plan on selling that house?
Benjamin: No.
Pat: All right. So let's let's...you know, I had this conversation with someone a couple of weeks ago about houses. And they were they were telling me, "Oh, you know, I made a lot of money on this house and this house." I said, "Like a vacation house and a primary residence?" And they said yes. And I said, "Those those aren't investments. You consume those. You consume your primary residence. You consume your vacation home."
Scott: And if your objective is to maximize your wealth, you should probably live in a little tiny house with with avocado-colored appliances from the '60s, like the cheapest thing you could find, and then go buy real estate that you turn into investment property.
Pat: That's right.
Scott: That's the way to increase your wealth.
Pat: Don't replace the popcorn ceiling or the shag carpet.
Scott: No. Ever. From maximizing your wealth. Now, you said you spend between $40,000 and $100,000 a month, right?
Benjamin: On average, sometimes more than that.
Scott: Right. And that's because you want to do things and you have the financial resources to do those things.
Benjamin: Most of the time. Yeah.
Pat: Well, what do you mean most of the time?
Benjamin: Well, like so I don't spend money all the time. It's not really every month that I spend that kind of money. But like, for example, this house that I'm getting on the lake, you know, I really like the house. Plus, it has a separate guest house. So my plan was I was going to pay for this house...and I gotta do an inspection and stuff too on it. But I was going to pay for this house within the next, I'd say, two, two-and-a-half weeks because what I'm having to do, I have an inheritance, which some people call it a trust or whatever, and that's where a lot of my money comes from.
Pat: And how big is that?
Benjamin: Millions.
Pat: Like, is it $10 million, $20 million, $30 million.
Benjamin: I don't know. I've been spending money out of it for over 10 years.
Pat: Okay. Well, look, that scares me. What you just said there scares me.
Scott: So you're spending $40,000 to $100,000 a month. If you've got 40 million bucks, not a big deal.
Pat: Whatever.
Scott: If you've got $4 million, major problem.
Pat: Big deal.
Scott: So if you really don't know, if you really don't know what the corpus, the principal amount is and the restrictions on the trust, then we don't have an answer for you.
Benjamin: Well, no, there's not really restrictions on it. I mean, it was designed for ACH, and usually what I do, like, for example...
Pat: What's ACH?
Benjamin: ...how I'm fixing up my house...Just routing an account number. So I would give companies the routing and account number. They would pull the funds out and pay for stuff and I [crosstalk 00:09:28.346].
Pat: I understand that.
Scott: But what's the principal amount? How much is in the account?
Benjamin: I don't know what the starting balance was. I can tell you...
Scott: No, what is it today.?
Pat: Yeah, what's it today?
Benjamin: Oh, I think around like $30 million. I want to say about $30 million, $40 million.
Pat: Okay, all right.
Benjamin: But like, I also have other stuff that I bought throughout the years. I have a website. I lease a nightclub, and a bunch of other stuff.
Pat: You lease a nightclub?
Benjamin: Yeah, it's $15,000 a month. I have a lease agreement for a nightclub.
Pat: Do you run a nightclub?
Benjamin: Not me specifically. I'm in Alabama. The nightclub's on Staten Island.
Pat: Is that right?
Scott: Wow. Okay. So what what's your question? It sounds to me like you've got...I mean, you're making a sound like you got unlimited capital. So do whatever you want. Like, what's your question?
Benjamin: Well, so I've had some issues moving money around a few times just because of, like, the red tape and crap. I mean, different financial institutions have different rules or whatever.
Scott: Yes.
Benjamin: And right now, I'm going through a financial advisor, essentially, meeting one on Wednesday, I'm moving $1.3 million into a [inaudible 00:10:53.164], which I did that kind of money plenty of times into different accounts. And I was going to move it into a [inaudible 00:10:59.992], and then I have to wait 7 to 10 days to transfer it from the [inaudible 00:11:03.374] into escrow to close on the property. And I was just trying to figure out...
Scott: Why don't you just transfer the money directly to the escrow? Why go through those steps?
Benjamin: Because according to them, I can't.
Pat: According to...who's them?
Benjamin: Well, I think the closing attorney I talked to, he said that if I tried to move it directly into escrow, it wouldn't work that way. They want, like, a specific...plus, I have to get the proof of funds letter. So I'm having to move it. I'm having to move a specific amount into a [inaudible 00:11:35.935].
Pat: Okay. So what's your question for us?
Benjamin: If it would be a good investment or not?
Pat: No, of course...Look, look, it's not an investment. You're consuming it. A vacation home is you're consuming it.
Scott: When you die, what happens to the principle in this trust, this $30 million to $40 million?
Benjamin: I'm not leaving it to anybody. I mean, the property I own now [crosstalk 00:12:01.830].
Scott: What do you care about what the...why don't you buy the lake property then?
Pat: Yes.
Benjamin: Well, that was my plan.
Scott: Now, go ahead.
Benjamin: I know with the property I own now, if I die, it just goes on the market, I assume.
Pat: I know. But where's the money from the proceeds of the sale go?
Scott: You got this massive inheritance from somebody. When you die, where are the dollars going?
Benjamin: I honestly don't know.
Pat: Okay. Well, that's one thing I would look at. Either name a charity or a person or whatever. Otherwise, it's...
Benjamin: You mean like a will, basically. Yeah, that's...I mean, I can do that. I'm not planning to die anytime soon.
Pat: Okay, well, no one does. So anyway, all right...
Scott: If you want the vacation house, buy the vacation house.
Pat: Yes, it's not going to matter. It's a terrible investment, by the way.
Scott: Yeah, appreciate the call, Benjamin. What do you say, terrible investment. What do you mean?
Pat: Because it's not an investment. You're consuming it. It's like saying, "My wife and I are going out for dinner tomorrow night and we're going to a really fancy restaurant. Scott, is that a good investment?"
Scott: Yes. You're investing in your relationship.
Pat: Versus why can't we go to the taqueria down the street and have a quesadilla?
Scott: It's a trade-off. It's a trade-off. You're using your dollars saying, I'm taking these assets that I have and rather than having them invested for my future, I'm going to consume them on something I want today.
Pat: And rather than consuming less by going to the taqueria and getting a quesadilla, I have decided that we're going to go all in and I've got a coupon two for one down at the Steak 'N Brew. We're going down to the Steak 'N Brew.
Scott: Your whole point is we all make decisions with our assets, but we need to ask yourself, is this truly an investment for our future, financial future? What kind of...or is this something else?
Pat: Correct. And the vacation homes are not good investments, unless you're going to convert it to a rental.
Scott: From a financial standpoint...
Pat: From a financial standpoint.
Scott: ...you're better off taking those assets and investing in something else or just having it rented out full time.
Pat: That's right. That's right.
Scott: But if you're going to own a second residence so you can pop in and out when you want to, obviously, that's not...you're taking assets that could be generating income and no longer generating income.
Pat: And that's the same way with your primary residence. If you've got an 8,000-square-foot house or 5,000-square-foot house, you could purely surely live in...I grew up in a 1200-square-foot house with 6 of us. I mean, that was fine. It was okay. I mean, you learn to fight.
Scott: You don't want to go back, my guess.
Pat: We fought over the bathroom. It'd be all right.
Scott: It truly would be all right. Honestly, like, once you've got security of shelter, security of food...
Pat: The rest is kind of bonus.
Scott: It's...yeah. Anyway. We're talking now with Anthony. Hi, Anthony. You're with Allworth's "Money Matters."
Anthony: Hey, gentlemen, it's good to see you, or speak with you, I guess.
Scott: Thank you.
Pat: Thank you.
Scott: We appreciate that. What can we do to help?
Anthony: So my wife and I believe we have over-funded our son's college savings plans. I'll give you a bit of the background and I'll lead you to the question. So we adopted our son when he was 18 months old. And when he turned 2, we opened up his ESA account and within a year opened up a 529. He's now 18. He's been accepted to an out-of-state university and he'll be leaving in six months, going there this fall.
Scott: Congratulations. Can I ask a personal question on this? Because I adopted two kids. Did you adopt him from the U.S. or was he international adoption?
Anthony: No. International, yes.
Scott: Oh, well, good for you. And him.
Anthony: Yeah. Yeah. He won the lottery that day. He just doesn't know yet.
Scott: And you did. And you did.
Pat: And you may have as well.
Anthony: Well, time will tell.
Pat: All right. So what's your question for us?
Anthony: Okay, so he leaves for university this fall. And because of GPA, he qualifies for what essentially is in-state tuition, even though it's out of state. So his tuition is going to be about $16,000 a year in the state he's going to, round it to $20,000 for incidentals and whatever.
Scott: Plus room and board.
Anthony: Okay. Yeah. In his 529 plan...
Scott: No, no. So the tuition is 16 grand, but then you've got room and board, another $12,000 or something?
Anthony: No, no, no. That's $16,000...that's tuition, room and board.
