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Giving while you're living: through a living trust, Brenda Brandle is helping her 16 nieces and nephews enjoy her wealth now.

When Brenda Brandle, a cafeteria manager in the Los Angeles Unified School District, decided to straighten out her finances in 1999, she knew she had her work cut out for her. Besides needing to reduce her debt and provide for her retirement, Brandle, who has never married and has no children, was determined to help her 16 nieces and nephews start out on the path to financial security. In pursuit of this goal, she had been exploring ways to invest her money on their behalf. But she realized early on that she needed help.

Attending a financial seminar given by George B. Thompson, a Church of God in Christ minister and Smith Barney financial adviser, Brandle responded enthusiastically to his message about the importance of attaining financial independence. "I called him up a few days later to talk, because I felt he could help me reach my goals," she recalls. Shortly thereafter, the two developed a plan, which Brandle began implementing immediately.

"When I went to her house she had jugs filled with $8,000 in coins, $95,000 in inherited funds, and a 403(b) from her job," Thompson says. "We sat down and discussed her goals and the best way for her to accomplish them."

Thompson, author of Millionaires in Training (Prosperity Publishing; $12.95) devised an investment plan that would allow Brandle to reap immediate results while working on her long-term goals. "Our major objectives were to reduce her debt, invest to grow [principle], save for retirement, and set up a living trust," he says.

After conversations with Thompson, Brandle realized that she could make a living trust a crucial element of her estate planning:

According to the terms of the trust, her nieces and nephews would receive a specified amount of interest on their birthdays; their spouses, however, would receive nothing. "If my nieces and nephews die without ever having had children, the funds will be donated to deserving students at historically black colleges, on the condition that the recipients also help someone else," she explains.

By establishing the living trust for her nieces and nephews, Brandle demonstrates an innovative way to exercise DOFE Principle No. 10: to ensure that my wealth is passed on to future generations. "I liked the living trust idea a lot." she says. "A living trust goes by what I specifically want and is more feasible for what I want to accomplish."

Brandle's commitment to pass along her wealth to her nieces and nephews reflects a family tradition. She benefited from property she received from her parents. "My parents invested and taught us how to do the same, and my siblings have all invested as well," she says. Brandle sees investing for her nieces' and nephews' benefit a logical, natural step. "I have no kids of my own, and according to the Bible, a good parent should provide for the generations. Since I'm not a parent. I want to provide for my nieces and nephews. Plus, I'm still keeping my investments in the family," she declares.

10 PRINCIPLE

To ensure that my wealth is passed on to future generations

Declaration Of Financial Empowerment

From this day forward, I declare my vigilant and lifelong commitment to financial empowerment. I pledge the following:

1] To use homeownership to build wealth

2] To save and invest 10% to 15% of my after-tax income

3] To commit to a program of retirement planning and investing

4] To engage in sound budget, credit, and tax management practices

5] To measure my personal wealth by net worth, not income

6] To be proactive and knowledgeable about investing, money management, and consumer issues

7] To provide access to programs that will educate my children about business and finance

8] To support the creation and growth of profitable, competitive black-owned enterprises

9] To use a portion of my wealth to strengthen my community

10] To ensure that my wealth is passed on to future generations

Thompson is pleased that Brandle embraced the living trust because, he says. its benefits are too good for any conscientious investor to pass up. "The advantages of a living trust are that, one, it eliminates the cost of probate fees; two, it reduces estate taxes considerably; and three, it clearly outlines the flow and distribution of the assets, so there is no room for misunderstanding what and how she wants things to happen," he says.

Thompson points out that when people die without a will or trust, the state decides what happens to their assets. "A trust is like a blueprint of how you want things done, and it allows you to break down the distribution of the money over a period of time," he says. "In this way, the transference of wealth is more defined, and the money cannot be given to anyone else beside the intended recipient."

"Now," Brandle say, "I'm looking forward to formalizing my estate planning and reaching my goal of becoming the first black female to majority--own both a restaurant and a restaurant supply company." Since her mother was a talented cook who passed on her art to her daughter, Brandle has another tradition she hopes to leave to posterity.

To make sure that your wealth is passed on properly, remember these points of advice:

Adopt an effective investment strategy. You can't pass along wealth if you don't invest wisely. Brandle sought out Thompson, who invested her $100,000 in mutual funds, using an aggressive asset allocation strategy: 2% in cash, 10% in fixed income, 55% in large cap equities, 16% small-cap equities, 15% in core international equities and 2% in emerging markets. Since 1998, Brandle's return op her investments has averaged 18.3% a year.

Make estate planning a priority. Often individuals delay estate planning and potentially put their legacy at risk. In the case of Brandle, she wanted to ensure immediate transfers of money to her nieces and nephews. The living trust was her answer.

Pass on the tradition of giving. It was important to Brandle to carry on a family tradition. When giving becomes a ritual, wealth will always be gassed on to future generations.
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Title Annotation:Black Wealth Initiative
Author:Brown, Carmen
Publication:Black Enterprise
Geographic Code:1USA
Date:Jun 1, 2004
Words:1019
Previous Article:June 2004.
Next Article:A life pursuing real estate: after being laid off from his job, John Young is shifting to a career managing properties.
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