What is Reverse Estate Planning?

Agemy Financial Strategies

April 18, 2022

Most Americans follow the “classic” method of estate planning, that goes from older generations to their younger ones. However, that perspective doesn’t take into consideration some opportunities to increase family after-tax wealth.

Effective estate management enables you to manage your affairs during your lifetime and control the distribution of your wealth after death. An effective estate strategy can spell out your healthcare wishes and ensure that they’re carried out – even if you are unable to communicate. It can even designate someone to manage your financial affairs should you be unable to do so.

It usually involves creating a living trust for the purpose of avoiding conservatorship in the event of incapacity and avoiding probate upon death. There is no question that being able to avoid the cost, expense, frustration, and other hassles with conservatorship and probate is worth the legal fee in creating such an important document.

Sadly, many Americans have not seen additional benefits of creating a living trust beyond avoiding conservatorship and probate. However, there is much more than meets the eye. The idea behind Reverse Estate Planning is that adult children can use an array of standard tax and estate planning strategies to transfer assets to their parents in a tax-advantage way.

Here’s what you need to know about Reverse Estate planning, and if it might be for you.

Reverse Estate Planning 101

When most individuals consider Estate Planning, they look “downstream” to future generations. They think about how to structure the Estate Plan so as to provide for children, grandchildren, and other younger beneficiaries.

The perspective has always been, “How can we benefit future generations?” And while this is a key aspect of any Estate Plan, there is not enough focus on the reverse, also known as “Upstream Estate Planning”. You should also focus upon how gifts and inheritances you expect to receive should be structured in order to benefit you.

The idea is the adult children can use an array of standard tax and estate planning strategies to transfer assets to their parents in tax-advantaged ways. The parents then use their lifetime exemptions to pass that wealth to their younger generations through either their estates or lifetime gifts. They might even benefit their adult children at little or no tax cost by passing the money to irrevocable trusts the adult children can’t control.

It’s also a good way for family members to make loans. For example, the adult children can take out low-interest loans for their parents. The parents use the loan incomes to buy assets that are expected to grow. At some point, they repay the loans and let the appreciation pass through their estates tax-free to the younger generations, either directly or through trusts. Or the parents can make lifetime gifts to the grandchildren or the trusts, using part of their lifetime exemptions.

Is Reverse Estate Planning for You?

As mentioned, traditional Estate Planning usually involves creating a Living Trust for the purpose of avoiding conservatorship in the event of incapacity and avoiding probate upon death. There is no question that for the vast majority of Americans, being able to avoid the cost, expense, frustration, and other hassles with conservatorship and probate is worth the legal fee in creating a Living Trust.

Nowadays however, most of the widely-used strategies for transferring wealth to younger generations also can be used to transfer wealth to the older generation.

Some adult children who have more assets than parents and can help take care of the older generation. In these cases, Reverse Estate Planning can play a valuable role. Some families would also benefit by using Reverse Estate Planning to pass assets now to the older generation so their excess exemptions can be used to transfer assets tax free for the benefit of their grandchildren or later generations.

Be aware, the lifetime estate and gift tax exemptions might not remain at their current levels much longer. The 2017 tax law is scheduled to expire after 2025, which would cut the exemptions in half. So, if Reverse planning seems like a good idea for your loved ones, now is the time to take advantage of it.

Final Thoughts

The key is to be aware of the concept of “Reverse” or “Upstream” Estate Planning and if it’s for you, you should ask your benefactors if they’d be willing to sign a Heritage Trust and make a modification to their Estate Plan.

There’s no better time to plan for the future than right now.  At Agemy Financial Strategies, our first priority is helping you take care of yourself and your family. We want to learn more about your personal situation, identify your dreams and goals, and provide you with the highest level of service.

Whether you think Reverse Estate Planning is for you or you’d like to explore a more traditional Estate Planning route, reach out to our Fiduciary advisors here to instantly book the day and time you’d like to connect with us for your complimentary 30 minute consultation. Our financial advisors in Guildford, CT and Denver, CO are looking forward to speaking with you.