Scott: Oh, wow.
Pat: Okay. It's cheap. Okay.
Anthony: Yeah. Okay. So in his 529 plan, we have $43,000. In his ESA, we have $250,000. If the market stays slightly positive, he's essentially going to earn, or we will, you know, enough to cover that cost for the next four years, assuming he makes it four years. So we are in a situation where we think we've over-funded. He's 18, going on about 15. He is not financially or fiscally mature enough to handle a quarter-million-dollar windfall when he graduates. We don't want to roll it into a retirement account for him. We want to spend the money.
Scott: Why?
Anthony: So it was our sacrifice, delayed gratification for 20 years to build up to this. So we know we can take out non-qualified distributions subject to ordinary income tax plus a 10% penalty. That's like our worst bad idea or best bad idea, I guess. So my question is, are there any other creative suggestions?
Scott: And you have no other kids?
Anthony: No other kids.
Pat: And do you need...
Anthony: This is the last one?
Pat: I understand you want to spend the money. Do you need to spend the money? Do you need this to fund any of your...Not want. Do you need this to spend any of your retirement or lifestyle today?
Anthony: No.
Pat: Okay. So...
Scott: Do you want to? I mean, do you want these dollars to increase your standard of living right now?
Anthony: Not necessarily.
Scott: Or is your motivation you just don't want the big chunk of money to go to your kid when he's too young and immature?
Anthony: It is definitely that for sure. But also we want to have some fun with it. I mean, our retirement plans are in good shape. We are retired now. My wife is essentially retired. We're still pretty young. So, you know, travel. I mean, we jokingly say by a big motor home, we don't really want one. But that's [crosstalk 00:18:47.297].
Scott: Rent one first.
Pat: Just to test the marriage.
Scott: A few times.
Pat: How much money do you have set aside in retirement plans?
Anthony: Total there is about $2 million and about a half a million equity and a paid-for home.
Pat: And are you taking income off of those retirement plans?
Anthony: Yes, not yet drawing Social Security.
Scott: How old are you?
Anthony: I'm 63. My wife is 58.
Pat: So have you looked at moving that ESA to the HSA?
Anthony: That's sort of an information gap for me. I don't know enough about it to give you an informed answer.
Scott: You can move an education savings account to a health savings account?
Anthony: Oh, I'm sorry.
Pat: No, no, no, no. Wait, wait. I'm thinking 529. I'm sorry. I misspoke. So have you looked at moving the ESA to a 529 plan?
Anthony: No, we have not.
Pat: Okay, so here's how I think about this. Here's how I think about this. The ESA, if you moved it to the 529 plan, you'd have to leave it there, I believe, for five years before you can start taking withdrawals. But there's no hurry to spend it. Once it's in the 529 plan, it's yours. Right? You own it. He's beneficiary of it. Okay.
Anthony: Well, okay. Clarify that for me. It's in custody for him. But I'm saying that upon his 21, it is his.
Pat: That's correct.
Scott: On the I'm not an expert on ESAs.
Pat: So I don't know if the ESAs...
Scott: They weren't utilized much at all.
Pat: They were only around for a few years. But the ESA to a 529 plan...
Scott: Did you fund this like a lump sum when he was a child?
Anthony: The 529, we did a lump sum and the ESA, we had a little bit of unused funds from two prior kids that we sort of jumpstarted it with. And then we had annual contributions for a few years. And then sitting down with a financial advisor, one year we looked at it and said, we probably don't need to fund anymore. And we all agreed and we just stopped. It's just grown from there. Sixteen years of growth can be an amazing...
Pat: Oh, I know that's right.
Scott: Yeah, for sure. And it's also one of the benefits as an investor is you live longer, you see the benefit of compound interest. Like, it's pretty incredible.
Pat: So you can you can move this over, the ESA to a 529. So you...
Scott: Can we change the beneficiary?
Pat: You cannot. You need to complete a transfer and asset form. I don't know the answer to that. So what I would look at is I'm not...
Scott: I've never talked to anyone with $250,000 in an ESA. You're the first person I've ever encountered with $250,000 in an ESA.
Pat: Yes. So here's the...I know I would move it from the ESA to 529. What I don't know is the 529 plan must have the same beneficiary is the Coverdell ESA. So the beneficiary...So what happens, I don't know if the restrictions on the ESA actually transfer into the 529 or they go away.
Scott: Yeah, it's going to take more research than this program.
Pat: Right. So if in fact that gets rid of that, then I would leave it in the 529 forever. I wouldn't be in a hurry to take it out of the 529 plan.
Anthony: Except so it becomes his at age 21.
Pat: So that's what I don't know. Under the ESA...
Scott: We don't know...
Pat: Under the ESA, it becomes his at 21.
Scott: I'm no expert on ESAs.
Pat: But the 529 plan, I don't know whether the ESA rules follow into the 529s. I suspect that they probably do. So your thinking is that you're going to take this money out and pay the taxes and penalties and spend it before it gets to 21.
Anthony: If we start maybe like in a year or two. And because we're retired and we don't have any income...
Pat: I like it.
Anthony: ...there's a certain amount we could take and just accept the 10% penalty, take enough that we're drawing it down, but not so much we create a huge tax burden all in one year.
Pat: I agree with you. I agree with you. I agree with you.
Scott: Yeah, I wouldn't touch the 529. Because you can change beneficiaries on the 529.
Pat: You could move it to grandchildren.
Scott: You can wait until you got a grandkid. Yeah. And you can move to several grandkids.
Pat: But so what I don't know the answer to, which is going to take more research, is does the ESA beneficiary has to be the same to 529 plan if you move to a 529 plan? I don't know if you're restricted from changing the beneficiary at some point in time. My guess is that you probably are, but that's going to take some research. My assumption would be that that that's going to be his and that the changes are going to take place. So I like your idea otherwise. So I'd ask either a tax accountant or your financial advisor, what are the ESA to the 529 plans? Do they stay in place? Does it have to cover that Coverdell all the way through the 529 plan? And if they come back and say, yes, it does, then the idea of just taking the money out and spending it and paying the 10% penalty, I'd do it all day. I mean, all day. You know, otherwise, you don't want your 21-year-old to get this money.
Scott: No, of course not.
Anthony: Yeah. And he does not know it exists and we just prefer to keep it that way. And then as he goes through life and matures and we see opportunities, you know, then we can decide when and how to [crosstalk 00:24:55.224].
Scott: I completely understand.
Pat: I knew a kid that he got his retirement or he got his college...He never went to college, but got the money. And he bought this beautiful red Karmann Ghia. This kid growing up. I mean, it was...Right? You look back at it now and I'm like, "Where did you get the Karmann Ghia?" It's like, "Oh, my parents saved all this money for my college and I got it." And this beautiful red Karmann Ghia, like, oh, everyone loved it. He didn't own that thing three weeks before he wrecked it. Right? And that's kind of what you want to...
Scott: Well, most young people are more interested in car catalogs than college catalogs. Right? I mean, that's reality.
Pat: And you want to avoid the Karmann Ghia story. Correct?
Anthony: Yes, exactly.
Pat: Yeah. So yeah, you're going to pay the 10% penalty. You're not going to like it, but...
Scott: I mean, in retrospect, the 529 certainly would have been a better option. But that's where we are, so.
Pat: It doesn't matter now, so.
Anthony: All right. I was hoping to...I mean, that's when I thought I would hear, so.
Scott: Yeah. I mean, before, I would do a little more research. Like we said, we're not experts in the...
Pat: I would see of the ESA follows through to the 529. And I suspect that it does just because it says the beneficiary.
Scott: I would think...I mean, I can't imagine it because the other areas....
Pat: Yeah, it falls through. So anyway, appreciate the call.
Scott: Yeah, wish you well.
Anthony: All right. Thank you very much.
Scott: Well, we're going to turn a bit right now. I have an interview with Victoria Bogner. Vicky's been on the program, what, two or three times over the last couple of years or whatever.
Pat: Yeah, at least.
Scott: She joined us...and we've talked about this program...Both Pat myself, we've been financial advisors for decades. We started an independent firm 30-some years ago called Hansom McClain for most of its existence. We rebranded that, I don't know, five, six years ago to Allworth.
Pat: To Allworth.
Scott: And then we've grown in part from, you know, clients get referred in by their existing clients, etc. Then we've also grown quite a bit by other firms partnering with us. And you're seeing this across the independent wealth management industry, mainly because these larger firms can offer a lot more services to clients than little mom-and-pop shops.
Pat: Yeah. So like, when we came up with this concept years ago and we started adding other firms, we went out, outside capital, and got some outside capital. But we've added tax services and estate planning services and...
Scott: Insurance analysis.
Pat: ...insurance analysis and more high net worth...
Scott: Medicare planning.
Pat: ...and Medicare. So all these things that are actually the clients need. But unless you get enough advisors and clients to spread them out...
