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Plan carefully with stocks, investments for smooth estate transfer

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  Published in Stocks and Investing on Wednesday, September 10th 2025 at 20:20 GMT by Cleveland Jewish News
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Stocks, Mutual Funds, and Other Investments: The Cornerstone of a Smooth Estate Transfer

By [Your Name] | Cleveland Jewish News

When it comes to passing on wealth, many people still picture a pile of cash or a house in the hands of their heirs. In reality, the bulk of a modern estate is often buried in the stock market, retirement accounts, and other investment vehicles. A recent feature in the Cleveland Jewish News – “Plan Carefully with Stocks, Investments for Smooth Estate Transfer” – dives deep into why these assets deserve special attention and how savvy planning can keep them out of probate, reduce taxes, and preserve family legacy.

Why Stocks and Investments Matter

The article opens with a stark statistic: $2.5 trillion of U.S. net worth is tied up in stocks and other securities—a figure that dwarfs the median value of a family home. Yet, because many brokerage accounts lack a “payable‑on‑death” (POD) designation or a named beneficiary, these assets can become part of a protracted probate process. That can delay distribution to heirs, inflate legal costs, and even expose the estate to unintended tax consequences.

“You can’t just assume your investments will automatically go to the people you love,” says estate attorney Marta Greenfield. “If they’re not properly titled, they become public property until the court decides.” The article emphasizes that a well‑structured plan can sidestep this maze.

The Power of POD Designations

A POD designation is a quick, inexpensive way to transfer securities directly to a chosen beneficiary upon death. The Cleveland Jewish News explains that most brokerage firms now allow clients to set this up through their online platforms. The article advises:

1. Name a primary and contingent beneficiary—ideally, the spouse first, then children or grandchildren.
2. Review the designation annually—life changes (marriages, divorces, births, deaths) can invalidate a POD.
3. Keep the designation separate from the account’s “pay‑to‑the‑account” instructions, which might otherwise override the POD.

Greenfield adds that “PODs are not just for stocks; they work for bonds, mutual funds, ETFs, and even business interests held in a brokerage account.”

Trusts: The Ultimate Probate Avoidance Tool

While PODs handle many securities, certain assets—like private company shares, real estate, or highly illiquid holdings—require a different strategy. Here, the article turns to trusts, offering a primer on their most common types:

The article quotes financial planner Daniel Kaplan, who explains that “the right trust structure can turn a complex, multi‑asset estate into a manageable, tax‑efficient package.” Kaplan stresses that the choice of trust depends on the size of the estate, the nature of the assets, and the family’s goals.

Inheriting Stocks: The “Step‑Up” Basis Advantage

A section of the article is devoted to the “step‑up” in basis—a tax rule that adjusts the cost basis of inherited securities to their market value at the time of the original owner’s death. Kaplan notes that this can dramatically cut capital gains tax for heirs. He gives an illustrative example: a stock purchased for $5,000 that has risen to $50,000 at the time of death will be taxed on the $45,000 gain, not the entire $50,000.

However, the article warns that “the step‑up only applies to inherited assets, not gifts.” Thus, a well‑timed gift strategy may be necessary if the estate’s value is approaching the federal estate tax threshold (currently $12.92 million).

Estate Tax Considerations

Even with a robust trust and POD strategy, the article reminds readers that estate taxes can still loom large. It cites the IRS’s current estate tax exemption and explains how state‑level taxes can differ. For instance, Ohio imposes no separate estate tax, but some other states still do. Kaplan advises consulting a tax specialist if the estate exceeds the federal exemption, particularly when dealing with intangible assets like stocks, which can be more heavily scrutinized than tangible property.

Practical Steps for Cleveland Residents

The article concludes with a checklist tailored to the local Jewish community:

1. Set up or update PODs on all brokerage accounts—most major firms provide a simple online form.
2. Review beneficiary designations in retirement plans (401(k), IRA) to ensure they align with your wishes.
3. Assess the need for a trust—particularly if you own a family business, private investment, or substantial real estate.
4. Revisit your estate plan annually or after major life events.
5. Engage a Cleveland‑based estate attorney or financial planner—the article highlights several reputable firms, including Greenfield & Associates and Kaplan Wealth Management.

The Bottom Line

“Planning with stocks and investments isn’t optional—it’s essential,” says Greenfield in closing. “The right structure protects your heirs, preserves wealth, and honors the legacy you’ve built.”

By taking these steps now, families in Cleveland and beyond can ensure that their hard‑earned portfolios—rather than probate delays or tax burdens—serve as the true heirs of their legacy.