WEALTH TRANSFER DECISIONSHARVESTERS 5-28-2016

JERRY BLACK

ELDER, PERIMETER CHURCH

GENEROSITY MINISTRY TEAM

Why Wealth Transfer Is So Difficult•Helping heirs without

harming them• Sibling rivalry•Managing the

expectations of heirs• Sons, daughters • Sons-in-laws • Daughters-in-law • Grandchildren • Step-children • Step-grandchildren

• Providing for Spouse• Second Marriages• Providing for the Kingdom• Succession of a business• Desiring to finish strong• Legal and tax complexity• Uncertain Timing

Every Person’s 5 F’s

In The Garden……

Heaven

•It is the last stewardship decision that God permits me to make. •Executed by Someone Else•Live For The Arrow – Not The Dot

REALITY is……

•Wewilldie•Wewilltakenothingwithus•Wewillprobablydieatatimewedidnotanticipate• Someoneelsewillget“our”“stuff”•Wecanonlydecidebeforewediewhogets“our”“stuff”afterwedie

Wisdom or Wealth• “Wisdom, like an inheritance, is a good

thing and benefits those who see the sun. Wisdom is a shelter as money is a shelter, but the advantage of knowledge is this: that wisdom preserves the life of its possessor.” Eccl: 7:11-12

• Worldview vs Worldly view• Advisor makes a difference• Virtues or Values

Three Questions

•Who owns it?

•How much is enough?

• Is the next steward chosen and prepared?

Wealth Transfer vs. Estate Planning

• Impact on beneficiary is highest priority• Begins now• Stewardship driven•Honors God• Transfers ownership now

• Impact on donor and estate is highest priority

• Begins at death• Tax efficiency driven• May honor self• Retains control

•A Beneficiary should never be surprised by the decisions of the steward.

Wealth-Transfer Decision-

Making Process

Life Purpose

Decision 1 - Transfer

Decision 3 - Timing

Decision 5 -Tools &Techniques

Decision 6 - Talk

Current Deferred

Decision 4 - Title

Decision 2 -Treatment

Treatment Decision

•Principle - You love your children equally, and as such you should treat them uniquely • In God’s Image•Sometimes Fair is not Fair•Don’t be a Weenie•Giving Them Everything – Harm vs Good

Don’t Use Money To…

•Manipulate behavior (Modify with Love)• Focus on Principles

•Change Lifestyle•Destroy the Need To Provide•Come Between Husband & Wife•Come Between Parents & Children•Get in God’s Way of Dealing With Your Children

Other Issues

•My parents won’t talk•Are your children saying this about you?

•The care of Elderly Parents•Provision vs. Protection•Securities Industry Regulations vs Relationship

Practical Issues

•Title Decisions – Lots of Issues here•How you own something matters

•Beneficiary Designations (critical) (governs)•401k’s, 403B’s, Life Insurance policies, Annuities, IRA’s, Pensions

Testamentary Giving• Charitable giving could be an integral part of any mature

Christian’s wealth transfer plan. • Giving is commanded in scripture both for the benefit of

the recipient and for the benefit of the giver. • Christians should prayerfully determine the amount that

God desires of them. • Done proportionately and cheerfully to one’s net worth

having properly considered how much is enough for family.

Testamentary Giving

•Charity as beneficiary of an IRA•Giving of RMD’s while alive•Charity as beneficiary of a life insurance policy or

annuity you may already own•Most accounts can be set up POD or TOD•DAF for distributions (children/GC’s involved)• Appreciated property into CRT for lifetime income

Resources to Assist and Encourage

•PCA Foundation• pcafoundation.com

•Generous Giving• Journey of Generosity Event• https://generousgiving.org/media/all-videos

•Compass – Navigating Finances God’s Way•Kingdom Advisors (kingdomadvisors.com)•ReImagine Stewardship

Temporal vs Eternal?Well Done?