Living the Abundant Life

Kirkland. Furthermore, future properties should each have a separate L.L.C. This will isolate legal responsibility in case of a lawsuit to one property. They should also get a personal liability umbrella insurance policy. The umbrella policy would dictate that their liability level coverage on homes and autos be reviewed and perhaps increased by their property and casualty insurance provider. The umbrella policy would provide a higher level of liability coverage for them and a shield if they were ever sued regarding their real estate ownership.

Prepare for the unexpected. In addition, Norris has no long-term disability coverage. Kirkland says he should get disability insurance that covers 60% to 80% of his income. Although they are in good health, neither of them has long-term care insurance, which provides for cost of care if either became chronically ill, disabled, or infirm. The couple may be able to get attractive rates now given their age and health.

Furthermore, Norris has a one-time death benefit of nearly $25,000 that has no beneficiary designation. “They should verify all their beneficiary designations on their insurance and retirement plans,” says Kirkland.

Get ready for the future. Neither Norris nor Reneau have wills, revocable trusts, or durable powers of attorney for healthcare. Kirkland says they should seek the help of an attorney who specializes in estate planning to draw up those documents.

Reneau is currently contributing 4% to her retirement plan, and the max is 8%. They should both consider increasing their contributions to the $20,500 level this year to help fund their retirement goals. Reneau’s asset allocation is 70% stocks and 30% cash. Reneau should revisit that allocation and do another risk tolerance questionnaire with their broker.

Financial Snapshot
Norris & Reneau Curl
Carson, CA

Household Income
Gross Income    $167,000

Savings    $30,000
Norris’ 403(b)    106,000
Reneau’s 401(k)    72,000
Reneau’s Pension    155,000
Rental House    530,000
Condo    400,000
2002 Ford F150 Truck*    9,360
2001 Corvette*    20,830
2001 BMW 540i*    13,600
1972 Sea Ray Boat    7,000
CD        2,200
Individual Stocks    835
Bonds    200
Total    $1,347,025

Mortgage on Rental House    $143,750
Mortgage on Condo    332,600
Home Equity Line of Credit    136,000
Auto Loans    29,435
Personal Loan    28,800
Total     $670,585
Net Worth    $676,440

*Estimated trade-in value according to Kelley Blue Book

This story originally appeared in the January 2009 issue of Black Enterprise magazine.

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  • ronald leonard

    Mrs. Sheryl Nance-Nash,
    I enjoyed your; “Living the Abundant Life” article. When time permits can you, or Ms. Kirkland answer the following question. Why would it be beneficial to place the Curl’s rental property in a limited liability company? After all wouldn’t an umbrella insurance property shield them from liability?
    Thanks in advance,
    Ronald Leonard

  • I must say, that I can not agree with you in 100%, but that’s just my IMHO, which could be very wrong.
    p.s. You have a very good template . Where have you got it from?