Scott: But then we've also discovered the best advisors don't want to come work for somebody. They already have something good going on in their life. Right? So when they join, when they partner with us, it's a way that we've been able to track some of the best talent in the country, frankly, you get phenomenal people like Vicky Bogner.
Pat: Yeah. And then Vicky gets the fact that she doesn't have to...she gets a lot of autonomy, but doesn't have to run a small business on a day-to-day basis.
Scott: And spends time doing things that adds the most value to clients.
Pat: So that's our thesis anyway.
Scott: And it seems proven out with Vicky. Vicky, thanks for joining us today.
Victoria: Yeah. Thank you so much. And you're spot on, I was CEO of my prior firm. And I love working in the business, not so much on the business as far as doing all of the day-to-day stuff of running a small business. You're spot on. It's been one of the best decisions?
Scott: What educational designations do you have?
Victoria: I'm a certified financial planner, a chartered financial analyst, and an accredited investment fiduciary.
Pat: Okay, so a bunch more than I have.
Scott: Is that right?
Pat: A lot more initials behind your name.
Scott: I actually had one that I dropped. I didn't feel like paying the 100 bucks a year. Like, how many do I need?
Victoria: When it starts running off the edge of your business card, yeah, you pare it down.
Scott: Yeah. And so you are the head of wealth planning at Allworth.
Victoria: That's right. Yes. So I get to use my skill set to help all of our clients here at Allworth, especially our high-net-worth clients. And we're getting more and more folks who are realizing that this is the place to be if you have assets over $5 million.
Scott: So you're going to tell us about someone that you recently worked with and some strategy planning. So please share with us.
Victoria: Exactly. What's great about Allworth is, as you mentioned, we have estate planning, tax planning, insurance planning in-house, which means that when you're working with an advisor, you're actually working with a team of people and looking at your complete situation and working in tandem toward what is in your best interest. So this particular client...
Scott: Are you the head of wealth planning or are you on the marketing team? So where are you from? Someone [crosstalk 00:29:46.671] get a pitch.
Victoria: You know how much I believe in Allworth's value proposition. Yeah. So these clients, I'll call them John and Rebecca, but these are clients of mine that this is a very common situation. It was their second marriage, and they each had grown children from their prior marriages. Rebecca had one grown child and John had two. So the very common issue is, how do I make sure that my spouse is taken care of? But ultimately, I want my assets to pass to my kids, not necessarily my spouse's kids from the prior marriage, right?
Scott: Yeah. Well, and I tell you, Vicky, I know you've seen this because we've seen it. People sometimes they get unintentionally disinherited.
Pat: Yes.
Victoria: Yes.
Pat: Or thrown out of the house. Or thrown out of the house.
Victoria: Right. It's an issue.
Scott: You've seen that obviously [crosstalk 00:30:39.517].
Victoria: You can have a lot of handshake understandings, but really you want to get it down in your estate plan exactly what you want to have happen with those assets. And these folks, their estate was about $8 million, which right now isn't bumping up against that estate tax exemption, but if that gets slashed in half at the end of this year, then they will. So it's another consideration. So if you're listening right now and you're in a second marriage and you have kids from prior marriages, listen up. This is important for you to know. A common way for you to make sure that your assets ultimately go where you want them to is to use...And by the way, let me preface this by saying, I'm not offering legal advice here. You need to consult an estate attorney. We have a state specialist here on staff. But part of my job as a financial planner is to give you advice in accordance with your total plan.
So commonly, people in this situation will use separate revocable trusts. So they each set up a revocable trust. And then that would feed into what's called a bypass trust or a QTIP trust or a combination of both. And I know we're getting a little bit into a complex area, but I want you to hear this because this is why it's so important to have a financial planner involved in this, because each kind of trust has different tax implications. So for instance, a bypass trust, how that works is as the spouse with your assets, you get to say, okay, if I die first, then my spouse gets to use this amount of assets during their lifetime. But when they die, what's left in my bucket goes to my kids, my grandkids, whoever you want.
Scott: And Vicky, this applies not just to second marriages, right? Because it could be a first marriage where husband and wife, they have different ideas where they'd like to see their assets go when they pass.
Victoria: Absolutely, absolutely. So this is used in a lot of use cases. This is just the most common. But what happens with a bypass trust is that first, those assets are completely removed from the surviving spouse's estate, right? So when that first spouse dies, it goes into this trust. It is not a part of that surviving spouse's estate. So what that means is if those assets grow to be $30 million, when that second spouse dies, it's not a part of their estate. There's no estate tax on those assets. So that's huge. If you have a portfolio that's above the state estate tax exemption limit and it's going to grow in value over time rapidly, but also that means...
Pat: I'm sorry, Vicky, but it doesn't receive a step up in basis once it's been put in...
Victoria: I was just going to say that. But it doesn't get a step up in basis at that second spouse's death. So in general, it makes sense to put perhaps qualified assets in there, qualified high-growth assets, because those qualified assets in an IRA or something like that aren't going to get a step up in basis anyway.
Scott: Qualified meaning IRAs, 401(k)s.
Victoria: Correct. Yes. Or even Roth assets, right? So that's how to benefit from a bypass trust, but also a QTIP, and that stands for qualified terminable interest property, we call it QTIP for short, that doesn't remove assets from the second spouse's estate. It does defer the estate taxes, but it keeps it in that second spouse's estate because then it does come with a step up in cost basis at the second spouse's death. So it might make sense to put taxable accounts or real estate into that kind of trust.
Pat: And especially if...Would a QTIP work if you...second marriage, right, I bring the house into the marriage. One person brings the house in the marriage, allows the surviving spouse to live in that house until death, in which case it then passes on to the first spouse's descendants.
Victoria: Correct, or whoever they wanted to leave it to, or might even be a portfolio of investment properties or, you know, a plethora of different things. But what's most important is that when you're working with an estate attorney, it's not common, maybe they're superstars, but it's not common that they would know the tax implications behind all of these decisions. That's why you need your financial planner on that team. And with the right estate plan in place, the decision of what assets flow through to which kind of trust can be made at the time of the first spouse's death because, of course, the right answer depends on the laws at that time, your asset levels, the estate tax exemption amount at that time. So having a financial advisor with the knowledge of your entire financial plan, your goals, your legacy wishes, incredibly important to make sure that what you want to have happen actually happens.
Scott: And so with your clients, your real life clients that you changed to John and Stacy or whatever...
Victoria: John and Rebecca.
Scott: John and Rebecca, what did you end up doing? What was the plan with these two?
Victoria: With these two, we met with an estate attorney who also happens to be a good friend of mine, did my estate plan, but we set up revocable trusts for each of them. And then we also set up bypass and QTIP trusts for each of them so that when one of them passes away, at that time we can decide, okay, what makes the most sense for which assets to go where, depending on the estate tax exemption at that time, where taxes are, and what the income needs are. So it's all set up. It's all in place. They have a little bit more of a complicated situation because John, one of his kids is a spendthrift. So we have some provisions in there for that. And then if they have grandkids, we have provisions in there so that they're not subject to the generation skipping tax, which is a whole nother thing. So just even more reason to have a financial advisor who's knowledgeable in these things involved in these conversations.
Pat: So how many...So it sounds like you set up six trusts. Three each, three each, but did you only fund one of them?
Victoria: We only funded the revocable trust.
Pat: So you funded two, one for each.
Victoria: Correct. So you've got three trusts for each...
Scott: And by fund, it just means you put the assets in that [crosstalk 00:37:26.876] and changed the title.
Pat: So how do we know that at the first death that the decedent's wishes are followed?
Scott: John dies.
Pat: John dies. How do we know Rebecca is going to actually...is going to fund those?
Victoria: Because in the language of the revocable trust, which becomes irrevocable at a spouse's death, inside of that trust, number one, it names me as the financial planner over those assets, which means that I can be of help to Rebecca or John, whoever passes away first. But inside that trust, it has the language that these assets need to go into either the bypass, the QTIP, or a combination of both as per the recommendation of the estate attorney and the financial advisor, which is myself. So there's no way that Rebecca or John could go in there and say, "You know what? I'm just going to pull these out and use it for myself." It's very clear language in there.
Pat: Okay, so let's think about this, right? So John dies, Rebecca says, "Nah, I don't want to use that." Is it the beneficiaries that would actually bring action against Rebecca?
Victoria: If Rebecca actually did that, she would be going...I don't know how she would even do that, because she wouldn't have access to the trust.
Pat: She's defrauding the trust. Okay.
Victoria: Because [crosstalk 00:39:02.915] trust at that point. And then you have to distribute those assets according to the trust, right?
Pat: Got it. And you would just go...
Scott: So I remember a situation. This is probably 25 years ago. Second marriage. He dies relatively young, had a will. Most of his assets...I'm trying to remember exactly. They had the house. Most of his assets were in an IRA rollover. He had a will that he wanted his kids...yeah, I think it was his grandkids' education to be funded at X dollars, but never created any legal documents to structure this. So at his death, there was no irrevocable trust set up. And his ex-wife, I watched over the next decade. ..
