Case Study 7

Maximizing Income While Minimizing Risk

The death of her husband, Daniel, took Eleanor by surprise. As an executive at an investment management firm, Dan had always overseen the couple’s investments. As a result, Eleanor had never paid close attention to their finances or wealth transfer plans. To complicate matters, much of Eleanor’s $3 million net worth was concentrated in the stock of her late husband’s firm.

Eleanor turned to SunTrust Private Wealth Management for advice on making sound financial decisions during a difficult time. She chose to work with SunTrust because the SunTrust Advisor seemed genuinely interested in helping her make sense of her investments rather than selling her some new product. Eleanor’s primary goal was to maximize her income without significantly affecting her children’s inheritance. And, if possible, she also wanted to help support her college alma mater.

Eleanor’s client advisor first recommended she purchase an immediate life annuity.1 This would meet most of Eleanor’s income requirements, while allowing the balance to be invested in an equity portfolio earmarked for her children’s inheritance. To help minimize portfolio volatility, a SunTrust portfolio manager worked with Eleanor and her tax accountant to implement a staged sale of stocks within Eleanor’s portfolio.

Finally, SunTrust worked with Eleanor to implement a charitable gift annuity with her alma mater, a wealth transfer strategy that provides Eleanor with additional income and secures a legacy for her university.

Disclaimers

1Annuities are provided through SunTrust Investment Services, Inc. Immediate Annuities are irrevocable after the free look period has ended. Annuities involve fees not typically associated with other types of investments.

SunTrust Bank and its affiliates and the directors, officers, employees and agents of SunTrust Bank and its affiliates (collectively, “SunTrust”) are not permitted to give legal or tax advice. While SunTrust can assist clients in the areas of estate and financial planning, only an attorney can draft legal documents, provide legal services and give legal advice. Clients of SunTrust should consult with their legal and tax advisors prior to entering into any financial transaction or estate plan. Because it cannot provide legal services or give legal advice, SunTrust’s services or advice relating to “estate planning” or “wealth transfer planning” are limited to (i) financial planning, multigenerational wealth planning, investment strategy, (ii) management of trust assets, investment management and trust administration, and (iii) working with the client’s legal and tax advisors in the implementation of an estate plan.

These materials are educational in nature. The implications and risks of a transaction may be different from individual to individual based upon past estate, gift and income tax strategies employed and each individual’s unique financial and familial circumstances and risk tolerances.

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