Companion Animal Planning

Dear Garden State Trust:

Can I provide something for my pets in my will? Didn’t Leona Helmsley set up a trust for her dog?

—Thoughtful Animal Lover

Dear Thoughtful:

Yes, Mrs. Helmsley created a $12 million trust to care for her pet, Trouble. However, the probate court subsequently reduced the size of the trust to $2 million, reasoning that a fund of that size should be plenty to keep Trouble in doggie treats and out of mischief. More recently, there has been press speculation that Karl Lagerfeld’s cat, Choupette, may become an heiress, as Lagerfeld died childless. (Details of his estate plans are not yet available.)

More and more states are changing their laws to permit pet owners to provide lifetime financial support for their companion animals. Alternatively, you may want to explore having more specific instructions identifying the caregiver for your pets, the standard of living to be provided, the schedule of vet visits, and the plan for financial distributions.

These are matters that you should explore with the attorney who handles your estate planning. Don’t feel embarrassed to bring up the subject of planning for your pets. As the Helmsley case shows, estate planning for pets is going mainstream.

Do you have a question concerning wealth management or trusts? Send your inquiry to

(March 2019)
© 2019 M.A. Co. All rights reserved.

Guinness Turns a Golden Argument Into a Gold Opportunity

The year is 1954. Sir Hugh Beaver still hadn’t found out what he need to know in order to be known as correct beyond dispute after missing a shot at a golden plover: What is the fastest game bird in Europe, the golden plover or the red grouse?

After searching for answers in reference books, the dispute between him and his hosts at an earlier event was left unresolved. He realized that he must not be the only one facing such a predicament, and leveraged his position as the managing director of the Guinness brewery to fix this problem once and for all.

They would create a promotion to settle bar disputes, distribute to local pubs, and he hired Ross and Norris McWhirter to create the official record. Over a thousand hours of work later, the original Guinness Book of Records was published, which became the global phenomenon we know today as the Guinness world records.

New Jersey has some Guinness records of their own to tout as well. Our favorite New Jersey record holder:

Erna Kohane, of Mount Arlington is the oldest person to grow a new tooth. She was confirmed to have a new tooth growing in January 2014, at the age of 92 years and 144 days.

Our favorite wealth management related record:

The mystery billionaire from Silicon Valley who owns the most expensive life insurance policy at $201 million – It’s hypothesized that it’s to increase liquidity and reduce tax liability for the beneficiaries. The full story is here:

Because of the temporarily enlarged estate tax exemption, tax planning is not as strong a motivator for most families’ estate planning. Nevertheless, it is crucial to create a plan and to get organized so those that need to figure everything out are not in the dark about what or where the assets are that will pass through the estate.

Garden State Trust Company professionals can help you get organized.

Did Sir Hugh Beaver win his argument?  Likely not, as the golden plover was not the fastest game bird in Europe. However, he did find literary gold though as over 138 million copies were sold!

Happy St. Patrick’s Day everyone!

Retirement Readiness

Dear Garden State Trust:

I’m old enough to retire, but I’m not sure I’m ready yet. I think I have strong financial resources, but I don’t know if they are enough to make me financially independent for the rest of my life. Retirement seems so terribly uncertain to me. When should I make the jump?

—Standing on the Cusp

Dear Standing:

First off, your situation is quite common, your hesitation quite understandable. Many people are working well into their retirement years, longer than they expected to when they began their careers. In some cases, financial necessity is the driver, but in other cases, a few more years of work may result in a retirement that is substantially more comfortable, making luxuries affordable.

Do you get personal satisfaction from your job? Are the daily job stresses outweighed by your sense of accomplishment? If not, do you expect that to change?

Keep in mind that for most retirees, tax obligations go down, sometimes dramatically. So the financial resources that you’ve accumulated may go farther than you realize.

Finally, how is your health? How long did your parents live? That information may help you to estimate your own longevity. What are the things that you hope to do with the rest of your life? How much time might that take?

Sorting through questions such as these may help you to determine the optimal date for beginning your retirement.

Do you have a question concerning wealth management or trusts? Send your inquiry to

(February 2019)
© 2019 M.A. Co. All rights reserved.

I Didn’t Know You Could Ship That!

Valentine’s day is right around the corner, and many of us are still struggling to come up with a new great idea to celebrate the event. There is nothing wrong with reusing a great idea, and doing so may even add to a sense of renewal or tradition.

