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Estate Planningand

Protecting Your Investment

Chuck Lind, MMR

Youcan’ttakeitwithyouor

theonewiththemosttoyswins

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ProtectingYourInvestment

Whileyoucannotpreventadisaster,youcanmakeiteasiertorecoverwithabitofplanning

andpreparation.

Youneedtoconsiderseriouslythepossibilitythatsomethingdisastrouscouldhappentoyour

railroad.

Insurance

• Whatkindofinsurancedoyouhave?• Haveyoureviewedittomakesureyouhaveenoughcoverage?

• Properinsurancecoverageisusuallyoverlookedbymodelrailroaders.

• Mostinsuranceclassifymodelrailroadsascollectionssolimitedcoverage,likejewelry.

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• Benchwork – partofhousestructureorpartofcollection?Differentinsurancecarrierslookatthisdifferently.

• Liabilityissuesofmodelrailroadvisitors?

ModelrailroadsattachedtothehouseorseparatebuildingsneedspecificcoverageviaariderorotherspecificcoverageliketheNationalModelRailroadInsuranceoption.

Mostfolksdon’thaveanyideaaboutModelRailroadingandthisincludesInsuranceAdjusters.Mostthinkofacircletrackonaplywood base,soyouhavesomeworktodo.

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NMRACollectionInsurance

ThisserviceoffersNMRAmembersgrouppropertyinsuranceforcollections,layouts,livesteam,tools,slides,photographs,books,magazinesandrailroadmemorabilia.

nmra.orgLookunderMemberBenefits

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LayoutPlanning

Notwhatyouthink!

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• IfapersoncollapsedinyourrailroadroomhowwouldyouorEMT’sgetthemout?

• Firehowwouldyouandguestsgetout?Arefireextinguishersorsmokealarmspresent?

• BasicFirstaidkitpresent.

• Makesurethereisaphoneintheroomcellorlandlineforemergencies.

Inventory

“Itisthe insured’sresponsibilitytoprovethevalueoflostordamagedproperty.”

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Whatisit?

HighlymodifiedOn3BachmannShay-1st PlaceNNGC

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AllEnginesHaveaCode

AllBoxesHaveMatchingCode

Boxes?

Itrytosaveallmyboxesamodelinanoriginalboxwillusuallysellformore.FormyscratchbuiltmodelsImakeorpurchaseabox.

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ValuationGuidelines

GoodsourcesofinformationaredealerwebsitesandinternetsourcessuchaseBay.

ForRollingStockGoodRuleofThumb

Condition AskingPriceNeworlikenew 75-80%ListObviouslyusedbutundamaged 50%ListDamagedbutserviceableorrepairable 25%ListDamaged,partsonly 10%List

Beyondusableforparts zero(throwaway)

BuildingKits

Excellentcraftsmankitsthatareun-builtusuallyholdtheirvalueverywell.

Thechartbelowtakestheaveragevalue froCampbelltoFineScale

Currentlyavailable 1-3yearsold 75-85%ofListPriceOutofProduction 1-3yearsold 100%oforiginalPriceOutofProduction 3-10yearsold 150%oforiginalPriceOutofProduction 10-20yearsold 200%oforiginalPriceOutofProduction 20-30yearsold300%oforiginalPrice

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BuiltKitsBuilding&RollingStock

Thisisaverymurkyarea,ingeneralmodelsbuiltbyhobbyists areworthfarlessthanun-built

kits,simplybecauseofworkmanship.• Item isindistinguishablefromadetailedreadytorunplasticorbrassmodelwill

usuallybringabout80%oftheequivalentcommercialmodel.• Item isgeometricallyperfect, cleanlyputtogether,andifpaintednicelyfinished.

Howeverwithexaminationsomedetailsareobviouslymissing.60-75%oftheequivalentcommercialmodel.

• Sameasabovebutwitha substandardorincompletefinish50%oftheequivalentcommercialmodel.

