Home
>
Wealth Building
>
Building Blocks of a Financial Foundation

Building Blocks of a Financial Foundation

You can't build a house from the roof down, and you can't build a financial fortune from the roof down either. You have to build a foundation first.

The basic foundation of wealth consists of four legal tools. If you understand the tools and know how to use them, your chances of building a financial fortune are much better. If you don't have the basic foundation, it is time to get your act together. If your parents don't have their foundation in place, it's worth every effort you make and every dime you spend getting the foundation in place for them. Here's a basic overview of the four tools:

Testamentary Will

Everyone needs a will. Even if you have a revocable trust, you need a will. The will names the personal representative (the executor or executrix). A family member, who is geographically near the bulk of your estate, has good business sense, and can be fair with your heirs, is the person you are looking for. It is basically malpractice for the attorney to name himself or herself as the personal representative.

The will names the guardian for your minor children. If you have minor children or grandchildren, you had better see to it immediately that a guardian is named in the parent's will. The will should put restrictions on the guardians. Most wills simply state, "John and Mary guardians to my minor children." You can do better than that. Coach the judge in your will. It should read, "John and Mary; provided they raise the children in our family home where the children are living at the time of my death." "John and Mary; provided they are still happily married and harmoniously living together." "Grandma and grandpa; provided they have the health to take care of the kids." "Grandma and Grandpa; provided they don't sell the kids." You get the picture.

If you already have a will and don't have a living trust, you will have to get a new will which goes along with your living trust. It is called a "pour over will," because it "pours" all of your property, not already in the trust, into the trust for ultimate distribution after your death. The living trust is the next part of the foundation.

Revocable Living Trust

The living trust allows an estate to avoid probate, get twice the estate tax exclusion, and provide for a smooth transfer of property. It is definitely worth having for most families. Yes, there is a big argument in the legal profession between the standard will/probate guys and the living trust "hawkers." I come down in favor of the living trust, but I think it is your decision. Frank Sinatra was called the "Chairman of the Board," and he knew how to handle money. His living trust provided his estate with total privacy, much to the media's chagrin.

Many living trusts out there do not do what they are supposed to. The problem usually rests with the lawyer and user of the trust, not with the trust itself. The trust has to be maintained, and it has to "own" all of your estate. It isn't hard to manage, but the lawyer never takes the time to teach you how to do the management, and you can't afford to pay the lawyer to do it for you. As a result, a majority of people who get a living trust don't get the benefits they were promised. The living trust will "overlap" with a durable power of attorney.

Durable Power of Attorney

Durable powers of attorney allow an individual to control the property of a person who is unable to control their own property. People of all ages, not just old people, fall victim to accident or illness and are rendered unable to control their business life. A good living trust will have a provision that automatically lets a successor trustee manage trust property if you, acting as the original trustee, become incompetent. The durable power of attorney lets the person of your choice manage all of your other business affairs when you can't do it. Power doesn't transfer from you until the criteria outlined in the document are met, then there is an automatic transfer of power. This prevents messy court proceedings that are required to name a guardian/conservator for an incompetent individual.

The emotional and financial drain of a court proceeding when a family member has an accident of gets sick is the last thing the family needs at that time. The durable power of attorney prevents all of the legal problems at a time of crisis in the family, when a family member becomes incompetent.

Many powers of attorney include a section which addresses an individual's instructions and desires for their health care. This is a durable power of attorney for health care, which appoints an "agent" and grants them power to interface with the medical industry. The durable power of attorney for health care can be part of the document entitled durable power of attorney or it can be a separate document. It deals only with the medical treatment, not the right to die, which is addressed in a living will.

Living Will

A living will directs the doctors to keep you alive or pull the plug. You need one and so does the rest of your family. The best place to get one is in your hospital. Hospitals give them away free, and the hospitals like to see their own document rather than the 30 page beautiful, very expensive document you get from your lawyer.

