Are your Investments too Risky?

Are your Investments too Risky?

Question: I am glad the stock market has been doing so well, but with all the political problems in Washington, I worry that we might see another collapse. How do I know if my investments are too risky and how can I protect myself?

Answer: The amount of portfolio risk that is appropriate for you depends on your personal circumstances, including your age, income level, and investment experience. In addition, a number of tools are available that can help you better understand your tolerance for risk.

Who Manages your Wealth ?

Who Manages your Wealth ?

Question: I recently came into my inheritance and I suddenly I find myself with more money than I have ever had to deal with before. I am stressed and overwhelmed. Where do I even start with this? Help!

Answer: Some people imagine that inheriting a large amount of money would be a gateway to bliss—and then it happens to them. Suddenly they discover that having wealth can be very complex. Estate planning, tax planning and investments are each highly technical fields of expertise. You can’t master all of them yourself, so surround yourself with a team of professionals who can help you carry the load.

Should I Lend Money to My Brother?

Should I Lend Money to My Brother?

Question: I am not independently wealthy, but I have enough to be comfortable. My brother has always struggled with money. Recently, he asked me to lend him money to help buy a car. What should I tell him?

Answer:  In my experience, loans to family and friends tend to complicate relationships and often lead to misunderstandings. This may sound harsh, but if you lend money to a friend, you had better be prepared to lose a friend. And if you lend money to family, chances are you are setting yourself up for some unpleasant drama.

Trusts for Wealth Management

Trusts for Wealth Management

Question: I keep hearing about different kinds of trusts, especially revocable and irrevocable trusts. What are they and why are they important?

Answer: When properly designed and carefully used, trusts can be powerful wealth management tools. They can turn potential tax liabilities into charitable gifts and lifetime income streams. They can help protect assets from litigation and spurious legal claims. They can help establish and extend family wealth.

Special Treatment for Trusts at the FDIC

Special Treatment for Trusts at the FDIC

Question: I am confused by the rules for FDIC insurance.  I thought the limit for coverage was $250,000, but my friend says CDs owned by my trust can be insured for a lot more. Who is correct?

Answer: Thanks for your question. The good news is you are both right, but many people don’t realize that bank deposits made by revocable trusts get special treatment by the FDIC. Let me see if I can clear up some of the confusion.

The Federal Deposit Insurance Corporation (FDIC) is an independent federal agency that protects depositors in United States banks. If you deposit money in an insured bank and that bank fails, the FDIC guarantees you get your money back, up to a certain limit.