Mountain Views News          Saturday, May 24, 2014

Mountain Views News Saturday, May 24, 2014 
B3BUSINESS NEWS & TRENDS Mountain Views News Saturday, May 24, 2014 
B3BUSINESS NEWS & TRENDS 
FAMILY MATTERS 

By Marc Garlett 

UNCONDITIONAL LOVE DOESN’T HAVE TO MEAN 
UNCONDITIONAL INHERITANCE 

Most parents love their children unconditionally 
and want to do whatever they can to smooth life’s 
rough patches for them. But that unconditional 
love doesn’t necessarily mean parents should 
unconditionally trust their children when it comes 
to leaving them a hefty inheritance. 

Here are some smart ways parents can pass their 
love along while still protecting the wealth they have 
spent their lifetimes working hard to accumulate: 

Annual exclusion gift test. A parent can gift up to 
$14,000 every year to each child without incurring 
gift taxes; both parents together can give a total 
of $28,000 to each child. You can use this annual 
exclusion gift to test the waters on how your 
children will handle a financial windfall. Do they 
pay off debt, save it or place it on the ponies? Their 
actions can give you insight into how they might 
handle their inheritance. 

Incentive trust. Parents that have worked hard to 
accumulate their wealth often worry that a large 
inheritance may harm a child’s ambition to succeed 
on their own. If that is a worry for you, an incentive 
trust allows you to set goals or milestones for your 
children to achieve before distributions are made. 

Staged distributions. Parents can create a trust with 
the distributions tied to different ages, stages, or life 
events (graduating college, starting a business) so 
the inheritance is doled out over time. 

Leave a legacy. Creating a personal foundation to 
support the causes you believe in, and involving 
your children early on in that foundation, will help 
them learn about the responsibilities that come 
with wealth and create empathy for a world outside 
their own. 

Hold the cash. Instead of giving cash directly 
to your children, consider alternative giving 

strategies, like paying down their college or home 
loan mortgage debt. This will make a big difference 
to their financial future without tempting them 
with large amounts of cash. 

Wealth creation trust. As I mentioned in a previous 
article, one of the best ways your unconditional 
love can be expressed to a child or grandchild is 
through the establishment of a wealth creation 
trust to commemorate a birth, milestone birthday, 
or event, and then directing monetary gifts to the 
trust over time. 

When your child gets to be an age specified in the 
Trust, he or she can step into the role of Co-Trustee 
of the Trust, learning how to operate the trust and 
best utilize the funds in the Trust. He or she will 
be trained on the best types of investment for the 
Trust, learn the purpose of the Trust (to encourage 
the creation of wealth from one generation to the 
next, rather than the squandering or wasting of 
assets); how to protect it (keep the investments in 
the name of the Trust, regardless of how funds are 
used, so always title investments properly and sign 
on behalf of the Trust); and how to create more 
wealth in the future using the Trust assets. 

One of the main goals of my law practice is to help 
families like yours plan for the safe, successful 
transfer of wealth to the next generation. Call my 
office today to schedule a time for us to sit down and 
talk so we can identify the best strategies for you to 
ensure a family legacy of love and financial security. 
Call 626.355.4000 or visit www.GarlettLaw.com for 
more information. 

Marc, a local attorney, father, and CASA volunteer 
(Court Appointed Special Advocate for Children) 
is on a mission to help parents protect what they 
love most. His office is located at 49 S. Baldwin 
Ave., Ste. G, Sierra Madre, CA 91024. 

PURCHASE SOME 
PROTECTION 
A listing that offers a home warranty presents a win-win for all parties. Sellers can use this attractive 
marketing tool to give buyers some added assurance and confidence in their purchase, by giving the 
buyers protection against failures in the home’s systems and appliances. 

Not all home warranties are the same, however, so sellers should be careful to educate themselves 
about the differences in cost, coverage, and policy owner feedback among the various companies 
that offer these contracts. These war-ranties may cost between $250 and $500 for one year, but that 
investment is well worth the return when a confident buyer makes an offer. 

Even if the seller does not offer such a policy, buyers are able to purchase one themselves, if they 
wish. Visit websites such as homewarrantyreviews.com to check reviews and ratings with the 
Better Business Bureau. 

Also pay attention to what fees, if any, are charged for the service calls, and what exclusions may 
apply. All warranties offer a “basic coverage” policy, and you can often upgrade to include additional 
systems and appliances that are not included in the core package. 

Chances are that the listing agent and buyer’s agent will have a list of recom-mended companies 
that offer these warranties, and will have worked with many buyers and sellers in the past who gave 
them feedback. Don’t be afraid to ask! 

WHAT SOCIAL MEDIA TOOLS ARE ESSENTIAL FOR 
YOUR BUSINESS?