Pat: Oh, spend down the money.
Scott: Yeah. Spend...
Victoria: Oh, no. And that's why it's so important to have separate revocable trusts.
Scott: So her half, she didn't touch, kept letting it grow and grow and grow. And his half, she kept spending down.
Pat: Because there weren't enough restrictions...
Pat: And she didn't like his kids.
Pat: And there weren't any restrictions on the irrevocable...
Scott: And I remember thinking, this is not really cool, but there's nothing...
Victoria: Yeah, that's why you have to have separate revocable trusts.
Scott: So Victoria, this was $8,000, $10,000, $15,000 for these clients to go through to this little [inaudible 00:40:32.209] at the estate planning attorney.
Victoria: Yeah, I mean, I live in the State of Kansas. It's not California, so it might be a little different depending on where you live. But yeah, it was not...it was extremely important to do. But it cost, you know, $8,000 to put this in place. However, I will say that this was before we joined Allworth. And now that we're with Allworth, we have a lot more tools at our...you know, for us to use as advisors that would have brought that bill down significantly for our clients that are over $5 million in assets that we're managing. So that is just some of the, you want to say, perks that we have for high-net-worth [crosstalk 00:41:21.238].
Scott: No more pitching. Thank you.
Pat: Well, it is true. It is true, but...All right, that's interesting, Victoria. Right? And how hard was it to get them involved in the conversation? With living trusted wills, what I have found with my clients was, "Well, we'll get to it. We'll get to it. We'll get to it." Until I've actually had them...
Scott: I actually today have a call with an estate planning attorney on my own estate on something I've been thinking the last few years. I need to address this. I need to address this. I need to address this. But I'm not dying today. Right? No one's dying today. So it's the type of thing it's so easy to put off.
Pat: How hard was it to involve them in this conversation, the clients?
Victoria: Oh, it probably took three years of nagging.
Pat: Isn't that funny?
Victoria: That's also part of my job, right? Yeah. You have to make sure your clients follow through with what's in their best interest. It's like, "Okay, guys, we have got to get this done." And it's part of thinking through, "Okay, Rebecca, imagine if you die and the way it's set up right now, everything just goes to John. And you're trusting him. And I know that you love him. He's a great guy. You're trusting him that he's just going to keep track of all your stuff and do right by you. But he has this spendthrift kid, who knows how much he's going to have to help him out. You know, he might blow through those assets over the next 10 years. He might get remarried. You just don't know. So can we just get this buttoned up so that you know exactly what's going to happen?"
Scott: I think it's important. It's important. I mean, even on first marriages, it can be important because, I mean, you've seen people do kind of crazy things when their spouse passes away.
Pat: Oh, yes.
Scott: Right?
Pat: Oh, yes. Suddenly they're remarried in nine months to somebody the family doesn't even think is a wise idea.
Scott: Oh, yes. Oh, yes. I mean, I actually...I'm going through the Rolodex in my brain right now about like, okay, that one? Yeah.
Pat: Yeah. Go on.
Scott: Like, he married that lady and I said to him, "Are you sure that you need to get married this soon?"
Pat: Big age gap, has her own kids, not employed. We've seen those things.
Scott: Yeah. Yeah. Anyway.
Victoria: Yeah. And so important to know that wills are not good enough, right? That beneficiaries on assets trump wills. So regardless of what you think your will can do for you, if you've marked somebody as a beneficiary on an IRA, that trumps the will.
Pat: Again, again, and supersedes. Supersedes.
Victoria: Supersedes. Yes.
Pat: We don't use the word trump.
Victoria: We don't use the word trump anymore. Different connotations.
Scott: Make this apolitical.
Victoria: Yeah, sorry. Supercedes.
Pat: All right. Thank you very much. As always, glad you are part of the team. And Scott and I will see you in the next couple of weeks. And we've got an educational program going on in Fort Worth, Texas, so.
Scott: I don't think I've ever been to Fort Worth. I've been to...Appreciate the call to join us, Vicky. I've been to Dallas a number of times. And if you don't live in Texas, Dallas, Fort Worth sounds like the same thing. But you talk to people from Texas, they say they're very different cities and don't confuse the two.
Pat: That's right.
Scott: And I don't think I've ever been to Fort Worth.
Pat: We were there and watched that...there was some sort of...they ran cattle down the street for something, something or other. I guess they do it once or twice a week or something. It's...
Scott: Not like the chasing of the bull in Spain.
Pat: Yeah, it was exactly that. That's exactly what it was.
Scott: Pat's running to escape the bull. I don't think that's what happens in Fort Worth.
Pat: No.
Scott: As we're wrapping up, wanna let let you all know, we've got a great workshop, Advanced Wealth Strategies for High-Net-Worth Investors. This is our first live, in-person workshop for 2025. I'm sorry, it's only in two markets right now. It's in the Sacramento area and the Cincinnati areas. But our experts are going to share advanced tactics for high-net-worth investors that they can use to preserve their wealth. Also, some advanced strategies we use with our own clients whose wealth maybe sometimes needs a little more sophisticated approach. And we're going to be talking about taxes designed to help create reliable streams of income, mitigate your tax burden, and get more of your portfolio. So the Sacramento and Cincinnati areas, March 26th and March 29th. Again, March 26th, March 29th. It's free, but you need to go to allworthfinancial.com/workshops. And seats in both these areas are filling up quickly. We do have some that they sell out. They're free, but they sell out. So if you want to reserve a space, I would do that. You can get all the information again at allworthfinancial.com/workshops.
It's been a pleasure having you all with us today as we've talked about financial matters. And so, appreciate you. By the way, if you like this program, go follow us. Make sure you follow us. Not just download when you want, but follow us. That would be helpful and give us a review. So anyway, it's been great having you with us. It's been Scott Hanson and Pat McClain of Allworth's "Money Matters."
Man: This program has been brought to you by Allworth Financial, a registered investment advisory firm. Any ideas presented during this program are not intended to provide specific financial advice. You should consult your own financial advisor, tax consultant, or estate planning attorney to conduct your own due diligence.
Scott: Welcome to Allworth's "Money Matters." Scott Hanson.
Pat: Pat McClain. Thanks for joining us.
Scott: That's right. Glad you're here with us, with my co-host here and myself, talking about financial matters and take calls and talk about some things that are going on in the world of finance.
Pat: Yes, and in today's show, we're going to be joined by Victoria Bogner. She's our head of wealth...
Scott: Wealth planning.
Pat: Talk about the importance of having the right kind of estate plan, particularly for second marriages. There are a number of people that we have on as guests of the show. The ones I...probably shouldn't say this, but the ones I really enjoy are Mark Shone, when Mark Shone comes on, I always learn something new, and when Victoria comes on. It doesn't mean that the rest of them are bad.
Scott: [crosstalk 00:01:16.052] callers.
Pat: Well, I learn something new, but internally, when people from the organization join us, every time Victoria or Mark Shone are on, I learn something new. It's like it kind of fires something...
Scott: So you're excited to see what you're going to learn from Vicky today.
Pat: I am, actually.
Scott: Victoria.
Pat: Yes. Yes. Anyway, she's going to be joining us.
Scott: Yeah, so it'll be good.
Pat: Why is it not Mark Shone on more often?
Scott: I don't know. Mark's another one of our partner advisors of out organization. What do you mean, why isn't Mark...? Pat's looking over at the booth.
Pat: I don't even know what we're going to talk to Mark Shone about, but let's get him on.
Scott: Wait, because you find him entertaining?
Pat: Yes, and he's got a recall of facts that I just find...just it's perplexing. Andy Stout has the same. They can recall numbers and facts.
Scott: I have a tendency where I can remember numbers and dates. I can't remember people's names for the life of me. I mean, it's really...actually, when I was younger, maybe I tried a little harder and now I'm like, I guess my life's gone fine if I...
Pat: You gave up.
Scott: Sorry, I got to ask your name again because you told me...
Pat: You gave up. You gave up?
Scott: I don't remember names of cities I've been to.
Pat: I just call everyone...
Scott: I just don't pay attention. It's irrelevant. I can watch a movie and who was the name of the lead character? I don't remember the name of the lead character. It's irrelevant. Why do I need to know that? But numbers stick in my brain.
Pat: When I was watching the Oscars...
Scott: You didn't watch the Oscars.
Pat: You're correct. I did not. I did not watch the Oscars. But my wife and I did...I was in the other room, but I did say, well, let's try to watch that movie and that movie. We haven't yet.
Scott: I did start watching...I'm not gonna tell you what we're watching. People aren't listening to that. I'm going to say it anyway, the O.J. Simpson trial.
Pat: I talked about it on the show.
Scott: I know you did.
Pat: I got a couple emails from people that said they watched it.
