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Case Study: Betty
“Betty’s head was spinning when she came to see us the first time. She just wanted to know that she was going to be ok. My goal was to help her get through this very difficult time with as little worry and concern as possible. Nothing is more satisfying for me than helping a client gain peace of mind. When I visit with Betty now, I can tell that she is content with her life and feels well informed about her future,” said Mike Bolar, Partner and Senior Portfolio Manager.
A True Client Scenario: Betty (all names have been changed to protect the identities of our clients) was still reeling from the death of her husband when she visited us on the advice of her attorney. Her husband, to whom she had been married more than 40 years, had been an attorney for a bank trust department in another state prior to his death. Betty was 65-year-old when her husband died and had relied on her husband to make all of the financial decisions in the past. She wanted a real hands-on advisor who would help her establish and understand a sound financial strategy, implement it and keep her informed. Since she planned to live in Arizona, she asked her attorney to find a local wealth advisor with whom she could establish a long-term relationship.
Our Solution: Betty’s husband had done a very good job of setting up the estate but Betty and her attorney wanted to make sure that it was administered properly. The components of the estate included an IRA Rollover account and three trusts: his, hers and a Life Insurance Trust. In setting up the estate, Betty and her husband determined that they wanted to ensure that the surviving spouse would have income security sufficient to maintain the family home and the lifestyle they had come to enjoy, including enough money to travel to see their progeny without worry, while preserving the corpus of the estate for their children.
Our first task was to evaluate the trusts and IRA accounts to determine the best investment and income distribution strategies in light of income and estate taxes. We referred her to a local accountant who could assist with tax returns and we established a relationship with her son who is the trustee for the various trusts. We set up a schedule of meetings with Betty, her son, the attorney and CPA every six months to review the accounts, analyze tax consequences and rebalance. In addition, Betty’s portfolio manager, Mike Bolar, provides a monthly summary of each account to Betty and her advisors and calls them whenever we see the need for interim rebalancing. As Betty nears 70 ½-years-young, we will begin to analyze the impact of mandatory draws from the IRA account.
The Lesson: Sometimes clients just need a trustworthy advisor to ensure that a well-designed plan is implemented and maintained in accordance with their wishes. Betty didn’t want to worry about her future, but she did want to be informed. Our goal was to give her peace of mind, maintain the integrity of the plan and manage her assets and tax consequences accordingly. Three years later, Betty is traveling regularly to see her children and grandchildren and enjoying a lifestyle that would make her husband happy.