Quarterly Perspectives - 4th Quarter 2024

As we enter the first quarter of 2025, our Quarterly Perspectives dive deeper into current topics. Read on to learn more about the expectation of the Federal funds rate, estate planning, charitable giving strategies, and tools to evaluate tax opportunities.

INVESTMENT PLANNING – Fed rate cuts offer an attractive opportunity for bond investors

• Our Outlook calls for continued Fed rate cuts in 2025 but at a slower pace than previously anticipated.
• High quality bonds remain an attractive investment opportunity as the Fed lowers interest rates.

ESTATE PLANNING – Things to do now to make your estate simpler for your heirs

Having a will or trust is not always enough. Use this list each year to do a little clean up now and your heirs will be thankful you did.

• Keep documents updated
  • Every five years: Review your estate planning documents such as wills, trusts, powers of attorney, and living wills. At the very least, we recommend reading your estate planning documents every 5 years to make sure the provisions are still applicable.
  • Every year: Double check the beneficiaries on your retirement accounts and insurance policies.
• Address digital assets
  • Every year: Make sure you have a plan in place for your heirs to access your digital assets, including emails, online photos, airline miles, online accounts, recipes, etc.
• Assign personal property in advance
  • Every 5 years: Don’t assume your heirs will “just figure out” how to divide your personal property. More than one family relationship has been permanently damaged over a family heirloom. Make a list and keep it with your estate documents. Or better yet, gift some items now so you can watch your heirs enjoy them
    
• Leave good notes
  • Every year: Give your heirs a place to start when it comes time to settle your estate. Set aside a folder of key information such as location of bank and investment accounts as well as the names and numbers of accountants, attorneys, and financial advisors.
    
• Strive for conflict avoidance
  • Every year: Document and review your reasoning for naming a particular child as executor/trustee or for dividing assets unevenly. Naming a third party executor could help avoid potential sibling-rivalry issues.

Source: Adapted from 5 Things to Do Now to Make Your Estate Simpler for Your Heirs, WSJ, November 14, 2024.

CHARITABLE PLANNING – Gifting strategies

TAXES – Tools to evaluate opportunities

• Gift assets now, particularly if your estate is above $6 million.
  • 2025 Lifetime Gift and Estate Tax Exemption per taxpayer of $13.99 million (will be decreased by half in 2026 under current law).
  • 2025 Annual Gift Tax exclusion per taxpayer of $19,000 per recipient tax-free without filing a Gift Tax return.
• Discuss completing a Roth conversion. Your Advisor can provide advice on the benefits of completing a Roth conversion now, as income tax rates may increase.

• Review your estate planning documents (wills, trusts, powers of attorney) to catch potential problems now.

The INTRUST Quarterly Perspectives are the consensus of the INTRUST Investment Strategy team and are based on third-party sources believed to be reliable. INTRUST has relied upon and assumed, without independent verification, the accuracy and completeness of this third-party information. INTRUST makes no warranties with regard to the information or results obtained by its use and disclaims any and all liability arising out of the use of, or reliance on, the information. The information presented has been prepared for informational purposes only. It should not be relied upon as a recommendation to buy or sell securities or to participate in any investment strategy. The Quarterly Perspectives are not intended to, and should not, form a primary basis for any investment decisions. This information should not be construed as investment, legal, tax or accounting advice. Past performance is no guarantee of future results.