Scott: I started watching it. Well, you know, it's fun about it...I'm sorry, we are way off track. But I remember being there and being a witness to it all. But it was so long ago, I forgot most of...
Pat: A witness on television. You weren't down there.
Scott: No, no, no, no, no, no. I wasn't on the side of the freeway [crosstalk 00:03:27.894]. But I forgot a lot of those details and it all kind of coming back. And just what a big...
Pat: I got a couple emails from people that had...based on me mentioning it how they found it fascinating, and I found it fascinating.
Scott: We're not even talking about financial...
Pat: But look, I think the way we consume media news today verse if you think about...So I'm 62. Right? When when I was 8, there were four channels, ABC, CBS, NBC, and then public television. Right? And then and you were the remote, which means that if your dad or mom wanted the channel changed, you had to get up and do it.
Scott: Yeah, and there was a knob you turned.
Pat: Yeah. And now there's...
Scott: I can't even watch TV. I don't even know how to start.
Pat: ...20,000, 30,000.
Scott: Same thing with news.
Pat: Yeah, 100%. Anyway.
Scott: And financial news everywhere.
Pat: And a lot of it just pure garbage.
Scott: And the way a lot of these algorithms work, if you're sitting, strolling social media, it's confirmation bias. So if you're thinking, oh, now I should sell all my stocks and buy gold and you start going in this loop, you'll find you'll get story after story or video after video of all the reasons you should sell 100% of your U.S. stocks and put everything in gold...
Pat: Confirmation bias.
Scott: ...or whatever it is, like...
Pat: Like real estate or...
Scott: Whatever it is.
Pat: It is. Well, I don't know how we got on that, but let's let's give out our numbers and go to the calls. Are we get with that?
Scott: Yeah. To join the program, 833-99-WORTH is our number. 833-99-WORTH. Or you can send us an email at questions@moneymatters.com. And we're talking here with Benjamin. Benjamin, you're with Allworth's "Money Matters."
Benjamin: Hey.
Scott: Hi, Benjamin.
Benjamin: Hey. So I was originally...and I think I told you this, I'm not sure. I was going to call in to Dave Ramsey at first, and I just couldn't get ahold of the guy. So I'm calling because I'm pretty much a multimillionaire. I spend around $40,000 to $100,000 a month, sometimes more than that, just depending on what I spend and what I'm paying for. So I am in the process of moving a good bit of money to purchase a lake house. And I'm trying to figure out if it's a good investment. I already have a house that I live at now. I put $280,000 out of pocket into this house, fixed it up, did brand new electrical, all kinds of other crap. And I've got it appraised. And the realtors that I've had come here to my house to meet me here to also help me with the lake house thing. But they tell me, well, I put way too much money into this house because of where it's at and the houses around me bring down my value of my house.
Pat: Wait, wait, wait, wait. Can we stop for a second?
Benjamin: Yeah.
Pat: Do you plan on selling that house?
Benjamin: No.
Pat: All right. So let's let's...you know, I had this conversation with someone a couple of weeks ago about houses. And they were they were telling me, "Oh, you know, I made a lot of money on this house and this house." I said, "Like a vacation house and a primary residence?" And they said yes. And I said, "Those those aren't investments. You consume those. You consume your primary residence. You consume your vacation home."
Scott: And if your objective is to maximize your wealth, you should probably live in a little tiny house with with avocado-colored appliances from the '60s, like the cheapest thing you could find, and then go buy real estate that you turn into investment property.
Pat: That's right.
Scott: That's the way to increase your wealth.
Pat: Don't replace the popcorn ceiling or the shag carpet.
Scott: No. Ever. From maximizing your wealth. Now, you said you spend between $40,000 and $100,000 a month, right?
Benjamin: On average, sometimes more than that.
Scott: Right. And that's because you want to do things and you have the financial resources to do those things.
Benjamin: Most of the time. Yeah.
Pat: Well, what do you mean most of the time?
Benjamin: Well, like so I don't spend money all the time. It's not really every month that I spend that kind of money. But like, for example, this house that I'm getting on the lake, you know, I really like the house. Plus, it has a separate guest house. So my plan was I was going to pay for this house...and I gotta do an inspection and stuff too on it. But I was going to pay for this house within the next, I'd say, two, two-and-a-half weeks because what I'm having to do, I have an inheritance, which some people call it a trust or whatever, and that's where a lot of my money comes from.
Pat: And how big is that?
Benjamin: Millions.
Pat: Like, is it $10 million, $20 million, $30 million.
Benjamin: I don't know. I've been spending money out of it for over 10 years.
Pat: Okay. Well, look, that scares me. What you just said there scares me.
Scott: So you're spending $40,000 to $100,000 a month. If you've got 40 million bucks, not a big deal.
Pat: Whatever.
Scott: If you've got $4 million, major problem.
Pat: Big deal.
Scott: So if you really don't know, if you really don't know what the corpus, the principal amount is and the restrictions on the trust, then we don't have an answer for you.
Benjamin: Well, no, there's not really restrictions on it. I mean, it was designed for ACH, and usually what I do, like, for example...
Pat: What's ACH?
Benjamin: ...how I'm fixing up my house...Just routing an account number. So I would give companies the routing and account number. They would pull the funds out and pay for stuff and I [crosstalk 00:09:28.346].
Pat: I understand that.
Scott: But what's the principal amount? How much is in the account?
Benjamin: I don't know what the starting balance was. I can tell you...
Scott: No, what is it today.?
Pat: Yeah, what's it today?
Benjamin: Oh, I think around like $30 million. I want to say about $30 million, $40 million.
Pat: Okay, all right.
Benjamin: But like, I also have other stuff that I bought throughout the years. I have a website. I lease a nightclub, and a bunch of other stuff.
Pat: You lease a nightclub?
Benjamin: Yeah, it's $15,000 a month. I have a lease agreement for a nightclub.
Pat: Do you run a nightclub?
Benjamin: Not me specifically. I'm in Alabama. The nightclub's on Staten Island.
Pat: Is that right?
Scott: Wow. Okay. So what what's your question? It sounds to me like you've got...I mean, you're making a sound like you got unlimited capital. So do whatever you want. Like, what's your question?
Benjamin: Well, so I've had some issues moving money around a few times just because of, like, the red tape and crap. I mean, different financial institutions have different rules or whatever.
Scott: Yes.
Benjamin: And right now, I'm going through a financial advisor, essentially, meeting one on Wednesday, I'm moving $1.3 million into a [inaudible 00:10:53.164], which I did that kind of money plenty of times into different accounts. And I was going to move it into a [inaudible 00:10:59.992], and then I have to wait 7 to 10 days to transfer it from the [inaudible 00:11:03.374] into escrow to close on the property. And I was just trying to figure out...
Scott: Why don't you just transfer the money directly to the escrow? Why go through those steps?
Benjamin: Because according to them, I can't.
Pat: According to...who's them?
Benjamin: Well, I think the closing attorney I talked to, he said that if I tried to move it directly into escrow, it wouldn't work that way. They want, like, a specific...plus, I have to get the proof of funds letter. So I'm having to move it. I'm having to move a specific amount into a [inaudible 00:11:35.935].
Pat: Okay. So what's your question for us?
Benjamin: If it would be a good investment or not?
Pat: No, of course...Look, look, it's not an investment. You're consuming it. A vacation home is you're consuming it.
Scott: When you die, what happens to the principle in this trust, this $30 million to $40 million?
Benjamin: I'm not leaving it to anybody. I mean, the property I own now [crosstalk 00:12:01.830].
Scott: What do you care about what the...why don't you buy the lake property then?
Pat: Yes.
Benjamin: Well, that was my plan.
Scott: Now, go ahead.
Benjamin: I know with the property I own now, if I die, it just goes on the market, I assume.
Pat: I know. But where's the money from the proceeds of the sale go?
Scott: You got this massive inheritance from somebody. When you die, where are the dollars going?
Benjamin: I honestly don't know.
Pat: Okay. Well, that's one thing I would look at. Either name a charity or a person or whatever. Otherwise, it's...
Benjamin: You mean like a will, basically. Yeah, that's...I mean, I can do that. I'm not planning to die anytime soon.
Pat: Okay, well, no one does. So anyway, all right...
Scott: If you want the vacation house, buy the vacation house.
Pat: Yes, it's not going to matter. It's a terrible investment, by the way.
Scott: Yeah, appreciate the call, Benjamin. What do you say, terrible investment. What do you mean?
Pat: Because it's not an investment. You're consuming it. It's like saying, "My wife and I are going out for dinner tomorrow night and we're going to a really fancy restaurant. Scott, is that a good investment?"
Scott: Yes. You're investing in your relationship.
Pat: Versus why can't we go to the taqueria down the street and have a quesadilla?
Scott: It's a trade-off. It's a trade-off. You're using your dollars saying, I'm taking these assets that I have and rather than having them invested for my future, I'm going to consume them on something I want today.
