When Mike and Cindy Keane first became clients of Trust Company ten years ago, Mike was a senior executive for a large financial institution and Cindy was a homemaker. They have two adult children, Jeff (age 32) and Beth (age 30). Mike’s initial goal was to retire in five years and help his daughter in the purchase of a business, with himself as majority owner. The Keanes wanted a team of advisors who could assist with Mike’s transition from an employee of a large institution to an advisor/owner of a smaller company. Mike also wanted to leverage his business expertise by serving as a consultant and board member for other business entities.
When Mike transitioned to early retirement he’d accumulated $1.5 million in his 401(k), $3.5 million in various taxable assets, $1.5 million in deferred compensation, $600,000 of cash value in various life insurance policies, and $1.5 million in stock options and restricted stock.
Over the past decade Trust Company has helped the Keanes in the following ways:
- We assisted in the buy-side analysis and due diligence of several closely-held businesses which culminated in the Keane’s purchase of their internet marketing business.
- Trust Company assisted in the review of their life, property and casualty, and umbrella insurance coverage. This review resulted in the consolidation of policies and a reduction in premiums, while maintaining levels of coverage. We also helped secure long term care coverage for Mike and Cindy.
- We modeled different cash flow scenarios and jointly devised a plan that enables the Keanes to maintain their current lifestyle. We periodically review the performance of their investment accounts, Mike’s business income, and their spending projections to make sure their long term goals of legacy funding are attainable.
- We consolidated investment accounts previously managed by three different brokers, eliminating unintended investment redundancies and creating a portfolio commensurate with their risk capacity and long-term goals.
- We assisted in the review of their estate documents. Ultimately, Mike and Cindy decided to appoint Trust Company to serve as a corporate trustee. In this role, the Trust Company helps them manage their trust assets, authorizes discretionary distribution requests by the beneficiaries, impartially interprets the language of the trust, and answers questions asked by the beneficiaries.
- We assisted with an option and stock strategy that allowed Mike to reduce his investment risk in a tax efficient manner.
- After considering Mike and Cindy’s future tax rates and their cash flow needs we recommended a partial conversion of retirement funds to a ROTH IRA.
Over the past decade, the Keanes have valued their relationship with Trust Company for a number of reasons. Their children are comforted and confident that they have an advisor who can be a resource to them. Mike is confident that he has a plan to provide for his family in the event he is no longer able to do so, and Cindy is comforted by the fact that she has someone to trust and handle her family’s affairs if her husband is no longer present.