• Modelisgeometrically skewedorshowsexcessorshearedglue10%oftheequivalentcommercialmodel.

Oneperson’sRailroadRoom

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Keeparecordofwhatgoesintobuildingandoperatingyourlayout.

AsimpleExcelspreadsheetshowingDatepurchased– Item– Value

Andkeepituptodate.

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Scale Road)Name Engine/Car)Type Number Manufacture Mfg)Number Notes )Value)

O

Chicago)North)Western 40')Steel)Box)Car 57776 Atlas 3002802L2 )$)))))))))45.00)

O Grand)Union 40')Wood)Reefer 90101 Atlas 77063 )$)))))))))45.00)

On3 West)Side 3)Truck)Shay 12 SunsetCustom)Paint)DCC )$))))1,475.00)

O Sierra)RR #5)Coach)&)#6)Combine)Set 5)&)6 Car)Works )$)))))))550.00)

O UP SD40ACE)Diesel 4141 MTHGeorge)Bush)Display)Only )$)))))))479.95)

On3 Tall)Pine 2)truck)shay Wiesman

Wiseman)Brass)Conv)to)Bachmann

Tall)Pine)Lumber)Company)Railroad)Inventory

Whatshouldyourinventorycover?

• Engines(BrassandPlastic)includeanythingdonetothem,decoder,paint,contestwinner.

• Rollingstockbesureto includewhatisontherailroadandkitsyettobebuilt.

• Buildingskitsandfinishedalsoextradetails.• Otheritems– vehicles,figures,detailparts.• Booksandmagazines.• Photos andslides.

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DocumentEverything

• Oneofthebestwaystodocumentyour layout(oryourentirehome)isphotos,eitherstillorvideo.

• Progressphotos ofthelayouthelptoshowwhatisunderthescenery.

• Photos ofthefinishedlayoutorfinishedandunfinishedareas.

• Hasyourlayoutbeenpublished?

WhenyouhavealltheinventorycompletedYouneedtoletfamilymembersknowwhereyou

havecopies.

Yescopies!Safeplace inyourhome

andKeepatleast1setoffsiteOtherfamilymembers

YourofficeCloudStorage

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Recoveringfromadisasterwilldependonhowwellyouhadeverythingdocumented.

Mostpeopletoldagentstheywishedtheyhadmoredata,not less,afteradisaster.

Getquotesfromaprofessionallayoutbuilderitwillhelpyouwhenyouareworkingwithan

adjuster.Keepyourdatauptodate!

EstatePlanningSomethingnobodywantstodo

Ifyou’reimmortal,youdon’tneedthisclinic.

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Makesureyouhaveacurrent will!

Problemismostwillsread,“Igiveandbequeath allofmytangiblepersonalpropertytomyspouse, ifmyspouseisliving,orifnot,tomychildrenlivingatthetimeofmy

death.”

Nowwhataretheygoing todo?

Itisararesituationwhereboth spousesareequallyinvolvedinmodelrailroading.

Ifyourspouseisn’tasinvolvedasyouare,itisunkindto leaveher(orhim)withasizeable

assetwithout information.

Muchoftheworkwehavealreadydiscussedwillprepareyourspousetohandleyourlayout

whenyoumovetothebigroundhouse.

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• Whyarewedoingthisclinic?

• Storiesofspouses gettingrippedoff.

• Storiesofspouseswhohavetogothroughtoomuchtogetthestuffgone.

• Storiesofspouses thathadinflatedvalues.

• Spouses thatweretold itwasn’tworthmuch.

Ifyoudon’twanttogiveyourwifearealisticappreciationofthevalueofyourtrains,and/or

youdon’twanttomakeiteasyforher,youhaveproblemsthatthiscliniccan’tproperly

address;youneedDr.Phil

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OScaleBigBoy$75.00

Conversationwithyourpotentialsurvivors

• Theyneedtoknowwheretheinventoryisandwhoarethecontacts.

• Youneedtodecide,together,whattradeoffsneedtobemadebetweentimeandeffortandmoney.