Sometimes, a gift is all about trying to help someone reconnect with home. Depending on where home is, here are four ideas you may still be able to get in time for Valentines day, items that most people do not yet realize are shippable products:

1. Authentic NY Bagels. The unique texture and taste of a New York bagel is nostalgic for some people, especially if they grew up with it. Thus, several companies have started overnight shipping of bagels all over the United States so that they could be experienced anywhere. NewYorkerBagels has 15+ flavors and a monthly subscription that may be worth experimenting with if you don’t know what the favorite is already:

2. Authentic Midwestern Summer Sausage. If your loved one grew up in the Midwest, it’s likely they could get a taste of home if they had some Wisconsin summer sausage and cheese. This seems like a growth market with more companies expanding local operations to have a shipping component – here’s an award-winning company you may not of heard of (they have a fun back-story too):

3. Wine or Liquor. Wine and liquor can be shipped to New Jersey, so you could get rare bottles such as a vintage Chartreuse V.E.P not generally available at your local liquor store. You could consider a small batch bourbon that’s only brewed and sold in a different part of the country where your loved one or spouse is from. This site aggregates information from companies that will sell alcohol online, and makes it easy to find what you’re looking for:

If you’d like to get wine, but don’t know how to choose which to try – here’s a company that will match up your palate with a quiz and recommend wines for you:

4. Snow. In New Jersey, you might be wondering why you would ever buy snow for a loved one on Valentine’s day, since you’re likely sick of snow already. However, if you recently relocated to a southern climate and know your significant other is missing home, here’s a way to have it come to you:

Note – These are just ideas, Garden State Trust Company is not endorsing these companies or products, and is not being paid to advertise them.

Last year – we explored each of the five largest gift giving categories and what the ultra-wealthy might give too. From chocolate that comes from trees for which DNA has been traced back thousands of years, to roses that would continue to bloom for a year with no maintenance – we’d love to get feedback from anyone who tried one of those ideas. If you haven’t seen that list – it can be viewed here:

We hope everyone has a wonderful Valentine’s day!

Market Volatility

Dear Garden State Trust:

Yikes!  What happened to the stock market last fall?  Should I be getting out of the market now?

—Dizzy and worried

Dear Dizzy:

The economy remains sound.  The labor market is strong, unemployment is low, retail sales were generally up during the holiday season.  We may have had GDP growth of 3% or more in 2018—if so, it would be the first time in over a decade.  Few economists are predicting a recession in 2019, which suggests staying in the market.

Having said that, stock prices have become more volatile.  In December they were rocked by uncertainties over the effect of tariffs on global trade, the consequence of another interest rate bump from the Fed, and the ongoing polarization of national politics.  Price/earnings ratios of some companies have been quite high by historic standards.  Few market observers are predicting a reduction in market volatility.

If increased stock price volatility is keeping you up at night, then yes, perhaps you should consider a change in investment strategy.  Portfolios may be structured to reduce the risk of loss.  But the tradeoff is a lower upside opportunity.  It all depends upon your time horizon and your risk tolerance.

Before you make any move, a consultation with an investment professional, such as ourselves, about your holdings and your investment goals would be a good idea.

Do you have a question concerning wealth management or trusts? Send your inquiry to

(January 2019)
© 2019 M.A. Co. All rights reserved.

Designate a Destination with a Travel Trust

As the holidays wind down, many of us are already starting to look back with fondness at family traveling long distances to see and bond with one another.

We may not all look forward to getting on an airplane, or car, or train, but we generally look forward to what’s at the end of that day of travel: The destination.

Some of the time, everyone gathers around a member of the family such as a parent or grandparent, and it is difficult to justify the travel expense otherwise. Some of the time, the expense of travel limits some family members from participating, and so a parent or grandparent may help subsidize that cost.

Is there a way to make it easier to reach that destination using a trust?

Yes. A trust may be created with a travel provision to provide that the funds could only be utilized for travel by the beneficiaries. Here’s a fictionalized example:

Jeanette’s parents came to America when she was a child.  The family kept in close touch with their European relatives, and two of Jeannette’s children settled there. 

 To facilitate family reunions, one year Jeannette announced that she would provide $25,000 every year to help defray travel expenses.  Some years the get-together was in the U.S., some years in Europe, but each year the $25,000 would cover the transatlantic airfares plus incidental expenses for the extended family.  The reunions became so important to the family that Jeanette built them into her estate plan.

 At her death an irrevocable trust was created with the express purpose of funding family travels.

Though it was one part of the overall plan, this additional provision would ensure that this tradition continues for many years to come.

