(This post form Don Paul at DV)
(Dinar Recaps does not give any financial advice and recommends everyone seek professional advice on their own locally from licensed professionals.)
When I worked way back when as an estate planner, it was interesting to see the products wealthier people had access to.
Even I couldnt come up with the minimums required for some of the very same products I was marketing at times.
This is not advice in particular, as everyones financial situation and desires vary wildly. Im just contributing some things I came across worthy of thought.
I saw some postings of an 'investment' via some attorney which could pay 3% or so per MONTH. I have a sneaky suspicion its one of those HYIP programs (hi yield investment program) which involves a private contract and not much else. Be careful, there is no need to go into such Maddoff type programs to make decent money. Ask for long term referrals and you'll see how they back-peddle saying is a "invitation only, secret investment" BS. BEWARE
Read More button on right
Since starting in 2011, mr obama has returned the famous 'death-taxes' you need to consider how to structure your estate as well as your investments for worse-case scenarios. Dont set your legacy to get later 'bullet-ridden" due to bad planning. Look into Q-tip, ABC and living trusts as well. IF set up properly, you can DOUBLE the amount of estate tax exemption from the start. Both husband and wife can have their exemptions (I think its around 1 million each) be lumped together with the right trust..
I was also reading people putting down Whole Life insurance. Be careful, you dont know what its really all about. Life insurance, in an estate settement especially is particularly effective to pay these new estate taxes (as high as 55%) for inheritors since the proceeds are very fast and very liquid and particularly TAX FREE. If you dont leave adequate amounts of cash for these unforseen expenses, your progeny may have to sell your assets in fire-sale prices to pay for these taxes. Also, term life keeps going up with age, and whole life was designed in one respect to deal with the increase of life insurance costs. Supposedly, the internal growth of the policy would then cover the cost of rising insurance to make it a more longer term life product for the individual. I also remember when A L Williams made it a business to get people to cash out of their whole life policies to promote 'buy term and invest the rest'.... guess what happened? the majority of people bought term and SPENT the rest. So after a few years, they had to drop their term life due to rising costs and ended up with nothing at the end. Term by itself is a good product DEPENDING what you intend to do with it. Usually, its a good product to cover your liabilities and income temporarily WHILE you build up your estate. (term life only pays 3% of all the ins. written) Then when your estate is worth millions, your need for certain types of life insurance diminishes since you have enough in your own estate.
Another product of interest, are annuities which have an annuitization option. Annuitization is an option you can excercise that lets you convert a lump sum amount into a guaranteed income. Even a combination of an IMMEDIATE annuity, which you can buy that guarantees an amount of income for LIFE... some with a clause that pays you REGARDLESS of how long you live, and this income is NOT accessible by lawsuits, garnishments, etc. Annuities can be a good base for a low-risk product, which offer tax-deffered growth (as opposed to bank CDs) and tend to have a better rate of return as well.
We used them a lot to structure the base for many estates, due to their great tax deferred growth, and annuitization features, as well as access to moneys without penalties in case of medical emergencies.
Warrent Buffett also invested heavily one time into life settlement products. It caught my interest, as it was another investment vehicle which offered consistent say 16% returns yearly with no risk of market, war, or oil effects. BUT I would only consider going with one of the companies who is PUBLICLY listed and has at least a 10 year record that you can look at so there is some accountability. A good option to DIVERSIFY your portofolio since so much is market-sensitive.
You might want to also look at Texas tax certificates which I believe pay 15%, one of the highest in the nation, and if you want a small percentage in hi risk- hi return there are some registered institutions which are getting as much as 40-60% returns in the high frequency trading arena but of course require higher minimum participation. No surprise.
What I recomend is that you set up an investment 'pyramid' with the bulk of you monies in low risk low return basics at the bottom, and move your way up the pyramid with investments based on your own tolerance for risk, age, financial responsibilities, etc.
If we are all so lucky as to make a large amount here, start thinking like a rich person (read the Kiyosaki books PLEASE) and do things like buy your car at auction, buy ROI real estate, PAY OFF YOUR CREDIT CARDS ASAP> that is the worst invention from mankind... compounded debt.. and most cycling every 25 days to 'gig' your monthly-payment-mentality.
Good luck to all, I do believe in positive thinking and thinking about how to structure your wealth is a good thing regardless... dont you think :-)