Pat: And rather than consuming less by going to the taqueria and getting a quesadilla, I have decided that we're going to go all in and I've got a coupon two for one down at the Steak 'N Brew. We're going down to the Steak 'N Brew.
Scott: Your whole point is we all make decisions with our assets, but we need to ask yourself, is this truly an investment for our future, financial future? What kind of...or is this something else?
Pat: Correct. And the vacation homes are not good investments, unless you're going to convert it to a rental.
Scott: From a financial standpoint...
Pat: From a financial standpoint.
Scott: ...you're better off taking those assets and investing in something else or just having it rented out full time.
Pat: That's right. That's right.
Scott: But if you're going to own a second residence so you can pop in and out when you want to, obviously, that's not...you're taking assets that could be generating income and no longer generating income.
Pat: And that's the same way with your primary residence. If you've got an 8,000-square-foot house or 5,000-square-foot house, you could purely surely live in...I grew up in a 1200-square-foot house with 6 of us. I mean, that was fine. It was okay. I mean, you learn to fight.
Scott: You don't want to go back, my guess.
Pat: We fought over the bathroom. It'd be all right.
Scott: It truly would be all right. Honestly, like, once you've got security of shelter, security of food...
Pat: The rest is kind of bonus.
Scott: It's...yeah. Anyway. We're talking now with Anthony. Hi, Anthony. You're with Allworth's "Money Matters."
Anthony: Hey, gentlemen, it's good to see you, or speak with you, I guess.
Scott: Thank you.
Pat: Thank you.
Scott: We appreciate that. What can we do to help?
Anthony: So my wife and I believe we have over-funded our son's college savings plans. I'll give you a bit of the background and I'll lead you to the question. So we adopted our son when he was 18 months old. And when he turned 2, we opened up his ESA account and within a year opened up a 529. He's now 18. He's been accepted to an out-of-state university and he'll be leaving in six months, going there this fall.
Scott: Congratulations. Can I ask a personal question on this? Because I adopted two kids. Did you adopt him from the U.S. or was he international adoption?
Anthony: No. International, yes.
Scott: Oh, well, good for you. And him.
Anthony: Yeah. Yeah. He won the lottery that day. He just doesn't know yet.
Scott: And you did. And you did.
Pat: And you may have as well.
Anthony: Well, time will tell.
Pat: All right. So what's your question for us?
Anthony: Okay, so he leaves for university this fall. And because of GPA, he qualifies for what essentially is in-state tuition, even though it's out of state. So his tuition is going to be about $16,000 a year in the state he's going to, round it to $20,000 for incidentals and whatever.
Scott: Plus room and board.
Anthony: Okay. Yeah. In his 529 plan...
Scott: No, no. So the tuition is 16 grand, but then you've got room and board, another $12,000 or something?
Anthony: No, no, no. That's $16,000...that's tuition, room and board.
Scott: Oh, wow.
Pat: Okay. It's cheap. Okay.
Anthony: Yeah. Okay. So in his 529 plan, we have $43,000. In his ESA, we have $250,000. If the market stays slightly positive, he's essentially going to earn, or we will, you know, enough to cover that cost for the next four years, assuming he makes it four years. So we are in a situation where we think we've over-funded. He's 18, going on about 15. He is not financially or fiscally mature enough to handle a quarter-million-dollar windfall when he graduates. We don't want to roll it into a retirement account for him. We want to spend the money.
Scott: Why?
Anthony: So it was our sacrifice, delayed gratification for 20 years to build up to this. So we know we can take out non-qualified distributions subject to ordinary income tax plus a 10% penalty. That's like our worst bad idea or best bad idea, I guess. So my question is, are there any other creative suggestions?
Scott: And you have no other kids?
Anthony: No other kids.
Pat: And do you need...
Anthony: This is the last one?
Pat: I understand you want to spend the money. Do you need to spend the money? Do you need this to fund any of your...Not want. Do you need this to spend any of your retirement or lifestyle today?
Anthony: No.
Pat: Okay. So...
Scott: Do you want to? I mean, do you want these dollars to increase your standard of living right now?
Anthony: Not necessarily.
Scott: Or is your motivation you just don't want the big chunk of money to go to your kid when he's too young and immature?
Anthony: It is definitely that for sure. But also we want to have some fun with it. I mean, our retirement plans are in good shape. We are retired now. My wife is essentially retired. We're still pretty young. So, you know, travel. I mean, we jokingly say by a big motor home, we don't really want one. But that's [crosstalk 00:18:47.297].
Scott: Rent one first.
Pat: Just to test the marriage.
Scott: A few times.
Pat: How much money do you have set aside in retirement plans?
Anthony: Total there is about $2 million and about a half a million equity and a paid-for home.
Pat: And are you taking income off of those retirement plans?
Anthony: Yes, not yet drawing Social Security.
Scott: How old are you?
Anthony: I'm 63. My wife is 58.
Pat: So have you looked at moving that ESA to the HSA?
Anthony: That's sort of an information gap for me. I don't know enough about it to give you an informed answer.
Scott: You can move an education savings account to a health savings account?
Anthony: Oh, I'm sorry.
Pat: No, no, no, no. Wait, wait. I'm thinking 529. I'm sorry. I misspoke. So have you looked at moving the ESA to a 529 plan?
Anthony: No, we have not.
Pat: Okay, so here's how I think about this. Here's how I think about this. The ESA, if you moved it to the 529 plan, you'd have to leave it there, I believe, for five years before you can start taking withdrawals. But there's no hurry to spend it. Once it's in the 529 plan, it's yours. Right? You own it. He's beneficiary of it. Okay.
Anthony: Well, okay. Clarify that for me. It's in custody for him. But I'm saying that upon his 21, it is his.
Pat: That's correct.
Scott: On the I'm not an expert on ESAs.
Pat: So I don't know if the ESAs...
Scott: They weren't utilized much at all.
Pat: They were only around for a few years. But the ESA to a 529 plan...
Scott: Did you fund this like a lump sum when he was a child?
Anthony: The 529, we did a lump sum and the ESA, we had a little bit of unused funds from two prior kids that we sort of jumpstarted it with. And then we had annual contributions for a few years. And then sitting down with a financial advisor, one year we looked at it and said, we probably don't need to fund anymore. And we all agreed and we just stopped. It's just grown from there. Sixteen years of growth can be an amazing...
Pat: Oh, I know that's right.
Scott: Yeah, for sure. And it's also one of the benefits as an investor is you live longer, you see the benefit of compound interest. Like, it's pretty incredible.
Pat: So you can you can move this over, the ESA to a 529. So you...
Scott: Can we change the beneficiary?
Pat: You cannot. You need to complete a transfer and asset form. I don't know the answer to that. So what I would look at is I'm not...
Scott: I've never talked to anyone with $250,000 in an ESA. You're the first person I've ever encountered with $250,000 in an ESA.
Pat: Yes. So here's the...I know I would move it from the ESA to 529. What I don't know is the 529 plan must have the same beneficiary is the Coverdell ESA. So the beneficiary...So what happens, I don't know if the restrictions on the ESA actually transfer into the 529 or they go away.
Scott: Yeah, it's going to take more research than this program.
Pat: Right. So if in fact that gets rid of that, then I would leave it in the 529 forever. I wouldn't be in a hurry to take it out of the 529 plan.
Anthony: Except so it becomes his at age 21.
Pat: So that's what I don't know. Under the ESA...
Scott: We don't know...
Pat: Under the ESA, it becomes his at 21.
Scott: I'm no expert on ESAs.
Pat: But the 529 plan, I don't know whether the ESA rules follow into the 529s. I suspect that they probably do. So your thinking is that you're going to take this money out and pay the taxes and penalties and spend it before it gets to 21.
Anthony: If we start maybe like in a year or two. And because we're retired and we don't have any income...
Pat: I like it.
Anthony: ...there's a certain amount we could take and just accept the 10% penalty, take enough that we're drawing it down, but not so much we create a huge tax burden all in one year.
Pat: I agree with you. I agree with you. I agree with you.
Scott: Yeah, I wouldn't touch the 529. Because you can change beneficiaries on the 529.
Pat: You could move it to grandchildren.
Scott: You can wait until you got a grandkid. Yeah. And you can move to several grandkids.
Pat: But so what I don't know the answer to, which is going to take more research, is does the ESA beneficiary has to be the same to 529 plan if you move to a 529 plan? I don't know if you're restricted from changing the beneficiary at some point in time. My guess is that you probably are, but that's going to take some research. My assumption would be that that that's going to be his and that the changes are going to take place. So I like your idea otherwise. So I'd ask either a tax accountant or your financial advisor, what are the ESA to the 529 plans? Do they stay in place? Does it have to cover that Coverdell all the way through the 529 plan? And if they come back and say, yes, it does, then the idea of just taking the money out and spending it and paying the 10% penalty, I'd do it all day. I mean, all day. You know, otherwise, you don't want your 21-year-old to get this money.
