The reason I decided to focus on the TV show Yellowstone, is because I see some similarities in the show, with what we do for our clients. Kevin Costner plays a guy named John Dutton, who owns a ranch called the Yellowstone Ranch, in the general area of Yellowstone National Park. It is a large piece of land, and the Ranch has been in the family for several generations. John Dutton’s only mission in life is to keep the ranch at all costs. He even lost a child in the battle and have been involved in gunfights where both he and his kids have been shot.
There are quite a few characters besides John. John’s son-in-law, namely Rip, I think is everybody’s favorite character in the show. The other characters are John’s daughter, Beth, John’s youngest son Kayce, and John’s adopted son, Jamie. Beth who is an attorney, participated in an active hostile takeover of a law firm that was trying to do litigation against the ranch to take it. Also featured in various episodes are developers who want to bring jobs to the region. This is good for everybody except the Dutton family. There is talk of building an airport on the ranch which John Dutton does not want.
Constant Threats of Ranch Takeover
There is the threat that if John Dutton dies, there won’t be enough money to pay the death tax on the ranch. John Dutton and his family are willing to take massive action in order to keep what they own. There are many people who want to take over the ranch, and these scenes are played out in almost every episode.
I think most of us can relate to John, because if you own something and it has significant meaning, you want to keep it, and won’t let anybody steal it from you. By the same token, you don’t want to give it to the government or lose it to taxation. You may have some money in the bank which is money you have worked decades for, to build a nest egg. I am sure you would take action if somebody tries to steal your money.
What you need to understand is that the government rulebook is set up to take your money. Speaking from my own experience and watching what unfolds in my clients’ lives, I really feel like nobody is looking out for the middle-class anymore. It feels like a war on the middle class, because while the rich are getting richer, and the poor are getting poorer, the middle class are getting dragged down. A simple example is inflation, which is a symptom of the war on the middle-class.
The Secure Act
You may have heard me talk about the Secure Act, or have read about it. Essentially, the Secure Act was passed almost unanimously in 2019, and became law in 2020. Effectively, congress put a death tax on middle-class Americans, which impacts our retirement accounts, IRA and 401K.
It used to be the case that if you passed away, and you still had IRA or 401K money, you could leave it to your kids as an inherited IRA. If my dad left me some money when he passed away, assuming I’m 55 or 60 years old, I could take that money and invest it in the stock market. I could leave it there for a few decades, taking distributions along the way. Essentially, the money would grow, and I could use it during my retirement years. We had a situation where mom and dad’s retirement account would become the adult children’s retirement account. It was an opportunity for the adult children to save their own money and pass it on. Infact, the greatest transfer of wealth in human history is the American Baby Boomer. When they pass away, they would leave massive wealth, generationally speaking, to their children.
Death Tax on the Middle-Class
Along comes the Secure Act, which changes the way we can use inherited retirement accounts. Now, if my dad passes away, leaving me his retirement account, I have to pull all the money out of the retirement account within the first 10 years after he passes away. I cannot leave it in there for my life expectancy. If I’m 55 years old when my dad passes away, I’m likely still working, and in a higher income tax bracket. Now I have to take my dad’s IRA and add it to my tax return because it is ordinary income. This means I will get taxed even more. Before the Secure Act, we had 30 years to pay that tax, but now we have only 10 years to pay it. That feels to me, like a death tax on the middle class.
Long Term Care Expenses
The other challenge we face as middle-class Americans, is what happens if we get sick before we pass away. The health care system for seniors is a nightmare, and people are going broke. Nursing homes cost $160,000 per year! It is not because the nursing home is a bad organization. The problem is we are sold a promise that we will have healthcare in our retirement years. However, Medicare doesn’t pay for the single biggest health care expense which seniors face – custodial long term care. This means you pay privately for long term care, until you go broke.
Fortunately, the story doesn’t have to end badly. I can teach you how to protect yourself from the system. You can learn more when you come to one of our Workshops. I’m going to teach you how an asset protection trust can protect you from losing everything you’ve worked hard for. I don’t believe you’ve worked your whole life to save money and own a house, only to lose it all to a broken government system.
You can register on our website for our 3 Secrets Workshop. We look forward to meeting you there!