Getting Your House in Order

 It's financial spring -time to take advantage of all of the opportunities that are here and near to build wealth over the next business cycle.

So let's review the first rule of Investing 101. Rule Number One is Do Not Lose What You've Got. Whatever the Golden Goose is, protect that goose! And for most Americans, home equity is the biggest asset (the goose) in their finances.

So it makes sense to start getting your financial house in order by starting with the house itself.

How do you hold title to your home?        CONTACT ME

When I take my clients into escrow, the title company escrow officer always asks, "how do you want to take title to the property?" Next, they hand our client a list of twenty five choices without any advice about what to do. And you can understand why... the title company lawyers won't let the escrow officer run the risk of giving bad advice.

But we work with probate attorneys all the time  and they tell us that it's a big problem... nobody talks to buyers about how to take title when buying their home. Our favorite Nor Cal estate law specialist, Joel Harris gives these tips:

1. If you have an estate plan, consult your estate planning attorney. 
2. If you're a married couple buying a house and you have a living trust, take title as a Living Trust.
3. If you don't have a Living Trust, and you're married, you always want to take title as community property with right of survivorship. There is no better way unless you have a trust. For a single person, there is only one way to hold title.

Whatever you do, get some expert advice. Don't settle for whatever comes along. It may not work out well in the end.

Refinancing                       

Because of all the new rules about financing, banks don't want to have to look at customer's Living Trusts to make sure they have the power to refinance, so they ask customers to convey their property out of the Trust so they can refinance as individuals. Then many title companies simply neglect to advise clients to put their property back into the Living Trust after the refinance transaction.

As Probate Realtors, we talk to attorneys each year that are handling court cases trying to get property back into a Living Trust that people have refinanced out and never put back.

The Takeaway

Getting your financial house in order might not seem like the most glamorous way to start taking advantage of this financial spring, but remember the first rule of investing: Don't lose your capital. Carefully attend to issues of how you hold your real property.

It's Spring this Winter

Here is my recommendation for this year's New Years Resolution: make and start executing a strategic plan to achieve your financial goals over the next ten years.  And do it now.

Why Now? 

Because we're at the starting gate of the new business cycle. It's winter on the calendar, but it's financial spring right now, and it will be followed by financial summer, then autumn and winter. Guaranteed. Financial spring - now - is the time to start sowing economic seeds to nurture, grow and harvest in this next business season. Whether you want to start a new career or create a business, build wealth for financial independence or plan for retirement, you couldn't ask for a better time - financial spring- to get started designing the future you want. 

Is it really financial spring? 

Well, we look around us and this is what we see:

• long-term interest rates are at historic lows 
• real estate values have bottomed and regained value at a sustainable pace
• employment is rising and unemployment levels are falling to manageable averages
• GDP is rising to growth levels
• Inflation is low

What to do now

Make a Career or Business Plan: 

If you're planning on starting a new career or opening a business, the winds are at your back. Job opportunities are really starting to grow, and if you're starting a business, piles of capital are out there looking for a good investment. Get a detailed plan together and include the exact dollar amounts you expect your plan to create. Even if you're happy at your job (congrats!), write a plan down now detailing where you expect to be a year from now and what you need to do to hit your goal.

Financial Plan:

This is where you park all of the cash you create from your B plan. It's your personal budget and long-term investment plan. Wealth comes from growing cash after you create it. Contrary to popular belief, most rich people are not money-burning jet setters that inherited their money or won the lottery. Most wealthy people are the "millionaire next door", spending their days running small, but profitable, businesses and watching their money carefully. 

Estate Plan:

This is not just a subject for rich old people!  And even if the subject sounds mind-numbing, you have to do it. Estate planning is the part of your investing strategy that protects what you work so hard to build. The way you plan - or don't plan- your estate can affect your family fortunes not just in death, but you while you are still living. Do you own a trust? Is your home owned by the trust? If you need long-term care, will the trust provide the funds if you are incapacitated? If you don't have a trust, do you have a Will? As an SRES, I talk to people every week that are experiencing huge hassles because of poor estate planning. You shouldn't do estate planning yourself. You need expert legal advise from a competent attorney that specializes in elder law and estate planning.

That should get you started...

Don't the let opportunity of this business cycle pass you by. We each get only so many springs! Make your future happen by design. Write down your goals and plans to achieve those goals NOW

 It doesn't feel like spring outside today, but it is certainly early spring in this next business season. And the spring - now - is the time to start sowing seeds that we can nurture, grow and harvest in this next business season.