Scott: No, of course not.
Anthony: Yeah. And he does not know it exists and we just prefer to keep it that way. And then as he goes through life and matures and we see opportunities, you know, then we can decide when and how to [crosstalk 00:24:55.224].
Scott: I completely understand.
Pat: I knew a kid that he got his retirement or he got his college...He never went to college, but got the money. And he bought this beautiful red Karmann Ghia. This kid growing up. I mean, it was...Right? You look back at it now and I'm like, "Where did you get the Karmann Ghia?" It's like, "Oh, my parents saved all this money for my college and I got it." And this beautiful red Karmann Ghia, like, oh, everyone loved it. He didn't own that thing three weeks before he wrecked it. Right? And that's kind of what you want to...
Scott: Well, most young people are more interested in car catalogs than college catalogs. Right? I mean, that's reality.
Pat: And you want to avoid the Karmann Ghia story. Correct?
Anthony: Yes, exactly.
Pat: Yeah. So yeah, you're going to pay the 10% penalty. You're not going to like it, but...
Scott: I mean, in retrospect, the 529 certainly would have been a better option. But that's where we are, so.
Pat: It doesn't matter now, so.
Anthony: All right. I was hoping to...I mean, that's when I thought I would hear, so.
Scott: Yeah. I mean, before, I would do a little more research. Like we said, we're not experts in the...
Pat: I would see of the ESA follows through to the 529. And I suspect that it does just because it says the beneficiary.
Scott: I would think...I mean, I can't imagine it because the other areas....
Pat: Yeah, it falls through. So anyway, appreciate the call.
Scott: Yeah, wish you well.
Anthony: All right. Thank you very much.
Scott: Well, we're going to turn a bit right now. I have an interview with Victoria Bogner. Vicky's been on the program, what, two or three times over the last couple of years or whatever.
Pat: Yeah, at least.
Scott: She joined us...and we've talked about this program...Both Pat myself, we've been financial advisors for decades. We started an independent firm 30-some years ago called Hansom McClain for most of its existence. We rebranded that, I don't know, five, six years ago to Allworth.
Pat: To Allworth.
Scott: And then we've grown in part from, you know, clients get referred in by their existing clients, etc. Then we've also grown quite a bit by other firms partnering with us. And you're seeing this across the independent wealth management industry, mainly because these larger firms can offer a lot more services to clients than little mom-and-pop shops.
Pat: Yeah. So like, when we came up with this concept years ago and we started adding other firms, we went out, outside capital, and got some outside capital. But we've added tax services and estate planning services and...
Scott: Insurance analysis.
Pat: ...insurance analysis and more high net worth...
Scott: Medicare planning.
Pat: ...and Medicare. So all these things that are actually the clients need. But unless you get enough advisors and clients to spread them out...
Scott: But then we've also discovered the best advisors don't want to come work for somebody. They already have something good going on in their life. Right? So when they join, when they partner with us, it's a way that we've been able to track some of the best talent in the country, frankly, you get phenomenal people like Vicky Bogner.
Pat: Yeah. And then Vicky gets the fact that she doesn't have to...she gets a lot of autonomy, but doesn't have to run a small business on a day-to-day basis.
Scott: And spends time doing things that adds the most value to clients.
Pat: So that's our thesis anyway.
Scott: And it seems proven out with Vicky. Vicky, thanks for joining us today.
Victoria: Yeah. Thank you so much. And you're spot on, I was CEO of my prior firm. And I love working in the business, not so much on the business as far as doing all of the day-to-day stuff of running a small business. You're spot on. It's been one of the best decisions?
Scott: What educational designations do you have?
Victoria: I'm a certified financial planner, a chartered financial analyst, and an accredited investment fiduciary.
Pat: Okay, so a bunch more than I have.
Scott: Is that right?
Pat: A lot more initials behind your name.
Scott: I actually had one that I dropped. I didn't feel like paying the 100 bucks a year. Like, how many do I need?
Victoria: When it starts running off the edge of your business card, yeah, you pare it down.
Scott: Yeah. And so you are the head of wealth planning at Allworth.
Victoria: That's right. Yes. So I get to use my skill set to help all of our clients here at Allworth, especially our high-net-worth clients. And we're getting more and more folks who are realizing that this is the place to be if you have assets over $5 million.
Scott: So you're going to tell us about someone that you recently worked with and some strategy planning. So please share with us.
Victoria: Exactly. What's great about Allworth is, as you mentioned, we have estate planning, tax planning, insurance planning in-house, which means that when you're working with an advisor, you're actually working with a team of people and looking at your complete situation and working in tandem toward what is in your best interest. So this particular client...
Scott: Are you the head of wealth planning or are you on the marketing team? So where are you from? Someone [crosstalk 00:29:46.671] get a pitch.
Victoria: You know how much I believe in Allworth's value proposition. Yeah. So these clients, I'll call them John and Rebecca, but these are clients of mine that this is a very common situation. It was their second marriage, and they each had grown children from their prior marriages. Rebecca had one grown child and John had two. So the very common issue is, how do I make sure that my spouse is taken care of? But ultimately, I want my assets to pass to my kids, not necessarily my spouse's kids from the prior marriage, right?
Scott: Yeah. Well, and I tell you, Vicky, I know you've seen this because we've seen it. People sometimes they get unintentionally disinherited.
Pat: Yes.
Victoria: Yes.
Pat: Or thrown out of the house. Or thrown out of the house.
Victoria: Right. It's an issue.
Scott: You've seen that obviously [crosstalk 00:30:39.517].
Victoria: You can have a lot of handshake understandings, but really you want to get it down in your estate plan exactly what you want to have happen with those assets. And these folks, their estate was about $8 million, which right now isn't bumping up against that estate tax exemption, but if that gets slashed in half at the end of this year, then they will. So it's another consideration. So if you're listening right now and you're in a second marriage and you have kids from prior marriages, listen up. This is important for you to know. A common way for you to make sure that your assets ultimately go where you want them to is to use...And by the way, let me preface this by saying, I'm not offering legal advice here. You need to consult an estate attorney. We have a state specialist here on staff. But part of my job as a financial planner is to give you advice in accordance with your total plan.
So commonly, people in this situation will use separate revocable trusts. So they each set up a revocable trust. And then that would feed into what's called a bypass trust or a QTIP trust or a combination of both. And I know we're getting a little bit into a complex area, but I want you to hear this because this is why it's so important to have a financial planner involved in this, because each kind of trust has different tax implications. So for instance, a bypass trust, how that works is as the spouse with your assets, you get to say, okay, if I die first, then my spouse gets to use this amount of assets during their lifetime. But when they die, what's left in my bucket goes to my kids, my grandkids, whoever you want.
Scott: And Vicky, this applies not just to second marriages, right? Because it could be a first marriage where husband and wife, they have different ideas where they'd like to see their assets go when they pass.
Victoria: Absolutely, absolutely. So this is used in a lot of use cases. This is just the most common. But what happens with a bypass trust is that first, those assets are completely removed from the surviving spouse's estate, right? So when that first spouse dies, it goes into this trust. It is not a part of that surviving spouse's estate. So what that means is if those assets grow to be $30 million, when that second spouse dies, it's not a part of their estate. There's no estate tax on those assets. So that's huge. If you have a portfolio that's above the state estate tax exemption limit and it's going to grow in value over time rapidly, but also that means...
Pat: I'm sorry, Vicky, but it doesn't receive a step up in basis once it's been put in...
Victoria: I was just going to say that. But it doesn't get a step up in basis at that second spouse's death. So in general, it makes sense to put perhaps qualified assets in there, qualified high-growth assets, because those qualified assets in an IRA or something like that aren't going to get a step up in basis anyway.
Scott: Qualified meaning IRAs, 401(k)s.
Victoria: Correct. Yes. Or even Roth assets, right? So that's how to benefit from a bypass trust, but also a QTIP, and that stands for qualified terminable interest property, we call it QTIP for short, that doesn't remove assets from the second spouse's estate. It does defer the estate taxes, but it keeps it in that second spouse's estate because then it does come with a step up in cost basis at the second spouse's death. So it might make sense to put taxable accounts or real estate into that kind of trust.
Pat: And especially if...Would a QTIP work if you...second marriage, right, I bring the house into the marriage. One person brings the house in the marriage, allows the surviving spouse to live in that house until death, in which case it then passes on to the first spouse's descendants.
Victoria: Correct, or whoever they wanted to leave it to, or might even be a portfolio of investment properties or, you know, a plethora of different things. But what's most important is that when you're working with an estate attorney, it's not common, maybe they're superstars, but it's not common that they would know the tax implications behind all of these decisions. That's why you need your financial planner on that team. And with the right estate plan in place, the decision of what assets flow through to which kind of trust can be made at the time of the first spouse's death because, of course, the right answer depends on the laws at that time, your asset levels, the estate tax exemption amount at that time. So having a financial advisor with the knowledge of your entire financial plan, your goals, your legacy wishes, incredibly important to make sure that what you want to have happen actually happens.