• Youneedtoanalyzethesignificanceofyourtrainsinrelationtotheentireestate.

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Whatgoesinwhatbox?

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Notallboxlabelsarehelpful

Ifyouhavecustompaintedanddecaledacarorgivethemanideawhereitbelongs

Betteridea– addaphoto

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• Understandtherelationshipbetweentime,labor,andmoney.

• Yougetlessforthestuffifyou’reinahurry.• Don’tcarewhichwayyougo,butyouabsolutelyneedtodiscuss.

• Doesthewidowwanttohaulyourstufftotrainshowsforthenextthreeorfouryears?

• DoesshewantthebenefitandhassleofeBay?• Consignment,sellers take15-30%cantakeyears.• Sell thecollection outright.

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HardbackBooks&Magazines

• Hardbackandsoftbound books representdifferentproblems.

• Youneedtolookatthepotentialresalevalueand,again,discuss timeandeffortversusmoney.

• Priceontheinsideofthebook isalmostuseless asaguidetowhatyoucangetforit.

• Don’tbemisled bysomeofthebookdealersinflatedprices.

• Dealinginthemagazinemarketisrarelyeffective.

Sellingtoadealer

• Thisisaquickwaytoselleverythingatonce.• Don’tallowthemtocherrypickthecollectiontheywillgetallthegoodstuffandyouhavethejunk left.

• Mostgooddealerswillreviewtheinventory,andfigurewhattheycansellin3months,6monthsandayearandwhattheywillhaveforever,whentheymakeanoffer.

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Taxes

• Knowwhereandhowtoresearchtaxconsequences.

• Taxadvisecanbewayoutofdatesixmonthsafteritisgiven.

• SellingoneBayandPayPalyouwillgetastatementofhowmuchyousoldandacopy isalsosenttoUncleSam.

Tomymindgettingthelayoutourofthehouseisamajorproblem,unless itwasbuiltin

modularform.Notonlyarewetalkingaboutalotofstuff,wearealsotalkingaboutalotofmaterialthatisnot

reusable.Thinkbackhowmuchtrack,benchwork andsceneryhaveyouseensurviveonemove.Theproblemiscompounded ifthe layoutis

attachedtothehouse.

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SentimentalValue

• Thinkaboutthis,everythingyouownisworthmoretoyouthatit’sworthontheopenmarket...otherwiseyouwouldhavealreadysoldit.

• Doyouhaveitemsofhistory,JohnAllenengineorcar?Maybelookatdonatingtoamuseumorhistoricalsociety.

Promises

• Didyoupromiseacertainpiecetooneofyourfriends.

• Howaboutwishesofhavingseveralofyouoperatorsgetacaroffyourrailroadforthemtorememberyouby.

• Doesyourspouse knowthosepromises,writethemdown.

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Thewayyoudealwithyourcollectioninlifemaybe,inasense,thewritingofyourownepitaph.Youwontbetheretodefendyourhopes anddreams,plansforyourfuture,yourlong-term

vision.Whatyourspouse andotherpeopleseewhen

theygothroughyourstuffmaybequitedifferentthanthe imageyouhopedtoportray

ofyourself.

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Thefrustrationofsortinganddisposingofthematerialpartofyourhobbymayleavepeoplewithasadlyinappropriateremembranceofyou.

Whatdoyouwhattobeyourlegacy?Noit’snottimetogiveupthehobbyandstartpackingitaway.Butnowisthetimetothinkaboutwhatyouwanttobecomeofyourhobby remainsandthatmaychangethewayyoucollect,store,documentandcullmaterialsandsupplies.

Or

Youmightconsideranalternative.InthemovieChattanoogaChoo Choo,the

openingscenepansawayfromagrave.Asyoumovebackfromthescene,yourealizethecoffin

isbeingloweredintoan85footboxcar.Perhapsyoucantakeitwithyoubutyoushould

startplanningforthatboxcarrightnow.

Thanks