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Holistic Financial Tips for Earth Day

Agemy Financial Strategies

April 14, 2022

First held on April 22nd 1970, we appreciate the awareness that Earth Day has brought to protecting our environment and the urgency that it’s instilled in all of us. As we strive to better our world this Earth Day, there are some takeaways that we can apply to our personal finances.

Earth Day comes around only once a year but reducing, reusing, and recycling can become an everyday habit. Not just for the environment, but financially as well. This year you can take action to save money in a sustainable way.

April 22 is Earth Day, a yearly celebration of the beauty that Mother Earth gifts her residents every year. With the holiday often comes a reminder that we need to be doing more to preserve our land, water and precious resources. In fact, Americans create 4.5 pounds of waste every single day—1,643 pounds a year—and three times more than the global citizen’s average.

Here are a few things you can start working on to reduce your carbon footprint financially.

Go Paperless – Sign up for eStatements

Tired of having your mailbox full of unwanted statements that end up in the trash? There’s an easy fix for this! Most financial institutions are taking steps to reduce their environmental impact by having their customers enroll in eStatements. It’s a win-win for both ends.

You may be incurring a small monthly fee — which some banks charge for paper statements — that can be eliminated by going paperless. Some financial institutions may provide a monetary perk for those who enroll in eStatements. Switching to online statements is significantly easier because they are readily accessible through your online account. Making for a simpler and more cost-effective solution.

Minimize Your Spending to Help Reduce Waste

Cutting back on unnecessary purchases will both help you put more money into savings and reduce waste from store packaging. According to the recent report by the Environmental Protection Agency (EPA), the containers and packaging category had the most plastic tonnage at over 14.5 million tons in 2018.

Here are a couple things you can do to minimize unnecessary spending and reduce waste:

  • Budgeting – This is the number one thing that helps to control spending and avoid unnecessary purchases.
  • Understand and recognize marketing traps that make us buy what we don’t need. Amazon is a big player in this, even when you search things you may need they include other items that might interest you on Facebook or Instagram. Understand how these traps work and avoid them by not buying into them.

Adjust Your Commute

Most people are used to working from home, especially after the coronavirus pandemic shut down offices and workspaces. If your work allows you to, see if you can continue working at home for part of the week. Some workplaces have adopted a hybrid work model where you come into the office two or three days out of the week and work from home the days you’re not in the office.

Better yet, see if you can limit your business travel by opting into more virtual meetings and conferences. That might free up even more cash, with the average American spending $1,186 on gasoline in 2019, according to the U.S. Energy Information Administration. (Let’s not begin to talk what that number is today with inflated gas prices!)

Look out for tax credits that can reward you for sustainable decisions

Saving money on energy costs and helping the environment are a big incentive you can take advantage of. You might be able to claim tax credits and other tax-advantaged opportunities at both the state and federal level by “green-ifying” your home.

Those tax credits range from the well-known to the obscure. If you own property, consider participating in one of the U.S. Department of Agriculture’s various environmental assistance programs, such as the Conservation Reserve Program (CRP) that pays a yearly rental payment in exchange for farmers removing environmentally sensitive land from agricultural production. There might be more options exclusive to your area.

Work with a tax advisor and Fiduciary financial planner to help you track down all that could be out there for you.

How Agemy Financial Strategies Can Help

Who knew Earth Day could provide so much inspiration for improving upon your personal finances? If you’re looking for ways to save holistically for Earth Day and beyond, look no further. Working with the advisors at Agemy Financial Strategies can help you get ready for the future and future generations. Because making just a couple adjustments to your financial lifestyle can be greatly beneficial in the long run.

Click here to instantly book the day and time you’d like to connect with us for your complimentary 30 minute consultation. Our financial advisors in Guildford, CT and Denver, CO are looking forward to speaking with you. 


Happy Earth Day to you and yours. Here’s to a happy, healthy and wealthy future ahead.

