Allen Financial is a team of local professionals with a unique blend of state-of-the-art technology, extensive financial education and experience, and a hometown understanding of our clients’ lifestyles and goals. We share more than a common interest in your financial security—we share an interest in our community and life in Maine. We work hard to make it the best it can be.

We offer a complete array of financial planning services and we look forward to working with you to create a financial plan that meets your specific goals.


Partnering With Non-Profit Organizations

Article: 5 Tips for Larger and Planned Gifts

 

Allen Financial’s professionals have the experience and knowledge necessary to provide investment management, fiduciary support and endowment building through planned giving and donor gift design solutions to non-profit organizations large and small.

Combined with our high-touch service, we tailor solutions which help meet the needs of your staff and board members. Our services can include:

Investment Management
Our investment philosophy is rooted in the principles of Modern Portfolio Theory, which states that portfolio risk can be reduced through the combination of asset classes that are not perfectly correlated. We construct and manage a low-cost diversified portfolio by:

  • Determining the appropriate asset allocation and target ranges based on spending policy, risk tolerance and time horizon.
  • Utilizing index funds and ETFs* with very low investment expenses.
  • Ongoing portfolio monitoring coupled with quarterly rebalancing to targets.
  • Processing securities gifts for a small transaction fee and no commission.
  • Meeting at least annually with the Board of Directors and/or Investment Committee.

Endowment Consulting
We offer organizations the opportunity to increase their capacity to engage donors in the process of gift planning to support their critical missions for the long term, building the organization’s financial sustainability.

To accomplish this, we work with staff and board members engaged in endowment building efforts through planned giving education and training, and work with individual donors and families. Our expertise includes:

  • Developing policies and procedures for solicitation and acceptance of gifts.
  • Stewardship and cultivation of donors including the design of legacy societies and gifting strategies.
  • Facilitating the creation of sound investment management and spending policies to demonstrate to prospects and donors appropriate asset stewardship.

We believe in a straight-forward and transparent endowment management  approach to maximize donors’ and organization’s dollars to be spent supporting their mission and that can provide consistency through the changing tides of staff, board and committee members.

*An exchange-traded fund (ETF) is similar to a mutual fund that tracks a specific stock or bond index, such as the Barclays Capital 1–3 Year Treasury Index. ETFs trade on one of the major stock markets and can be bought and sold throughout the trading day, like a stock, at the current market price. And, like stock investing, ETF investing involves principal risk—the chance that you won’t get all the money back that you originally invested—market risk, underlying securities risk, and secondary market price.

Accumulation

Accumulation planning addresses an individual’s investment needs, asset allocation, and the suitability of different types of securities in light of your goals and risk tolerance.

In today’s world, there are common needs and desires people seek to accomplish. To protect their ability to earn and accumulate wealth, many people choose to hold insurance, as well as maintain an emergency fund, to guard against depleting savings that are intended for other goals.

Asset allocation is used to distribute your investable assets among a variety of investment categories. This process aims to:

  • Reduce overall investment risk
  • Create more reliable investment forecasts
  • Improve the risk/return tradeoff of your portfolio

Accumulation planning also involves the choice of securities for your investment portfolio. Basic securities are stocks, bonds, and mutual funds. Separately managed accounts, indices, option strategies, short-term assets, and annuities also may be used to optimize your portfolio.

Alternative investments may also be an option for the right investor. One of the premier features of alternative investments is diversification, resulting from the inclusion of investments that react differently to the markets than more traditional investments. Managed futures, hedge funds, oil and gas, tax shelters, and real estate are all examples of alternative investments. These products generally involve substantial risk and limited liquidity.

Some situations require different expertise than typical stock and bond portfolio implementation. These situations usually pertain to employer-related retirement plans and stock options, margin strategies, and real estate exchanges.

Most investors understand that as risk increases, the potential for return also increases. But there is a point for every individual where the level of risk is not worth the potential return. The goal of asset allocation is to provide you with the risk/return scenario that is most comfortable for you.

Investors should note that diversification does not assure against market loss and that there is no guarantee that a diversified portfolio will outperform a non-diversified portfolio.

Alternative investments may be illiquid in nature, redeemed at more or less than the original amount invested, subject to special risks and not suitable for all investors.

Taxation Planning

Tax planning considers the tax implications of individual, investment, or business decisions, usually with the goal of minimizing tax liability. While decisions are rarely made solely on their tax impact, you should have a working knowledge of the income or estate tax issues and costs involved.

