Legacy. What a sophisticated word that is kind of fun to say. Not as much fun as saying salsa, but close!
When we hear people talk about legacies, we think of families like the Rockefellers—the great American family fathered by oil tycoon John D. Rockefeller. According to Forbes, the Rockefeller family legacy is alive and well today with an approximated family net worth of $8.4 billion, earning them the number #43 spot on Forbes’s 2020 Richest American Families Net Worth. Growing up, my parents would respond to my requests to buy the comforts that life has to offer with, “Who do you think we are? The Rockefellers?!” Maybe you heard something similar.
Webster Dictionary defines a legacy as “a gift by will, especially of money or other personal property.” Meaning that if you have accumulated enough financial resources and do not spend it all during your lifetime, you may have an opportunity to leave money to future generations or charitable organizations.
All of this sounds great—you saved well and have lived within your means and now must figure out what to do with your excess assets. Because legacy is often talked about in terms of excess assets, many believe legacy planning is reserved for high net worth individuals and families. It is true that being in the high net worth category requires legacy planning, but it is also true that you do not need to be a Rockefeller, Jeff Bezos, or Bill Gates to leave a legacy!
Here are three questions to ask yourself to help get the legacy conversation started.
- Do I have a desire or is it a financial goal to leave a legacy for future generations?
This is a very important place to start. Legacy planning does not require you to have an abundance of excess to leave for future generations, but even if leaving a legacy is not your goal, you should consider estate planning strategies to reduce emotional and financial stress on loved ones.
If leaving a legacy is a financial goal of yours, move on to question two. If not, move on to question two anyway. Who knows—you might just change your mind.
- To whom would I like to leave my legacy and why?
It is important to identify whom you would like to leave your legacy to and why.
- Do you want to leave a legacy to your children, grandchildren, or maybe great grandchildren?
- Do you want to leave your legacy to a university, favorite charity, or a cause for which you have a great passion?
Once you have identified to whom you would like to leave your legacy, consider why you want them to receive your legacy.
- Would you like it to be used for education, housing, health care, or to maintain a certain standard of living?
- Do you have a family member with special needs that may require assistance for their lifetime because they do not have the ability to live independently?
It is important to remember this is your legacy and you can choose who receives the benefits of it and how it can be used.
Knowing to whom and why can be the most difficult part of legacy planning and most likely the reason some do not complete a plan. As my parents always told me, “If it was easy, everyone would do it!” And if everyone planned their legacy, I would not have been compelled to write this blog.
- What are the best and most efficient tools and strategies to leave my Legacy?
Once you have completed the hardest parts of the legacy planning process, you can begin to explore the best and most efficient planning tools and strategies. The tools and strategies are what allow you to implement your plan.
Most people have heard of some of the better-known tools and legacy planning strategies, such as a simple will, revocable living trusts, irrevocable trust, or generation skipping trust, but there are also tax planning strategies to consider when building your plan. Legacy tools and strategies can affect your taxes while you are here and after you are gone. There are too many tools and strategies to list in this blog, but there are what can seem to be infinite tools to be used and strategies to implement. What is most important is to use the correct tools and strategies for your family’s unique situation.
Seem too difficult or overwhelming? That is because it can be. But if leaving a legacy is one of your life goals, we are here to make the process an uncomplicated, life-affirming process for you. We will help you think through your plan to leave a lasting impression on those people or organizations that matter most to you. Regardless of where you are in your legacy planning journey, we are here to help and can recommend trusted professionals when needed.
One of my favorite parts of my job is taking something as complex as legacy planning and making it simple for and with you. What I and my team know through our decades of experience is that by taking the complex and making it simple, there is an exponential chance your legacy plan will not only be designed to meet your goals, but you will also have the confidence to fully implement and stick to your plan. A plan without implementation is simply words on paper. The action that comes from the plan gives you the peace of mind to sleep a little better at night. Let us help you sleep better. Contact SBC Wealth Management and begin the discussion for your legacy plan.
A quick side note. You may have noticed I mentioned my parents and the things use to say to me growing up. That’s because a legacy is more than dollars and cents—it is also the life lessons my parents taught me and the values they instilled in me. Do not forget about that legacy, because it is the greatest gift you can give.
All information is from sources deemed reliable, but no warranty is made to its accuracy or completeness. All investments involve risk, including loss of principal. Past performance is not a guarantee of future results. This material is being provided for informational or educational purposes only, and does not take into account the investment objectives or financial situation of any client or prospective client. The information is not intended as investment advice, and is not a recommendation to buy, sell, or invest in any particular investment or market segment. Those seeking information regarding their particular investment needs should contact a financial professional. SBC, our employees, or our clients, may or may not be invested in any individual securities or market segments discussed in this material. The opinions expressed were current as of the date of posting, but are subject to change without notice due to market, political, or economic conditions.