Carolyn Stewart

There’s a unique and increasingly popular way to manage your charitable giving that you may not have heard about. It’s called a Donor-Advised Fund. How does it work?

Mike Switzer interview Abacus advisor Anne Marie Ashworth.

Anne Marie E. Ashworth

Every year, it seems, there are new rules for retirement plans. And 2025 is no different.

Mike Switzer interviews Abacus investment advisor Stephen Scott.

Stephen “Scotty” J. Scott

Our next guest says she spends a lot of time working with families to achieve their lifetime financial goals, one of which is education funding for their children and grandchildren. She joins us now by phone to share some best practices for this goal.

Mike Switzer interviews Abacus advisor Laird Green.

Laird W. Green

All professional investors and money managers start their investment strategy and management programs with an investment policy statement. Charles says every investor should have one. And as you can probably guess, most don’t.

Mike Switzer interviews Abacus Chief Investment Officer Charles Flowers.

Charles B. Flowers

There’s an old saying that nothing in life is sure except death and taxes. But maybe the word “change” should be added because transitions are a natural part of life, such as changing jobs, having children, retiring, or losing a spouse. All of which can affect your finances. The death of a spouse, in particular, can present some tough challenges.

Mike Switzer interviews Abacus advisor Ann Beckwith.

Ann J. Beckwith

The objective of this article is to supply you with four thinking points to make informed decisions about whether to maintain, modify, or surrender your life insurance policy based on your evolving financial goals.

1. Check the stability of the insurance company who underwrote the policy to help ensure that your coverage remains in force.

Check the Company’s Financial Ratings:

Look for financial ratings from reputable rating agencies such as A.M. Best, Moody’s, Standard & Poor’s, and Fitch Ratings. These agencies assess the financial strength and stability of insurance companies. Higher ratings generally indicate a stronger and more stable company.

Visit State Insurance Department Websites:

Each U.S. state has an insurance department that regulates insurance companies operating within its jurisdiction. Check your state’s insurance department website for information on the company’s financial status, including any complaints or regulatory actions.

Research the Company’s History and Reputation:

Investigate the company’s history, including its years in business and any significant events or changes. Look for customer reviews and complaints online to gauge the company’s reputation for customer service and claims processing.

2. Request an in-force illustration.

An in-force illustration is a resource that provides a comprehensive snapshot of your existing life insurance policy’s current values, benefits, and performance. This information offers transparency into how your policy has performed over time, including the growth of the cash value (for permanent life insurance), premium payments, and death benefit.

In-force illustrations often include projections of future policy values, benefits, and premiums based on certain assumptions (e.g., future interest rates, policy expenses). These projections help policyholders anticipate how the policy may perform in the future. It shows the current premium payment schedule and whether there have been any changes or adjustments to premium amounts. In-force illustrations should be viewed as a tool that allows you to assess whether the policy aligns with your original goals and whether any adjustments or changes are needed.

3. Cost-benefit analysis of return on investment.

Analyzing the return on investment for life insurance policies can be complex because life insurance serves multiple purposes beyond traditional investment vehicles. The primary purpose of life insurance is to provide financial protection for your loved ones in case of your death, rather than generating investment gains. However, permanent policies do have a cash value component that can be considered an investment and should be when thinking about surrendering your policy.

Costs of life insurance policies: 1. Premiums – calculate the total amount you pay in premiums over the life of the policy 2. Policy fees and charges – be aware of administrative fees, rider charges, and other expenses associated with the policy 3. Opportunity cost – consider the opportunity of the money used for premiums, what could you have done with that money if it were invested elsewhere? Could you have made a better return?

Benefits of life insurance policies: 1. Death benefit – determine the potential payout your beneficiaries would receive if you were to pass away, is it worth the premiums you have paid in? 2. Tax advantages – some life insurance policies offer tax advantages,

4. Consult with your financial advisor for recommendations. Their expertise, objectivity, and ability to integrate insurance into your broader financial plan can help guide you to the decision that optimizes your overall financial well-being.

Karlyn M. Jones

Anyone who has watched the HBO series Succession has seen the challenges of passing along a family business to the next generation.

While most family businesses do not operate with the same level of drama as in the TV show, succession planning is one of the most significant challenges that family-owned businesses face. Having a plan for succession is crucial to ensure the smooth transition of leadership and ownership from one generation to the next.

Family business succession planning is a complex, necessary process to ensure the continued success and sustainability of a business across generations. By starting early, involving all relevant stakeholders, seeking professional guidance, and addressing challenges head-on, a family business can transition smoothly and preserve its legacy for future generations’ prosperity.

By following some careful steps and preparing for challenges, a business succession plan can go smoothly.

Key Steps in Succession Planning

• Initiate early. Start planning early to ensure a seamless transition. Ideally, succession planning should begin at least five (to ten) years before the intended transition.

• Identify successors.  Assess and identify potential successors within the family. Consider their skills, interests, and commitment to the business.

• Train and develop. Provide adequate training and development opportunities to groom the identified successors to include mentoring, leadership training, and exposure to different aspects of the business.

• Assess financial and legal aspects.  Evaluate the financial health and legal structure of the business to understand tax implications (and plan accordingly) to minimize any negative financial impacts during the transition.

• Communicate and involve. Keep open communication with family members about the succession plan to manage expectations and avoid conflicts. Involve all relevant stakeholders in discussions and decision-making processes.

• Seek professional guidance. Seek advice from financial advisors, legal experts, and business consultants with experience in family business succession. They can provide invaluable insights and help create a robust succession plan.

• Consider trial periods and obtain feedback. Consider implementing trial periods for potential successors to assess their capabilities in real business scenarios. Gather feedback from key stakeholders and make adjustments as needed.

Common Challenges and How to Overcome Them

• Conflict of interest.  Address potential conflicts of interest by setting clear expectations, roles, and responsibilities for each family member involved in the business.

• Fairness and equality. Ensure fairness in the selection process and be transparent about the criteria for choosing the successor. Consider appointing an external advisor to ensure objectivity.

• Emotional attachments. Separate emotions from business decisions. Focus on the best interests of the business and its stakeholders rather than personal feelings or family dynamics.

• Resistance to change. Implement change management strategies to help family members adjust to new roles and responsibilities. Emphasize the benefits and opportunities associated with the transition.

Effective succession planning is vital for the long-term sustainability and prosperity of a family business. Without a well-thought-out plan, businesses risk internal conflicts, decline in performance, and potential failure. A solid plan of succession helps to preserve the family legacy and the values the business was first built upon.

Brittany M. Midgette