Arizona Living Trust Portfolios
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Mike On Money

August 27th, 2025. Well it’s time to add to my blog. Seems like the Covid ordeal put a damper on posting. This blog post is about disinheritance actions. I can say very honestly that this subject is one of the most controversial consulting areas in my legal documents practice. When I am hired to draft legal documents in estate planning that limit or completely disinherit a child or grandchild, my heart starts beating faster. I have had to do it a lot over my long career and it never sets well with me. However, the dictate to create terms of disinheritance for offspring does have value in the estate planning arena.

Perhaps, more and more children, grandchildren in the past few decades have gone against the wishes of their parents or grandparents and acted in ways, (including inactions as well) that did not please the estate client who after much deliberation, has come down to dictating this legal move to remind them, after the death, that there was a cost to pay for certain habits, actions, in-actions, harmfully spoken words in anger never recalled, abandonment of visiting, etc.

I hate to see the “hammer” come down this way after a client dies, but they are in charge at the time they draft and they have their reasons to restrict or eliminate certain beneficiaries, normally their own children, who they are unhappy about their lifestyle, habits, that have hurt the estate owner/s. So it is a way to remind after a death, the true cost of their actions. (or inactions) If this is something you are exploring, I have a lot of experience in drafting legal documents (Wills, Trusts) that will help carry out your wishes to disinherit someone. Smart attorneys can contest the provisions and try to prove a “senior” was not at full mental capacity when the disinheritance clauses were drafted. Or try to prove in a formal “contest” court filing they simply forgot them.

Just know, as much as I hate doing these, I have studied for years the best terms to draft so that the decision does not get amended by a Judge in a formal court contest filing. Since 2009, Arizona trust code law is pretty liberal in this area compared to other states (such as my home state of Iowa who will let a Judge disinherit you if you even get mad at a Executor or Trustee), as it takes a formal “contest” court procedure here in Arizona and an extremely clear and egregious situation in order to lose your share of an estate you were named a beneficiary (heir) of.

I close in saying the wording in Wills and Trusts will normally in most states contain language that you are to be treated as if you (and perhaps all of your offspring) are to be treated as if you pre-deceased the descendent. I tell clients that in honest frank language, (without practicing law of course), that this pretty well means you are “dead” to the parent who disinherited you and thus, not able to get any share. Leaving other siblings to redivide the money and assets amongst themselves right in front of your eyes. (legally dead, personally very much alive).

A free 15 minute conference by Zoom or in person can discuss the general legal information pertaining to drafting such a provision in your Will or Trust with me. Call me at 1-800-782-2806 or email me at mdanderson@webfsi.com

I hope and pray this blog post does not apply to you!

M.D. Anderson

Losing IRA

Many ads from professional advisers and companies on television, radio, and print advertisements defy logic when it comes to suggesting you take your IRA (401-k payout), SEP, Inherited IRA, or any other retirement plan and invest in gold, silver coins bullion. Or Crypto coins.

Yes, I invest in those alternative types of investments. But I adhere to the standard and proven investment pyramid that suggest these type of speculative investments belong at the tip of your investment portfolio and remain in the 5-10% range of your total, diversified investment portfolio.

Instead, they want you to transfer your entire IRA into their hands. And if any SMART CPA or other tax professional was to be asked just how smart that would be, hopefully, the answer would be:
”It’s a good way to have a losing IRA.” The safest investments belong in your retirement plan since any losses incurred can not be “harvested” and deducted on your annual tax return. (IRS gives you back some of your loss based on your capital gains tax rate). If tax rates go up (duh, they will), this means, even more, to buy smart and don’t turn a winning IRA account into a loser.

All variable investments go up and they go down over time. Some gravitate to higher highs over time such as well-picked stock portfolios with quality companies. Or most high-rated mutual funds. But to take your largest asset and transfer the whole enchilada into a physical gold account, or a physical silver account (many more metals can be bought and stored for you beyond these two most popular metals), you are setting up your account as a losing IRA.

What I am saying is that when you invest in risky alternative investments inside the IRA “wrapper”, you are forever restricting yourself from taking any tax loss on your personal annual income tax return. The tax basis for the most part is always “ZERO” in these types of accounts which are fully taxable someday to somebody. Either you when you retire or your heirs after you die.

The current financial conditions worldwide scare people into making this HUGE mistake. If you want to own gold or Bitcoin, shun those wanting to grab your large IRA or 401-k retirement payout. (or your inherited IRA). Buy the riskiest of all investments in small quantities only.

Your retirement money is either your largest asset or second largest asset along with your home equity. All retirement money belongs in either fixed investments such as indexed fixed annuity contracts (for older clients 55+ in age), or well-rated mutual funds and/or professionally managed stock portfolios.

All because you lose a huge deduction we can take on your tax return. Every year, my investor tax clients are reminded to harvest their portfolio losses and sell enough “losers” to match gains when possible. Or if they are carrying forward past capital losses on their return, to sell off enough gains to match those losses carried forward to end up with a net Zero capital gains tax. Simple stuff. Sadly, few do it.

For a sit-down or phone conference on the right way to buy alternative investments such as gold coins or bars, or to start buying Cryptocurrencies, I am available for general consulting in this area.

M.D. Anderson

Michael AndersonFinancial Strategies, Inc.