These four legal documents form the basic foundation for all wealthy people. They are always there. They are what I call the "basic tools of wealth." Use them, and it will be worth every effort you make and every dime you spend.

Attorney Lee R. Phillips is a nationally recognized expert in the field of finance, asset protection, and asset protection. Lee is licensed to practice law before the United States Supreme Court and also holds licenses in insurance and securities. Lee is an engaging, dynamic speaker and has spoken to over a half million people throughout the United States, Canada and the Pacific Rim helping them understand the law and how to use it to their benefit.

His goal is to reposition you in the law so you can actually use the law to make more money, and keep it! His ability to present critical information in a clear manner has made him a highly sought after guest on hundreds of radio and television shows.

His specialty is in creating easy to understand, do-it-yourself legal systems. For more information, visit asset protection.

weekly home cleaning Highland Park ..

In The News:

FoloToy restored sales of its AI teddy bear Kumma after a weeklong suspension following safety group findings of risky and inappropriate responses to children.

Threat intelligence firm Synthient uncovers one of the largest password exposures ever, prompting immediate security recommendations.

Viral video shared by Elon Musk shows Tesla's Optimus humanoid robots performing tasks from cooking to construction, garnering over 58.5 million views on social media.

Chinese hackers used Anthropic's Claude AI to launch autonomous cyberattacks on 30 organizations worldwide, marking a major shift in cybersecurity threats.

Apple's new Sleep Score feature gives you a rating for your nightly rest quality. Learn how to set it up on your Apple Watch and iPhone today.

Essential phone settings to enable before losing your device, including Find My network, location services and security features for iPhone and Android.

The Fox News AI Newsletter gives readers the latest AI technology advancements, covering the challenges and opportunities AI presents.

Cybersecurity research shows weak passwords remain a major threat, with simple patterns and number sequences putting millions of accounts at risk.

New Android malware BankBot YNRK silences phones, steals banking data and drains crypto wallets automatically. Learn how this advanced threat works.

FDA approves first human trial for Paradromics' brain-computer interface that could restore speech for paralyzed patients through neural technology.

New phishing platform QRR targets Microsoft 365 users across 1,000 domains in 90 countries. Learn how to spot fake login pages and protect your accounts.

OpenTable now uses AI to track your dining habits and share insights with restaurants. Learn what data they collect and how to protect your privacy.

Google's discontinued Nest thermostats still secretly upload home data to company servers despite losing smart features, raising serious privacy concerns.

New Android malware NGate steals NFC payment codes in real-time, allowing criminals to withdraw cash from ATMs without your card. Learn protection tips.

DoorDash confirms data breach exposing customer names, emails, addresses after social engineering attack. Learn how to protect yourself from scams.

Concerned about Google's AI scanning your Gmail? Learn how to disable Gemini features that access your emails, Drive files and Chat messages for privacy.

Google warns Android users about dangerous fake VPN apps hiding malware that steals passwords, banking details and personal data from phones and tablets.

Apple's digital passport feature lets iPhone users breeze through TSA checkpoints this holiday season using Digital ID technology at 250+ airports.

A new phishing scam targets family photos with fake "Cloud Storage Full" alerts. Criminals steal credit card information through fake sites. Learn protection tips.

South Korean scientists create ultra-thin fabric muscles that turn clothes into robotic assistants, lifting 33 pounds while weighing under half an ounce.

Archer Aviation has acquired Hawthorne Airport for $126M to launch an LA air taxi network ahead of the 2028 Olympics, featuring AI-powered eVTOL operations and next-gen aviation tech.

Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.

Fake AI apps disguised as "ChatGPT" and "DALL·E" are flooding app stores with dangerous malware that steals data and monitors users without detection.

Fake buyers demand specific vehicle reports from unknown sites to steal credit card information from car sellers, but warning signs can help identify these scams before paying.

Android users can now manage apps across multiple devices more easily with Google Play Store's updated remote uninstall button in the latest update.

Building Blocks of a Financial Foundation

Wealth Building