September 2, 2014

SECTOR PORTRAIT

Wealth Management

Amid global uncertainties and a slow, frustrating recovery, many are grappling with how to keep their money safe and make it grow at the same time. In this sector portrait, some of Florida’s leading financial advisers offer advice and perspective.

Carolyn McClanahan
Certified financial planner/physician/founder of Life Planning Partners, Jacksonville


[Photo:Trib La Prade]
Best money advice ever received: Find work you love. If you find work you love, you don't mind doing it. You will invest more of yourself in it and do well financially. I don't remember who told me that, but I remember saying, 'Yeah, I've got to do that.'

Best money advice she's ever given: It's so important to understand your risk and to diversify. I had a client who was widowed and her husband worked for General Electric. He had invested his IRA in GE stock. I told her she has got to sell it and diversify. If she held on to it, it would have gone down to $200,000. She now has $1.2 million.

Advice to clients now: You need to approach the thought of retirement differently. It needs to be a reinvention. People who are happier and healthier are people who stay engaged. You never know what truly will happen in the market. Even if you work one or two days and keep your skills up-to-date, it will give you peace of mind. If your financial world falls apart, you will be OK.

How she'd invest $50,000: I'd put it in my diversified portfolio of passive investments. I'm in 50% equities, half are international, and 50% fixed income.

22% Percentage of U.S. households that use a financial planner for investing

Transferring Wealth: Edward Koren

Edward Koren heads Holland & Knight's private wealth services group, which has 80 attorneys around the country. Based in Tampa, Koren says he's not only a business adviser but also a sounding board for his clients whose family matters can get personal and emotional. He shares some strategies for wealth planning and protection.

Where you should start if you have a family business: Determine your objective. Is it to sell the business, or is it to pass it on to the next generation? A business that provides a good living for the founder may not sustain the next generation, and by the third generation you have to have huge growth if you keep slicing the pie. If you don't want to sell, then figure out the best way to get the business to the next generation while paying the least possible estate tax.

What you should ask yourself as a business owner: Who is best suited to take over the business? Be realistic about the abilities of your family members. Sometimes the best succession plan is a sale to an outsider.

Reason for estate planning with a family business: To avoid burdening the business with debt to pay off estate taxes. If you have a family business, you want to make sure you keep interests within the family unit. We create trusts to help achieve that.

The core techniques for passing along wealth: First, you have the basic outright transfer. An increasing number of people are not doing that because it's subject to becoming marital property and the property of creditors. For asset protection and business preservation, most people move wealth into a trust. Second, to achieve tax benefits you could move it into specialized trusts, which are as flexible as the imagination of the lawyer drafting them.

Tax law and succession planning: Right now there is certainty for two years, 2011 and 2012. The federal gift tax exclusion amount is now $5 million. It had been only $1 million. I am telling my clients they should take advantage of it. They may need to recapitalize so a smaller portion of ownership has a bigger vote by creating voting and non-voting interests. Then they can transfer value without transferring control. If it's a big business, between husband and wife, they can make a gift of $5 million each or $10 million together. They could put that into a trust this year and next year. You can leverage off that big amount and make a sale to another kind of specialized trust. You don't have to pay capital gains and you can transfer the value. You will see a lot of that going on in next two years.

The biggest mistake business owners make in estate planning: Some entrepreneurs are so busy growing businesses, they don't take the time to teach values at home. They don't realize you can't rely on a trust to teach values to your children.

TopRank Florida
Trust Banking Firms
Trust assets in Florida / Florida trust accounts / Senior executive

Northern Trust, NA / Miami
$35.1 B / 20,230 / Sheldon T. Anderson

SunTrust Banks / Orlando
$30.6 B / 11,039 / Debora M. Carswell

U.S. Trust, Bank of America Private Wealth Management / Sarasota
$12 B / 10,000 / Jeffrey A. Kaiser

Salem Trust Co. / Tampa
$6.4 B / 977 / Bradley K. Rinsem

Wells Fargo Wealth Management / Miami
$7.5 B / 6,000 / William D'Antignac

Visit TopRank Florida to purchase a list of Florida's 25 Largest Trust Banking Firms, featuring data not published in Florida Trend, including top key executive contacts, total trust assets in Florida, and phone, fax, website, and full mailing address.

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