A major goal of tax planning is minimizing federal income tax liability. This can be achieved by:

  •     Reducing taxable income through income deferral or shifting
  •     Deduction planning
  •     Investment tax planning
  •     Year-end planning strategies

Investment tax planning involves evaluating how to best position assets in order to minimize the amount of taxes you have to pay on an ongoing basis. This requires year-round planning, and it begins with an in-depth understanding of the tax implications of various investments and investment strategies, including:

  •     The treatment of wash sales
  •     Tax-exempt investments
  •     Gains and losses
  •     1031 exchanges
  •     Qualified dividends
  •     Options strategies
  •     Tax-deferred investing
  •     Passive income and losses
  •     Mutual fund taxation

If you give away wealth, during life or at death, you may incur federal taxes—and possibly additional state taxes. These taxes include gift, estate, income, and inheritance taxes. You can help protect the assets you transfer from excessive depletion by understanding these taxes and the various strategies you can use to minimize them.

Tax issues are never far from the mind of the business owner, and it’s likely that many of the decisions you make will be tax-based. It starts with the formation of your business and continues through the sale. Your choice of business entity, how you pay out profits to the owners, and your accounting decisions will all have an effect on your tax liability.

Some events in life—retirement, for example—come with tax considerations. Life event planning focuses on the impact of significant events on your life, as well as on the stages of your overall investment plan.

This material has been provided for general informational purposes only and does not constitute either tax or legal advice. Investors should consult with a tax or legal professional regarding their individual situation.

IRS Circular 230 Disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for any purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed therein.

Retirement Planning

Retirement planning involves evaluating your current financial standing and creating an accumulation strategy that will help to ensure a desired retirement lifestyle. Because an individual’s retirement years can span decades, retirement planning generally dominates other financial goals. A successful plan put into place during the wealth-building lifespan should address ways to maximize growth and tax-efficient distributions, as well as how to leave retirement assets to the next generation.

There are several ways to save for retirement: qualified employer-sponsored plans,  individual retirement accounts (IRAs), personal savings, and executive deferral plans.

Qualified plans are employer-sponsored retirement plans such as 401(k)s and pension plans. While there are contribution limits and strict distribution rules, these plans are popular because of their tax benefits. Generally, employers will make participation even more attractive by matching all or a portion of an employee’s contribution. It’s important that you choose the optimum plan to benefit the key people in your company.

IRAs are inexpensive, easy to establish and maintain, and also offer favorable tax incentives. They can be created by an individual or provided by an employer. Most people use IRAs to consolidate retirement savings that were previously held in employer-sponsored plans. Our process coordinates your IRA investments with your other savings plans.

You may find that qualified plans, IRAs, and social security won’t provide enough money to support your desired retirement lifestyle. By identifying your retirement gap, you can develop a strategy for personal savings invested outside of the traditional retirement vehicle.

Business owners or executives may have access to other tax-advantaged retirement savings vehicles. Nonqualified executive compensation is a generic term used to describe a compensation arrangement that provides retirement income—and, in some cases, death benefits—to key employees of a business.

At the heart of any retirement plan is the distribution of accumulated assets. The correct distribution method will help to ensure that your retirement savings last beyond your lifetime with minimum shrinkage from taxes. From premature distribution options that allow access to retirement assets prior to age 59 ½, to products intended to provide stable monthly payments for retirement, distribution planning is paramount to a successful retirement plan.

Estate planning creates a master plan for the management of your property during life and the distribution of that property at death.

Estate Planning

Estate planning creates a master plan for the management of your property during life and the distribution of that property at death.

For most people, estate planning will:

  •     Give more control over assets during life
  •     Provide care when disabled
  •     Allow for the transfer of wealth to whom and when wanted, at the lowest possible cost

Common estate planning issues addressed in the wealth management process include:

  •     Transfer of wealth
  •     Minimization of transfer taxes
  •     Asset protection
  •     Charitable giving

Wealth transfer planning involves the smooth transition and distribution of wealth according to your wishes. With proper estate planning, you decide to whom, how, and when your assets will be distributed, as well as who will manage your estate or business. Special issues you may deal with are providing financial security for others, planning for children of a previous marriage, equalizing inheritances fairly, and retiring from your business. Wealth transfer planning also involves the management of assets during disability or incapacity.

A major goal of estate planning is to minimize potential taxes without interfering with your other financial goals. If you give away wealth, during life or at death, you may incur federal—and possibly state—taxes. You can help protect the assets you transfer from excessive depletion by understanding these taxes and the various strategies you can use to minimize them.

If you own substantial assets, creditor protection can be a concern. Creditors can come in many forms. An asset protection plan first identifies potential exposure and then identifies preventive tools and strategies to reduce exposure. Asset protection planning deals with ownership issues, liability insurance, statutory protections, special needs trusts, offshore and domestic trusts, prenuptial agreements, divorce, and business dissolutions.

Charitable giving is motivated by both personal and tax incentives. Congress encourages charitable giving through tax legislation that can minimize your income and estate taxes. Charitable planning involves selecting the gifted property and charitable structure that will target your needs.

Our process does not end with estate planning but coordinates your estate plan with your overall plans for your business, investments, insurance, and employee benefits.

This material has been provided for general informational purposes only and does not constitute either tax or legal advice. Investors should consult with a tax or legal professional regarding their individual situation.