Cruising Along - At A Discount!

I love to travel, especially on cruise ships.

Cruise Ship

There are so many reasons why. When you cruise you can see a lot of places on one trip and only have to unpack once. Your ship is your floating hotel, with much better accommodations and amenities than many local hotels. You don't have to pass through several crowded airports or train stations or take extended, cramped car or bus rides to go from place to place (and travel by water is really the only way to enjoy island hopping, like when in Greece or Tahiti, two of my favorites). When you're moving between ports you can enjoy the sun and fresh air, lots of great food and many varied, on board diversions. In fact, a cruise is a great way to travel with parents, children, grandchildren or other extended family because there are on-board activities for all ages. And you don't have to keep pulling your wallet out when you're on ship (and have to figure out the currency exchange) because most everything is already included in the cruise price!

I've gone on so many cruises over the years that many clients have asked me for my tips (particularly ones for saving money!), so here they are.

First, Get the Lay of the "Land"

Even if you don't have a clear idea of where you want to go and when, you can start out by searching some cruise websites. There are so many of them that you could get lost surfing the internet for days! My favorite place to begin is at VacationsToGo.com. It has some advanced search features that let you narrow your choices down to not only place, time and cost, but by ship. (If you're not familiar with a cruise line or ship, check out Conde Nast Traveler's ratings.)

Once you've narrowed it down to the trips and ships you may want to go on, check out some of the larger groups or organizations you may already be a member of (or would consider joining to get a good deal!), like Costco, AAA and AARP. Your credit card companies may also have travel departments that offer special packages and let you pay with your points. If you've accumulated a lot of airline miles, check them out too.

By this point, you should have your travel options and relative prices narrowed down. The next step is to...

Ask for Available Cabin Upgrades and Onboard Credits

When you're contacting the travel sources I've mentioned, be sure to find out what it would cost to upgrade, say, from an inside to outside cabin, an outside cabin without a balcony to one with a balcony, or to a higher deck (usually better). Also learn what type of onboard credit they'll give you if you purchase your tickets right away. This credit could cover things like hair salon and spa treatments, ship store purchases and meal upgrades (which I love if the ship has a specialty or gourmet restaurant!).

Now, Bring in a Travel Agent

Just shopping for cruises by yourself on the internet or with a few membership groups, can be a big mistake. You don't know what you don't know! As a "specialist" in my own profession, I realize the importance and value of getting proper, experienced advice.

You may think that bringing in a travel agent will cost you more money (but I haven't found that to be the case, as you'll see).

My favorite agent, when it comes to cruises, is AvoyaTravel.com. Once you've already narrowed down where you want to go and when - - and better yet, a particular cruise line or ship and some "starting" prices you've researched - - you can contact them and ask them to assign a specialist who has personal experience with the type of trip you want to take. The agent can not only help make recommendations as to a cruise line and ship, but also hotel (for while you're in port, usually on the day before or after the cruise), your air flights and excursions off-ship during the cruise. But here's the best part of using an agent...

You Can Negotiate!

It's difficult or impossible to negotiate price with a website or membership organization (or even directly with a cruise line), but when you've got an agent who wants to make a commission, anything is possible. I use that initial research I've done to challenge the agent to beat the deals I researched, including the prior cabin upgrade and onboard credit offers - - and I've found the agent will often come through with something even better!

Don't Accept a General Cabin Location

A mistake I've made is to book a general category of cabin, like inside or outside or even on a certain deck, to later find out when I got there that they assigned me a cabin way too forward (which will rock if seas kick up) or too rear (maybe catching the engine's fumes) or too close to a noisy or trafficked stairway or elevator. Before I finalize any booking, I now go onto the cruise line's own website and get the cabin chart for the particular ship. I then request one of my selected locations from whomever is selling the cruise and make sure the cabin I'm getting is identified before I put down a deposit. You may get some resistance on this, but hold your ground because if they really want your business they'll bother to get you assigned to a specific cabin!

Don't Automatically Use The Ship's Airline Package

Most cruise ships make deals with airlines and offer what appear to be unmatchable discounts if you purchase your flight tickets along with the cruise. However, I've found these are often substandard carriers, with uncomfortable departure and arrival times and several layovers. You don't want to start your cruise after enduring a long cramped flight with little sleep, no TV or video screen or wifi, and horrible food! Many times, when I've researched flights on my own, a more upscale carrier has non-stop flights with favorable departures and arrival times, at not much of a difference in price (or I can use my existing airline points to make up any difference). Again, negotiate (if the cruise seller already packaged the flight into the cost of the cruise) for a reduction of your total price if you don't plan to use their airline or flights. That reduction can offset any additional cost of buying the airline tickets on your own. The agent I mentioned may be able to help you book your flights.

Watch Out for Overpriced (and Boring) Excursions

The ships usually offer their own shore excursion packages, for when you arrive in each port on your trip. Don't just automatically sign up for the ship's recommendations. They may be helpful for highlighting the top tourist attractions, but you'll want to check out alternative tours. The ship's own tours are often "marked up" and you can register directly with tour operations more cheaply. This is another area where an agent can be helpful. Or you can do some research on your own and avoid a lot of crowded, not so interesting places and long bus rides. Also, don't try to do too many excursions. Take some "break" days in between to just relax!

The "Art" of the Deal Isn't Over Until After You Arrive on Board

I try to get to the cruise port and check in as early as possible on the day of departure. When checking in, before I even get onto the gangway to the ship, I inquire about any unfilled cabins and upgrades available. Rarely are ships completely full and you'll be surprised how willing they are to upgrade you at very little price difference (particularly if you indicate you are a frequent traveler!). Once I get on the ship, I check out my cabin right away to be sure it's to my liking. If it's not, I'll go to the front desk to swap it for a suitable replacement (without little or no additional charge).