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TAX DAY: LAST MINUTE CHECKLIST FOR MONDAY’S DEADLINE

Agemy Financial Strategies

April 13, 2022

If you’re reading this, chances are you’re running a bit late with your tax return this year. No worries, and no need to panic! Agemy Financial Strategies’ Fiduciary advisors are here to help you sort everything out just in time to make Monday’s deadline. 

Tax Day is Monday, April 18th, 2022. If you’re unsure about which items you need for a last-minute tax appointment, you’ve stumbled across the right post, we’ll provide you with an up to date tax checklist that will make your appointment run smoothly.

Most taxpayers will be required to file their federal income tax return by April 18. However, there are some exceptions to this deadline and it’s certainly not the only date to mark on your financial calendar this year. Individuals who are self-employed, who file an extension or who are at an age when minimum distributions are required, for example, need to be aware of other important tax deadlines.

Here are the 2022 tax day tips you need to know.

Request a transcript from the IRS

Individuals can actually request a transcript from the IRS of your account history from all of 2021. It includes everything you need regarding wage and income information throughout the year. So if you misplaced any important documents such as a W-2 or a 1099 form, this is where you can rely on to find that information. For this all you need is your social security number, and you can view this information immediately online or have it mailed to you.

Re-visit your return from last year

Unless you’ve had a drastic life change over the last year such as marriage, divorce or children, most likely your tax return from the year prior will be an excellent place to start. Whether you’re employed through a company or if you’re self-employed, or even if you went through a bout of unemployment, having last year’s return handy may help to recall certain memories of deductions you typically make, any missing income, and/or expenses related to job searching and looking for new clients. This also will save you the hassle of recalculating the square footage of your home office cubicle.

Look for any stray documents and receipts 

Let’s be honest with ourselves here, if you’re just now starting your tax return, that probably means you aren’t the person who also has their paperwork filed away neatly or scanned into a document safekeeping app on your iPad. Time to drag out the box of receipts, and look through any miscellaneous income statements and payments that may need to be included in your tax return. This also includes downloading your bank and credit card statements and do a scan of emails for any non-profits you may have donated to over the past year.

Calculate in any random pay days

Did you win big in Vegas this year, receive a big bonus, or stocks took off in 2021? If you can recall it, the IRS already knows about it as well. How you file these types of incomes will completely vary depending on how you came up with the money. Contact us at Agemy Financial Strategies if you have questions on how this should be filed.

Verify. Verify. Verify again. 

If there’s anything that should be double and triple checked, that would be your tax return. As they say, the devil is in the details. Returns can be flagged for even the smallest of mistakes, perhaps a stray zero or a missing income figure.

An important note that is commonly missed: If you owe a penalty of some sort and you provide your routing number for direct withdrawal, or you list that the account is savings rather than a checking account, the IRS won’t be able to process your payment. That means even if your bank account is entered correctly, you’ll receive a penalty for a failure to pay.

Don’t forget to send it in!

Make sure to mail or e-file this year by Monday, April 18th, 2022. This seems pretty obvious and straightforward right? You would be surprised at how often people complete their taxes, only to set them aside and forget about them, and never get back to it. Maybe you’re thinking that you and your family don’t owe anything and weren’t expecting any refund. The potential consequence of this? Thousands in failure-to-file penalties. Make a reminder to yourself on your phone, in your calendar, and anywhere you need to make sure you have all of your ducks in a row by the due date.

More from Agemy Financial Strategies

Tax season is almost coming to a close. We just reviewed your tax checklist of the most common things to remember. When in doubt, it’s best to call your financial advisor to ensure nothing is forgotten.

Still a bit lost and need help with your 2021 taxes? Don’t panic, Agemy Financial Strategies is here to help you.Contact us today, and we’ll help you with a personalized plan to ensure you properly file and check all the confusing tax boxes. We’ll also evaluate your current tax strategy for 2022 to make sure you’re not paying more tax that you need to.

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