Why not just give them the money, and let them decide?

The largest reason to favor a trust over a direct gift is to direct the inheritance toward creating a specific experience or memories, and there are many ways travel can be a factor. Your impact would continue though the experiences directly tied to your wishes.

Such experiences could include creating the opportunity for children to connect with their heritage or religion, study abroad, or even promote doing philanthropic work in another country. Another great use of leaving inheritance for travel could be to provide for travel expenses if the family members are separated into different states or countries, designating a way to have family reunions, relieving the burden of paying for flights and tension that comes with it.

Perhaps your beneficiaries are workaholics, and you want to make sure they reduce their anxiety levels and take a break so you designate places you’ve been inspired by —such as the Grand Canyon— and a fund that encourages them to share in that experience.

Can the trust designate the use of funds toward other goals?

That depends entirely on the values of the trust creator, and what is set forth in the terms of the trust. Trusts are created so that the desires and values of the creator are repeated. Most trusts don’t have restrictions placed on them at all, but some suggest the funds can only be used for specific purposes to ensure they create positive change for the beneficiaries. This wouldn’t have to be travel — more conventional examples include categories such as education, or a home purchases.

There are a variety of imaginative and appealing ways that one might be able to provide for one’s heirs. We can provide some ideas to achieve different goals, and would be happy to discuss how a trust could help.

Mutual Fund Distributions

Dear Garden State Trust:

I bought shares in a mutual fund last summer and now I’m getting a distribution of capital gains from the fund. Why? I don’t want that. Do I have to pay taxes on it?

—Buyer and Holder

Dear Buyer:

Federal law requires mutual funds to distribute nearly all of their realized capital gains to their shareholders. Fund managers may try to offset gains with capital losses, but in this long bull market that may be easier said than done. When investors sell their shares in a fund the managers must sell assets to meet the redemption, and that may generate the realized gains.

This year it is expected that mutual funds will pay out roughly 10% of their net assets to their shareholders. This is not a function of how well the fund performed, it is a function of how many gains they realized during the year.  Assets held for a long period may show a gain even in a down market.

Yes, you will have to pay taxes on the capital gain. You may reinvest the distribution in the fund if you wish. The only exception to the need to pay taxes is if the fund is held in a tax-deferred retirement account. Then you won’t owe anything until withdrawals begin, and they will be taxed at ordinary income rates.

Do you have a question concerning wealth management or trusts? Send your inquiry to

(December 2018)
© 2018 M.A. Co. All rights reserved.

Holiday Spending

Holiday spending: It could be a new record!

 Why does the holiday spending season start after Thanksgiving, and why is it called Black Friday? Is it because:

A. There was a market crash in gold in 1869 that cause financial distress to many.

B. There was generally chaos in the streets of Philadelphia in the 1950s on Friday after Thanksgiving with an increase in shopping.

C. Retailers wanted a positive image for themselves and their customers, and their books going “in the black” was considered positive for them and the consumer.

D. Both B and C.

Answer – D.

Answer A is true, and was the first documented usage of the term “Black Friday”, but is unrelated to the current usage today.

There was a negative connotation associated with the term when if first started being utilized in Philadelphia in the 50s and the term caught on in 1961 and appeared in print. It wasn’t utilized nationwide until 1985, after retailers had rebranded the term as positive and being about going from their books being in the red, to turning a profit and being in the black.

A more detailed description of the history can be found here:

What about Cyber Monday?

Similarly, the current usage of the term came from promotion within the industry itself. It was coined by the National Retail Federations own Ellen Davis, SVP of research and strategic, in 2005 after seeing an uptick in online sales from multiple retailers on that date year after year.

A more detailed description of the history can be found here:

What about 2018?

Matthew Shay, the National Retail Federation President and CEO, said in October:

“Thanks to a healthy economy and strong consumer confidence, we believe that this holiday season will continue to reflect the growth we’ve seen over the past year.”

Their recent news report (Click here for more info) suggests that the spending on Thanksgiving weekend was consistent with their earlier forecast of an increase of 4.8 percent in holiday spending. Even though the average spent per consumer is down for the weekend, they think the overall spend will be higher for the holiday season.

According to Adobe Analytics the sales for Cyber Monday this year set a new record, going up from 6.59 Billion to 7.9 Billion, almost a 20% increase!

