Creating a Lasting Family Legacy

As we talk with clients about estate planning matters, we often hear that the clients’ first priority is to build a secure financial foundation that will support their children for years to come. That is certainly a key goal for most people. But what we hear much less often is a carefully considered plan for making that long-term security a reality. This, of course, is where a financial planner can provide the greatest assistance: helping family stewards develop strategies for insuring that their wishes and aspirations for future generations are actually carried out.

It often surprises clients to learn that some of the fundamentals of sound estate planning are neither expensive nor do they necessarily involve hiring a lawyer. Let’s take a look at four steps that should be on the short list for anyone concerned with creating a lasting family legacy.

1. Take advantage of the easy opportunities. This is often as simple as giving strategic thought to the titling of accounts and the ownership of assets. For example, married couples will often hold most or all of their assets in joint accounts. But selectively holding certain assets in separate names could facilitate the use of trusts to protect the assets of one spouse from liability to creditors of the other during life and also provide more options for disposition of trust assets upon the death of the grantor.
2. Review your documents annually, at least. No estate planning document—will, trust, or even life insurance beneficiary designation—stays current indefinitely. Things change: people die, people get divorced, businesses are bought and sold, children and grandchildren are born, and the list goes on. Certainly after any major life or financial event, and probably at least annually, you should carefully review your estate planning documents and make any alterations indicated by changes in your situation.
3. Don’t “keep it in the family” when choosing your executor. The duty of executor often falls to the oldest child or another trusted family member or close family friend. But too frequently this creates an undue burden on someone whose only qualification is emotional attachment to the estate grantor. Especially for estates with complex holdings—real estate, closely held businesses, and other assets that may even be in different states or countries—the probate process and possible disposal of assets can be very time-consuming and complicated. Often an institutional executor is the best choice, especially when the institution has trained a professional personnel who can efficiently handle the details in a dispassionate, logical way. Such executors can also become an important source of information and guidance to heirs and other interested parties.
4. Communicate with the next generation. Conversations around inheritance, estate planning, and financial arrangements are difficult, not least because they involve the necessity of thinking about the passing of loved ones. But the more that heirs and beneficiaries of the estate can understand in advance about the arrangements and intentions of the grantors, the better equipped they will be to utilize the benefits of the estate in the intended way.

Planning for smooth transitions and strategic transfers of wealth can seem intimidating. But a professional, fiduciary financial advisor can guide you along the path that will help you realize your priorities for your estate, helping to insure that its benefits are realized by those who are most important to you. If we can help or answer any questions, please get in touch.

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Go to the Bernhardt Wealth Management Blog where this was first published to read this and other blog entries.

About Gordon J. Bernhardt: President and founder of Bernhardt Wealth Management and author of Profiles in Success: Inspiration from Executive Leaders in the Washington D.C. Area, Gordon and his team provide financial planning and wealth management services to affluent individuals, families and business-owners throughout the Washington, D.C. area. Since establishing his firm in 1994, he and his team have been focused on providing high-quality service and independent, unbiased financial advice to help clients make informed decisions about their money. For more information, visit Bernhardt Wealth Management and Profiles in Success.