 When it comes to choosing 
the right social media 
tools, start simple. Don’t 
be overwhelmed by all 
the choices. Use the tools 
that make sense for YOUR 


business and allow you to accomplish what you 
need to do. 
Let’s take a look at a real world example: 
Paul Kaufman is a healthcare recruiter. His 
business goal is simple: he needs to let health care 
professionals know about new job openings. He 
uses 3 tools: LinkedIn, Facebook and Constant 
Contact for group email campaigns. 
He uses LinkedIn to target and build his audience. 
He uses Constant Contact to stay in touch with 
his audience through email and drive traffic to his 
Facebook page. His Facebook page has a special app installed that lists current job openings and 
allows candidates to apply for a position. With Constant Contact, he can measure behavior; he can tell 
if people actually clicked the link to view his current job listing. You can view Paul’s Facebook page 
and his Job listings at: www.facebook.com/PaulKaufmanHealthcareRecruiter. 
Paul’s tools and strategies are simple. He uses the social media tools that will reach his audience 
directly and get the best results. 
Take a look at the tools you are using. Are they accomplishing what you need them to? Are you able 
to track behavior and measure results? Are you using the tools that your target audience uses? Start 
simple and stay focused on what you want your audience to do.

About MJ: MJ and her brother David own HUTdogs, a creative services business that specializes in Internet Marketing strategies 
and Social Media. They offer social media management services and help their clients build a strong on-line presence. “Like” them 
on Facebook for trending news in social media, internet marketing and other helpful tips, www.facebook.com/hutdogs. 

Sign up for their upcoming classes and presentations at: www.hutdogs.com/workshops/schedule 


SHOULD YOU 
You are allowed to withdraw and if you plan on keeping money in the account for 20 years, then 

only when you’re 59 ½ and have separated from employment. the Roth will make more sense. Giving up a tax deduction now CONTRIBUTE TO A Any withdrawal is treated as income in the year withdrawn, but in return for 20 years of tax free growth AND tax free withdrawals ROTH 401(K)? premature withdrawals are subject to a 10% penalty tax on top of almost always provides substantial benefits. 

the income taxes. 

The decision is less obvious between these two extremes. The longer 

By Greg Wellborn 
Roth 401(k)s reverse many of these benefits. There is no tax the money stays in the Roth and the larger it grows, the greater is the 
deduction for contributions. The growth in the account remains tax tax-free withdrawal benefit of the Roth. The shorter the investing 
free, and withdrawals are also tax free; this is the major difference timeframe, the greater is the tax deduction benefit of the regular 

Someone recently asked from a regular 401(k). 401(k). A little analysis is needed to make the right decision. It’s not 
me whether they should complicated, but it’s not necessarily easy. Any qualified financial 

So when should you contribute to a Roth as opposed to a regular 

contribute to their employer’s 401(k) Roth option, which is simply 
advisor should be able to do it. 

401(k)? It depends on what you expect your tax rate to be in 

the ability to open a Roth account inside an employer’s 401(k) 

retirement and how long you intend to keep the money in the About the author: Gregory J. Welborn is the Managing Partner of First plan. It was tempting to say yes because Roths offer a number of retirement account. If you anticipate your tax rate to be the same, Financial Consulting, a fee-only advisory firm. He has worked with The 
great benefits, but the correct answer has to be more nuanced and or less, in retirement as it is now and you’re only going to keep the Today Show, Kiplinger’s Magazine, and USA Today to provide objective 

depends on a couple of factors. 
financial advice to their readers and listeners. He has 3 grown children 

money in the account for 5 years, there’s not much advantage to 

and is honored to be married to his wife of 25 years. He can be reached at 

Regular 401(k)s offer a tax deduction for contributions made from the Roth. Contribute to the regular 401(k) and at least get a tax 

gwelborn@ffconsult.net 

your paycheck so they reduce your current income taxes. Any deduction for 5 years. 
growth in the account is tax free until you withdraw the money. 

On the other extreme, if your tax rate might be higher in retirement 

Mountain Views News 80 W Sierra Madre Blvd. No. 327 Sierra Madre, Ca. 91024 Office: 626.355.2737 Fax: 626.609.3285 Email: editor@mtnviewsnews.com Website: www.mtnviewsnews.com
Made possible with funding from the Centers for Disease Control and Prevention through the Los Angeles County Department 
of Public Health. 
Drifting Secondhand 
Smoke Affects 
Everyone! 
The poisonous chemicals in secondhand tobacco smoke 
affect any and everything it comes in contact with, 
including your children and pets. You and your loved 
ones deserve a clean air environment, with protection 
from unwanted secondhand tobacco smoke in your home 
and community. 
Join the Coalition for Clean Air Residential 
Environments (C.A.R.E.) of Sierra Madre. For a 
cleaner, safer, and healthier community. 
For more information, contact: 
caresierramadre@gmail.com 
(626) 229-9750