Shopping online is becoming more ubiquitous, which means less of a personal touch. Although the NRF is projecting that holiday employment will rise from last year’s 582,500 to as many as 650,000 workers, one still may feel the absence of salesmen to help with a purchase as retailers try to create a more efficient slimmer version of themselves that can compete with Amazon.

At Garden State Trust Company, we know that each client is unique, and needs guidance for their individual situation. We’re local, and continue to provide the same high level of service one expected from their trust officer in the past, and should continue to expect in the future. Not a 1-800 number, or generic product model – we’re here for our clients and are ready to serve.

Photo By Benson Kua, CC BY-SA 2.0,

Charitable IRA Gifts

Dear Garden State Trust:

I’ve heard of something called a “charitable IRA rollover.” What is that?

—Generous But Prudent

Dear Generous:

Those who are older than 70½ are permitted to arrange for a tax-free transfer of up to $100,000 per year from their IRA to the charity of their choice. This is the technique you are referring to, although strictly speaking it isn’t a “rollover.”

The other thing that those of that age must do is take required minimum distributions (RMDs) each year from their IRAs. These two things can go together. A direct transfer to a charity from an IRA counts toward the RMD for that year. Some retirees simply direct their IRA custodian to send the RMD to a charity, without worrying too much about the amount.

There’s no tax deduction when one does this, because there is also no inclusion of the distribution in taxable income, which would be the usual case with an RMD. Avoiding income inclusion is more valuable than getting a tax deduction. For example, it may avoid additional income taxes on Social Security benefits that otherwise could be triggered by an RMD.

This year many fewer taxpayers will be itemizing, thanks to the doubled standard deduction. For these taxpayers, arranging for a transfer to charity from an IRA will have better tax results than simply making a gift of cash in the same amount.

Do you have a question concerning wealth management or trusts? Send your inquiry to

(November 2018)
© 2018 M.A. Co. All rights reserved.

Sudden Wealth

Lotteries have grown in popularity in recent years, as jackpots have grown in size.

In October, the multistate Mega Millions jackpot grew to more than $1.5 billion if taken as annuity payments, and the largest jackpot on record won with a single ticket.

Lotteries are seen by some as the shortcut to financial security, even though the odds of winning are so low (1 in 302,575,350 for the recent Mega Millions jackpot). Ironically, some studies show that as many as 70% of lottery winners end up broke or filing for bankruptcy. In fact, 44% of winners have spent the entire jackpot within five years!

Some people earn very high compensation for a very short period of time, playing professional football is one example. According to a 2015 study, the median career earn­ings of an NFL player, expressed in inflation-adjusted dollars, were $3.2 million. That is far above the median lifetime career earnings of most Americans. Yet after 12 years of retirement, 15.7% of the players had filed for bankruptcy, a rate that is roughly three times greater than that of the rest of the male population of comparable age. The study did not try to pinpoint the causes.

Similarly, many notable actors and celebrities (For example, Johnny Depp) found themselves in a financial crises despite their large earnings.

Did they have a plan for their financial windfalls?

The phrase “sudden wealth” may be associated with lot­tery winners, but life provides many other opportunities for a sudden increase in net worth. Lump sum distribution of retirement benefits, insurance settlements, inheritance, or the sale of a business or investment real estate can create large sums of money for talented people who, like most lottery winners, do not have experience with wealth management.

Taxes are the first concern when sudden money is com­ing into one’s life. Taxes simply need to be assessed and addressed as part of the process. For lottery winners, for example, there isn’t much tax planning to do. The tax rules for retirement distributions are pretty straightforward as well. Planning a liquidity event, such as the sale of a business, can get more complicated. A legal consultation is likely advisable.

The harder talk is about the friends who may show up, looking for a loan or offering an “investment oppor­tunity.” Most difficult of all is broaching the idea that one’s family might not act honorably.

Garden State Trust Company has experience with wealth man­agement. We know all about financial transitions and attendant emotional adjustments. When you come into significant sums, call upon us for:

  • personal investment accounts, with asset allocation planning, unbiased investment advice and fees linked to account value (not transactions);
  • revocable living trusts, for an added measure of finan­cial flexibility, including protection in the case of disabil­ity and probate avoidance;
  • rollover IRAs to extend the tax-deferral benefits for your retirement money.

If you be will creating sudden wealth for someone else

If your estate plan includes a substantial legacy for a younger family member who lacks full financial maturity, consider using a trust for the bequest. Your trust will be a gift of more than financial resources. You will be includ­ing our investment and financial management expertise as well. A gift or bequest in trust can provide for a lifetime of financial security.

We look forward to being of service.