Our Services
Fee-Based & Portfolio Management Accounts
What is an Exchange Traded Fund? (ETF’s)
An Exchange Traded Fund, or ETF, is a security that tracks an index or a bundle of assets, S&P 500, Nasdaq 100, the Dow Jones Industrial Average or the Lehman Treasury Index. An ETF may also represent a particular industry sector...Read More >>
Why Are Investors Attracted to ETF’s?
- They tend to cost less.
- We believe there is a clear cost ratio advantage over mutual funds.
- There are no sales loads or investment minimums required to purchase an ETF.
- They may be more “tax efficient”
than mutual funds.
Exchanged Traded Funds are subject to risks similar to those of stocks. Investment returns may fluctuate and are subject to market volatility, so that an investor’s shares, when redeemed or sold, may be worth more or less than their original cost.
Trust Accounts
Through Wachovia Trust, Walnut Capital Management can provide you access to trust services which help you integrate your investment plan into your estate plan, safeguard your assets for future generations and have full access to professional trust expertise.
Together your Walnut Capital Management Team and Wachovia Trust1 provide you investment management capabilities and trust expertise from an organization with nearly 200 years of administration experience.
What is a Trust?
A trust is a legal device that allows you to transfer property to a trustee who will manage it for the benefit of you and your heirs and beneficiaries. The trustee can be the individual creating the trust or a neutral third party.
The assets held in a trust are directed by the trustee who is controlled by the terms of the trust. Assets held in trust generally avoid the probate process. In some states, avoiding probate can save time and reduce estate administration expenses. The assets, terms, and conditions of a trust are generally not subject to public inspection.
Trusts can often be effective in protecting assets from the creditors of a beneficiary. Assets may also be protected from a spouse or former spouse in the event of divorce of the beneficiary.
Living Trust
A living trust takes effect during your lifetime and may be either revocable or irrevocable. As its name indicates, a revocable trust can be changed or canceled at any time by the grantor. In contrast, an irrevocable trust cannot be altered or revoked once effective, but may serve important estate planning purposes.
Testamentary Trust
A testamentary trust is created within your will or living trust and becomes effective upon your death. Testamentary trusts are most commonly used to preserve the unified estate tax credit and reduce estate taxes.
Unified Credit Trust
A unified credit trust (also known as a “credit shelter” or “bypass” trust) may be used to take advantage of the unified credit allowance by directing the current exemption amount into the trust upon the death of the first spouse. The trust can provide lifetime income to the surviving spouse, but preserves the unified credit exemption amount of the first spouse to die. The decedent spouse specifies the beneficiaries who will receive the remaining principal in the trust following the surviving spouse’s death.
The Economic Growth and Tax Relief Reconciliation Act of 2001 is subject to a “sunset” provision. The provision (required by the Congressional Budget Act of 1974) required that the provisions of the Act do not apply after the end of the year 2010. Therefore, technically, all the 2001 rules, rate and exemptions come back into effect in 2011 unless action is taken by Congress.
Marital Trust
A marital trust is also funded upon the death of the first spouse. The surviving spouse is granted the power to designate beneficiaries of the trust principal that remains upon his or her death.
Qualified Terminable Interest Property (QTIP) Trust
A Qualified Terminable Interest Property (QTIP) trust is a variation of the martial trust. The QTIP trust can be an effective method of protecting the assets you plan for your children or grandchildren in the event your spouse survives you and remarries.
The QTIP trust must provide your spouse with a lifetime income. In some cases, the surviving spouse may draw down the principal of the trust, subject to certain limits. Once the QTIP trust is in place, it will make no difference if your spouse remarries or makes a new will.
Irrevocable Life Insurance Trust
An irrevocable life insurance trust is designed to provide liquidity to pay estate taxes. While a number of strategies enable you to reduce estate taxes, estates in excess of the allowable exemption amount may not be able to offset this tax liability and preserve the estate’s assets.
While insurance death benefits generally are not subject to income taxes, they are considered part of the estate and will therefore increase estate taxes due. A life insurance trust can solve this problem. An irrevocable life insurance trust owns a life insurance policy outside the estate, shielding the death benefits from estate taxes and making them available to family members immediately after the insured’s death.
Walnut Capital Management does not provide tax or legal advice. Be sure to consult with your own tax and legal advisors before taking any action that would have tax consequences.
Trust services offered through Wachovia Bank, a national banking association (chartered by the Office of the Comptroller of Currency) and wholly owned subsidiary of Wachovia Corporation.
(1) Wachovia Trust is one of the America’s oldest, largest and most respected trust companies. Walnut Capital Management understands your complete financial picture and can be your primary point of contact for all of your investing and trust needs. Talk with your Financial Advisor today about the full range of financial solutions now available through Wachovia Trust.