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Author: Howie52 Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 785  
Subject: Wondering Date: 7/11/2004 2:26 PM
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The board seems a tad slow and may not see much in the way of traffic. But if a lurker or two still passes by, I was wonderintg how many couples set-up specific investment accounts for the each of the individuals.

Currently, DW and I have three accounts outside of IRA's and my 401K. We have a joint account and each has an individual account. Since I have a 401K, DW's account has the majority of our investments - mostly DRIPs. We set this up a few years back as a form of estate planning prior to the republican temporary "roll-back/elimination" of estate taxes. The approach also gave a degree of security to DW.



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Author: BMNEELY Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 764 of 785
Subject: Re: Wondering Date: 7/12/2004 2:17 AM
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Howie,

I can tell you that our accounts outside of retirement accounts are all joint. For us your concern about estate planning really doesn't apply to us as our accounts are "Joint Tennants in Common with Rights of survivorship" Which means that if one of the spouses passes away all that happens is that their name is removed from the account. You aren't nailed with taxes etc. I can't say that this is the same for you but it is in many states.

Also having multiple accounts can also be costly to maintain.

Ben

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Author: 2gifts Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 765 of 785
Subject: Re: Wondering Date: 7/12/2004 9:18 AM
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Currently, DW and I have three accounts outside of IRA's and my 401K. We have a joint account and each has an individual account. Since I have a 401K, DW's account has the majority of our investments - mostly DRIPs. We set this up a few years back as a form of estate planning prior to the republican temporary "roll-back/elimination" of estate taxes. The approach also gave a degree of security to DW.


Other than our IRA's, we hold everything in a revocable trust where we are both trustees, so that is sort of the same as holding everything jointly. This does a couple of things. When we got married, we believed that we were joining our complete lives into one, and that included financials, so everything was held jointly. Then when estate taxes became an issue and we did our estate planning, we moved all our joint assets into a revocable trust so that we can each take advantage of our individual estate tax exemption, and we don't lose one tax exemption by having one spouse inherit everything from the other.

As a practical matter, though, I manage all the accounts and that includes DH's IRA and 401k accounts. All it takes to do that is a form that gives me trading authorization, and that allows me to legally trade in his account, but what tends to be more important for us, it also allows me to call and fix problems within his account because I am authorized to do so.


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Author: XWordPhile Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 766 of 785
Subject: Re: Wondering Date: 7/12/2004 3:41 PM
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DH and I do our own individual investing, so we each have our own accounts (I have him listed as beneficiary on all my accounts). Not for estate planning purposes, not for any explainable reason, really. I know some people are horrified by this, but it works for us, and that's all that matters, IMO.

Ellen

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Author: clairence Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 767 of 785
Subject: Re: Wondering Date: 7/13/2004 12:35 AM
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At this stage, DW and I each have our own separate savings, and there is only one brokerage account- "mine". Our investment real estate is in both of our names.

All this has just kind of "happened" as life has happened, with no particular consideration of taxes or planning. For example, when we finally had some spare change to invest, we opened "my" account so I could play around and learn how stuff works. She has no interest in such things.

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Author: BMNEELY Three stars, 500 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 768 of 785
Subject: Re: Wondering Date: 7/13/2004 2:34 AM
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Clairence,

Sure it works, the problem with the accounts not being Joint is more of an estate planning issue. I don't have any objection other than what if you kick off? She can't acess that account until it goes through probate, if it were a joint account she could.

So while my wife and I have all joint accounts her name is first on some mine on others. I still control most of the investing decisions because she has not interest in the research.

Ben

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Author: clairence Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 769 of 785
Subject: Re: Wondering Date: 7/14/2004 9:07 PM
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Ben,

Thanks for the tip. I'll look into turning the brokerage account a joint account.

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Author: clairence Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 770 of 785
Subject: Re: Wondering Date: 7/14/2004 9:09 PM
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2gifts,

a revocable trust sounds interesting. what all is involved in creating such a thing?



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Author: 2gifts Big gold star, 5000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 771 of 785
Subject: Re: Wondering Date: 7/15/2004 9:31 AM
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a revocable trust sounds interesting. what all is involved in creating such a thing?


It's not that complicated, but you need an estate planning attorney to get it all set up. In our case, we have a revocable living trust that we keep everything in. In a simple sense, it means that we each own half of our assets, and when one of us dies, that half goes into the trust thereby preserving the lifetime exemption which I think is around a million dollars right now. Then, when the 2nd spouse dies, their half of the assets go into the trust using their lifetime exemption before estate taxes kicks in. By doing it this way, either spouse actually gets to have the benefit of all the assets, but they also each get to use their lifetime exemption to reduce taxes. This doesn't matter between spouses since a spouse can inherit any amount without having to pay estate taxes, but it makes a big difference to the kids.

The other thing that really drove us to the trust is that a trust is private and no one gets to know the terms. This is unlike probate which is public and would allow anybody to contest it. I'm sure that a trust could be challenged, but it is not easy and probably not likely to be successful. In our case, we fully expect DH's sister, the ambulance-chasing attorney, to contest our wills to get custody of our children and access to their money, which will be a large pile when we both die. The trust eliminates that as a risk.

I know I've probably butchered the explanation, and someone who is more knowledgable can probably do a better job, but this is the general gist.

But it needs to be part of the entire estate plan, so you need to find an estate planning attorney if it's time for you do such things. If you were in MA, I could recommend someone that we have been using for about 10 years now. In that time, we set up the trust, and we just did our first amendment. My expectation is that we will probably change the trust one more time before we do an irrevocable trust, but that won't happen til we are advanced in age. At this point, there are too many things that could change so we are not yet ready to do the irrevocable trust yet.

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Author: jmknorthcarolina Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 773 of 785
Subject: Re: Wondering Date: 10/20/2004 1:31 PM
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I was wondering how many couples set-up specific investment accounts for the each of the individuals.

Our accounts, other than employment-related accounts (IRA, 401k, employee stock purchase), are all joint (savings, checking, mortgage, investment).

jmk in NC

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Author: JonathanRoth Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 774 of 785
Subject: Re: Wondering Date: 10/20/2004 4:00 PM
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Look at your needs and desires and set up your accounts to meet those needs.

We married in our 40's and I have a son by a prior marriage. I have an interest in keeping my pre and post marrage assets clearly separate. So we have separate pre-marital IRA's, separate post-marital IRA's, separate pre-marital brokerage accounts, joint post-marital brokerage accounts, joint rental property purchased with identified separate and common funds all wrapped up in a living trust which protects both my son's and wife's competing needs.

Complex, yes, expensive, not really, required, for me, yes.




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