Thompson Family Trust

The Thompsons are a dual-income household — David (58) is a senior partner at a regional law firm and Linda (55) manages a private physical therapy practice. Combined household income of roughly $620K. Trust currently holds $2.4M in diversified assets across three brokerage accounts and a rental property portfolio worth approximately $1.1M. They carry a $340K mortgage on their primary residence (on track for 2031 payoff). No significant consumer debt. Both have employer-sponsored retirement plans with approximately $1.8M combined. Two adult children — one finishing medical residency, one in graduate school. David's mother (82) is in assisted living, funded partially by the trust.

David wants to retire from the firm within 3 years while maintaining their current lifestyle. Linda plans to continue her practice part-time. Primary goals: (1) Generate $180K/year in retirement income without depleting principal, (2) Fund both children through their remaining education without loans, (3) Ensure David's mother's care is covered indefinitely, (4) Begin a structured gifting strategy to reduce estate tax exposure. David said: "I don't want to be the guy who worked his whole life and left a mess for everyone else to figure out."

The rental portfolio is cash-flow positive but illiquid — selling any properties triggers significant capital gains. David's partnership agreement includes a non-compete and a buyout that will be paid over 5 years, creating income uncertainty during the transition. The assisted living costs for David's mother ($8,200/month) are rising faster than projected and the trust's allocation for her care may fall short within 4 years. The gifting strategy conflicts with maintaining the $180K income target — they haven't reconciled these competing priorities.

Without a coordinated plan, David's retirement could force a fire sale of rental properties at a tax disadvantage. The gap between mother's care costs and trust allocation will become a family crisis within 4 years — likely requiring David's children to contribute or the family to consider lower-quality care. The lack of a gifting strategy means the estate faces an estimated $380K in avoidable estate taxes. David expressed it clearly: "If I don't get this right, Linda ends up managing problems instead of enjoying retirement, and my kids inherit stress instead of stability."