Scott: And so with your clients, your real life clients that you changed to John and Stacy or whatever...
Victoria: John and Rebecca.
Scott: John and Rebecca, what did you end up doing? What was the plan with these two?
Victoria: With these two, we met with an estate attorney who also happens to be a good friend of mine, did my estate plan, but we set up revocable trusts for each of them. And then we also set up bypass and QTIP trusts for each of them so that when one of them passes away, at that time we can decide, okay, what makes the most sense for which assets to go where, depending on the estate tax exemption at that time, where taxes are, and what the income needs are. So it's all set up. It's all in place. They have a little bit more of a complicated situation because John, one of his kids is a spendthrift. So we have some provisions in there for that. And then if they have grandkids, we have provisions in there so that they're not subject to the generation skipping tax, which is a whole nother thing. So just even more reason to have a financial advisor who's knowledgeable in these things involved in these conversations.
Pat: So how many...So it sounds like you set up six trusts. Three each, three each, but did you only fund one of them?
Victoria: We only funded the revocable trust.
Pat: So you funded two, one for each.
Victoria: Correct. So you've got three trusts for each...
Scott: And by fund, it just means you put the assets in that [crosstalk 00:37:26.876] and changed the title.
Pat: So how do we know that at the first death that the decedent's wishes are followed?
Scott: John dies.
Pat: John dies. How do we know Rebecca is going to actually...is going to fund those?
Victoria: Because in the language of the revocable trust, which becomes irrevocable at a spouse's death, inside of that trust, number one, it names me as the financial planner over those assets, which means that I can be of help to Rebecca or John, whoever passes away first. But inside that trust, it has the language that these assets need to go into either the bypass, the QTIP, or a combination of both as per the recommendation of the estate attorney and the financial advisor, which is myself. So there's no way that Rebecca or John could go in there and say, "You know what? I'm just going to pull these out and use it for myself." It's very clear language in there.
Pat: Okay, so let's think about this, right? So John dies, Rebecca says, "Nah, I don't want to use that." Is it the beneficiaries that would actually bring action against Rebecca?
Victoria: If Rebecca actually did that, she would be going...I don't know how she would even do that, because she wouldn't have access to the trust.
Pat: She's defrauding the trust. Okay.
Victoria: Because [crosstalk 00:39:02.915] trust at that point. And then you have to distribute those assets according to the trust, right?
Pat: Got it. And you would just go...
Scott: So I remember a situation. This is probably 25 years ago. Second marriage. He dies relatively young, had a will. Most of his assets...I'm trying to remember exactly. They had the house. Most of his assets were in an IRA rollover. He had a will that he wanted his kids...yeah, I think it was his grandkids' education to be funded at X dollars, but never created any legal documents to structure this. So at his death, there was no irrevocable trust set up. And his ex-wife, I watched over the next decade. ..
Pat: Oh, spend down the money.
Scott: Yeah. Spend...
Victoria: Oh, no. And that's why it's so important to have separate revocable trusts.
Scott: So her half, she didn't touch, kept letting it grow and grow and grow. And his half, she kept spending down.
Pat: Because there weren't enough restrictions...
Pat: And she didn't like his kids.
Pat: And there weren't any restrictions on the irrevocable...
Scott: And I remember thinking, this is not really cool, but there's nothing...
Victoria: Yeah, that's why you have to have separate revocable trusts.
Scott: So Victoria, this was $8,000, $10,000, $15,000 for these clients to go through to this little [inaudible 00:40:32.209] at the estate planning attorney.
Victoria: Yeah, I mean, I live in the State of Kansas. It's not California, so it might be a little different depending on where you live. But yeah, it was not...it was extremely important to do. But it cost, you know, $8,000 to put this in place. However, I will say that this was before we joined Allworth. And now that we're with Allworth, we have a lot more tools at our...you know, for us to use as advisors that would have brought that bill down significantly for our clients that are over $5 million in assets that we're managing. So that is just some of the, you want to say, perks that we have for high-net-worth [crosstalk 00:41:21.238].
Scott: No more pitching. Thank you.
Pat: Well, it is true. It is true, but...All right, that's interesting, Victoria. Right? And how hard was it to get them involved in the conversation? With living trusted wills, what I have found with my clients was, "Well, we'll get to it. We'll get to it. We'll get to it." Until I've actually had them...
Scott: I actually today have a call with an estate planning attorney on my own estate on something I've been thinking the last few years. I need to address this. I need to address this. I need to address this. But I'm not dying today. Right? No one's dying today. So it's the type of thing it's so easy to put off.
Pat: How hard was it to involve them in this conversation, the clients?
Victoria: Oh, it probably took three years of nagging.
Pat: Isn't that funny?
Victoria: That's also part of my job, right? Yeah. You have to make sure your clients follow through with what's in their best interest. It's like, "Okay, guys, we have got to get this done." And it's part of thinking through, "Okay, Rebecca, imagine if you die and the way it's set up right now, everything just goes to John. And you're trusting him. And I know that you love him. He's a great guy. You're trusting him that he's just going to keep track of all your stuff and do right by you. But he has this spendthrift kid, who knows how much he's going to have to help him out. You know, he might blow through those assets over the next 10 years. He might get remarried. You just don't know. So can we just get this buttoned up so that you know exactly what's going to happen?"
Scott: I think it's important. It's important. I mean, even on first marriages, it can be important because, I mean, you've seen people do kind of crazy things when their spouse passes away.
Pat: Oh, yes.
Scott: Right?
Pat: Oh, yes. Suddenly they're remarried in nine months to somebody the family doesn't even think is a wise idea.
Scott: Oh, yes. Oh, yes. I mean, I actually...I'm going through the Rolodex in my brain right now about like, okay, that one? Yeah.
Pat: Yeah. Go on.
Scott: Like, he married that lady and I said to him, "Are you sure that you need to get married this soon?"
Pat: Big age gap, has her own kids, not employed. We've seen those things.
Scott: Yeah. Yeah. Anyway.
Victoria: Yeah. And so important to know that wills are not good enough, right? That beneficiaries on assets trump wills. So regardless of what you think your will can do for you, if you've marked somebody as a beneficiary on an IRA, that trumps the will.
Pat: Again, again, and supersedes. Supersedes.
Victoria: Supersedes. Yes.
Pat: We don't use the word trump.
Victoria: We don't use the word trump anymore. Different connotations.
Scott: Make this apolitical.
Victoria: Yeah, sorry. Supercedes.
Pat: All right. Thank you very much. As always, glad you are part of the team. And Scott and I will see you in the next couple of weeks. And we've got an educational program going on in Fort Worth, Texas, so.
Scott: I don't think I've ever been to Fort Worth. I've been to...Appreciate the call to join us, Vicky. I've been to Dallas a number of times. And if you don't live in Texas, Dallas, Fort Worth sounds like the same thing. But you talk to people from Texas, they say they're very different cities and don't confuse the two.
Pat: That's right.
Scott: And I don't think I've ever been to Fort Worth.
Pat: We were there and watched that...there was some sort of...they ran cattle down the street for something, something or other. I guess they do it once or twice a week or something. It's...
Scott: Not like the chasing of the bull in Spain.
Pat: Yeah, it was exactly that. That's exactly what it was.
Scott: Pat's running to escape the bull. I don't think that's what happens in Fort Worth.
Pat: No.
Scott: As we're wrapping up, wanna let let you all know, we've got a great workshop, Advanced Wealth Strategies for High-Net-Worth Investors. This is our first live, in-person workshop for 2025. I'm sorry, it's only in two markets right now. It's in the Sacramento area and the Cincinnati areas. But our experts are going to share advanced tactics for high-net-worth investors that they can use to preserve their wealth. Also, some advanced strategies we use with our own clients whose wealth maybe sometimes needs a little more sophisticated approach. And we're going to be talking about taxes designed to help create reliable streams of income, mitigate your tax burden, and get more of your portfolio. So the Sacramento and Cincinnati areas, March 26th and March 29th. Again, March 26th, March 29th. It's free, but you need to go to allworthfinancial.com/workshops. And seats in both these areas are filling up quickly. We do have some that they sell out. They're free, but they sell out. So if you want to reserve a space, I would do that. You can get all the information again at allworthfinancial.com/workshops.
It's been a pleasure having you all with us today as we've talked about financial matters. And so, appreciate you. By the way, if you like this program, go follow us. Make sure you follow us. Not just download when you want, but follow us. That would be helpful and give us a review. So anyway, it's been great having you with us. It's been Scott Hanson and Pat McClain of Allworth's "Money Matters."
Man: This program has been brought to you by Allworth Financial, a registered investment advisory firm. Any ideas presented during this program are not intended to provide specific financial advice. You should consult your own financial advisor, tax consultant, or estate planning attorney to conduct your own due diligence.