Broker Check
Planning = Protection. How to Plan for Future Generations

Planning = Protection. How to Plan for Future Generations

August 22, 2022
Share |

To grow generational wealth requires proper planning and protection of your assets. When we plan for future generations, there are many factors to consider – legacy and education planning are some of the most important. There’s a well-known Chinese cultural saying, “Wealth does not last beyond three generations.” In American culture, it’s often translated to say, “Shirtless to shirtless in three generations.” This doesn’t have to be the case, with proper legacy and education planning coupled with the execution of strategies tailored to your unique situation, you will not only pass your wealth on to your loved ones but also assist them well into their futures. 

 Planning Your Estate

Establishing a legacy begins much earlier than you might think. Estate planning (also known as legacy planning) ensures your wishes are carried out at the time of your passing. Through my experience as a financial advisor, I've learned that these conversations can be tough to navigate on your own with your family. Most people try to avoid the topic altogether, leaving room for wealth to be distributed against their wishes. 

While our firm does not perform legal services, we advise clients with estate and legacy planning needs and help with the implementation by coordinating with attorneys to prepare associated wills, Power of Attorney documents, and living wills.

Tax-smart legacy planning is essential for all of us, regardless of our wealth. It becomes even more crucial when you own a business or have loved ones that depend on you. With the ever-changing tax landscape, it’s critical to have a CPA and financial advisor collaborate so they can formulate a plan for any changes that may arise to preserve your wealth. Changes like the anticipated gift tax exemptions set to sunset in 2025 can greatly impact your legacy plan. Establishing a plan and getting in front of these changes before they happen can better shield you and your finances.

Planning for Education Expenses

The single largest category of debt facing young people today is school loans. With a new school year kicking off, this is an optimal time to consider saving and paying for your child’s college expenses. As a parent or grandparent, you have likely thought about the cost of higher education, but if it’s far down the line ­– it can easily go by the wayside while other expenses take precedence. Saving for your child(ren)’s college in today’s world requires planning, strategizing, and selecting unique investments that are right for you and act as part of a broader financial plan. 

A 529 plan is an investment account that offers tax benefits when used to pay for qualified education expenses for a designated beneficiary. You can use a 529 plan to pay for college, K-12 tuition, apprenticeship programs, and student loan repayments. A recent bill has been introduced called the College Savings Recovery Act. If enacted, account owners could make a direct rollover into a Roth IRA for either themselves or their beneficiary, allowing parents and students the opportunity for tax-free retirement savings.

Where Do You Begin? 

I recommend setting up a time to chat, and together we can get started on a plan that will leave you and your loved ones feeling confident about the future.