Don't Chase the Deals, Let Them Come to You!

Although you may not like getting a lot of email, when it comes to saving money on cruises, signing up for emails can alert you to special, limited-time offers you might otherwise miss. Register your email address with the various websites, organizations and companies I mentioned earlier. And watch out for any regular mail or email you may get from a cruise line that you've traveled on before. They often have very special discounts for repeat customers. What's the worst case? You can always "unsubscribe" if you start getting too much mail.

Bon Voyage!

I don't pretend to be a cruise expert, but hopefully you'll find some of my tips helpful. By the way, if you have a few of your own cruise tips, please share them with me! Happy Cruising!

Planning for a Vacation Home

Vacation Home

I'm sure you've spent a wonderful vacation at a unique and dreamy location and said, either aloud or to yourself, "I wonder what it would be like to live here?" If you answered that question by investigating the details of purchasing a vacation home in that perfect spot, it would be wise to consult with an attorney early in the process to avoid getting into hot water later on.

A new second home or rental property can be a welcome escape or sanctuary from the daily grind. It also can provide some tax benefits with proper planning. Experts say that whether you are purchasing a home, enjoying home ownership at present or selling a vacation home, it is important to become familiar with the applicable tax rules in order to minimize your tax exposure.

Now becoming familiar with and actually having the Federal Tax Code at your fingertips every hour of the work day are two vastly different things. Certainly, you will want to have a solid understanding of taxes on the property specifically and on your estate generally. Regardless, in the end you really need to leave the heavy lifting to a professional.

Don't Try This at Home!

There are many self-help books and guides available in many areas of life. Taxes and property transactions are not two that you should tackle ­- especially if you are looking at a vacation home in another state or are considering purchasing a home internationally. If you are considering the purchase of a vacation home, you may qualify for some tax benefits for that new beachfront condo on Maui or your ski-in cabin in the Rockies. We say "may" because the types and amount of taxes, credits and deductions are based on how you use the property.

If you use the new vacation place as a second home instead of renting it, interest on the mortgage is deductible. You can write off 100% of the interest you pay on it up to a total of $1.1M of debt, as secured by your first and second homes when used to acquire or improve the properties. You also can deduct property taxes on your second home.

However, (and here's where it gets tricky) if you rent out the property for more than 14 days, you are required to report all rental income. You also may deduct rental expenses, but this can get confusing. Why? Because you must allocate costs between the time the property is used for personal purposes and the time it is rented.

Sometimes the costs will be more than income ... what then? Whether a loss can be applied towards other income depends upon the percentage of time you use the property yourself and your income.

Speak to an Attorney

When you are eying a property to buy or are selling a home, it's best to speak to an attorney sooner rather than later. He or she can help you navigate the process while ensuring that you are protecting your assets and properly setting up your estate.

So, contact an experienced attorney and start packing for that new vacation home!

What Is A Legacy Letter?

Get Your Act Together

Legacy letters? Sounds like something earned in a college Glee Club sometime in the 1950s. No, that's not quite it. A legacy letter can be an additional part of your estate plan and can be a way to ease disputes and clarify your intentions for the division of your personal property after you pass away, like jewelry, family memorabilia, collectibles, and other possessions kept in your home. A legacy letter can also be written to share important moments or things in your life with the people in your life whom you treasure the most. In other words, a legacy letter is a tangible way to "bequeath" memories, lessons and final wishes to your family after your passing. This is in contrast to monetarily valuable items, such as cash and real estate, which are instead passed through a will or trust.

Getting Started

Usually a legacy letter is written just like an old-fashioned letter you send via the U.S. Postal Service, and sometimes it takes the form of a collection of the values, memories and lessons learned throughout one's lifetime. (Kavesh, Minor and Otis provides our clients with an "Estate Planning Portfolio" binder which, at the tab "Directions Letter", contains forms that can be used to prepare this legacy letter.)

For example, you and your estate planning attorney may have established a detailed and thorough estate plan. Part of that plan may include a will, medical directive, and a trust. A legacy letter can supplement that plan by giving specific instructions to a beneficiary concerning a bequest. Let's say you have a daughter and two sons. One of the wedding gifts you received long ago is a beautiful and silver service and silverware. You'd like your daughter to have this wedding gift for her home when she gets married. In a legacy letter, you can explain the source of the wedding gift, the significance of the bequest and your intention to have her pass it down to your granddaughter someday. In the letter you may describe how the silver represents your many years of happy marriage and wonderful family gatherings; it symbolizes how important the idea of family has been in your life and your hope that your daughter will enjoy the same.

Is It Binding?

A legacy letter isn't a binding legal document. It is an informal, practical means to provide small bequests additional information regarding why you are giving a specific bequest to a specific individual. After you are gone and your estate is administered, it would be very hard to enforce your intention as to the silver. Your daughter may sell it the next day, but at best, she will know why it was given to her and what you hoped she would do with it.

Most people who receive a bequest with a legacy letter would take the direction to heart and realize the significance of the gift. However, no one (except maybe your sons) will be concerned about what your daughter does with the silver. If you think a particular item of personal property is very valuable or it will be fought over despite your legacy letter, then maybe you should include the bequest of that personal property in your will or trust.

However, in most cases a legacy letter is a good idea. Your words and thoughts may be as valuable to your beneficiaries as the gifts themselves.