What exactly is Legacy Planning? In simple terms, legacy planning is a blueprint of sorts for your estate to help ensure that your family will be able to enjoy their inheritance or other resources without having to worry about paying taxes on them at a later date. A sort of financial planning, legacy planning can be most created with an independent financial advisor. Legacy planning helps mitigate tax liabilities by addressing various tax situations that could affect your beneficiaries or estate after your death. If your estate is to include some assets that are exempt from federal and state taxation, then it is even more important to address these tax issues in your personal planning.
Some people choose to make their own personal version of a legacy plan, which may be done through a simple form that be filled out by the individual or through professional help. In general, however, many individuals who die without leaving behind a will or a trust do not have any family or other assets to pass on to their heirs. Under these circumstances, the only way to properly plan for an estate plan is to hire an estate planning attorney to make a template designed specifically for you and your loved ones. This template will then be used in the event of any future legal proceedings to ensure that your wishes are being properly followed and that all applicable taxes are being addressed.
Getting a Financial Advisor
When it comes to selecting a financial advisor to help you create and implement your legacy planning, it is important to find someone who will not steer you in the wrong direction and make decisions for you that you will later regret. Fortunately, because of the wealth of information and resources available to you online, this task is much easier than ever before. One of the best ways to start your research is to ask family and friends for recommendations. If your loved ones have already used an estate planning attorney, then they will be able to provide you with a wealth of information regarding attorneys and the services they offer. Additionally, if your family and friends have never used an attorney to set up and implement an estate plan, then it may be worth your while to consider hiring one for this purpose.
Once you are aware of a few potential financial advisors, you can then begin to evaluate them based on a few different criteria. For example, you should ask how much they cost per hour of consulting services and whether or not they require retainer fees. As you are working on developing your legacy planning strategy, you will likely want to hire several different financial advisors to meet with you over a specific period of time. Hiring several different financial advisors to meet with you in person and develop a comprehensive plan for your needs is advisable so that you can get a good idea of how much such a role would cost you in terms of time, money, and emotions.
Family and Assets
When evaluating your financial advisors, you will also need to take into consideration the amount of assets you intend to leave behind for your loved ones when you die, and the level of emotional pain such a responsibility might cause. If you have a large amount of wealth and a comfortable retirement, you may not want to take the time to establish a plan to provide for the future of your family because the added costs could prove overwhelming. Instead, you may wish to consult a qualified and independent financial advisor to help you map out a plan of action to ensure that your assets will be well looked after upon your death and that your family will not be struggling financially upon your sudden passing. The more time you take to plan your affairs in advance, the better prepared your loved ones will be to take care of the day-to-day responsibilities that come with maintaining your legacy, as well as the larger monetary benefits that accrued during your lifetime.
One last thing to keep in mind is the possibility that some of your assets might pass through multiple generations. In situations such as this, it may be necessary for you to establish a particular line of trust so that your belongings will be passed down from one generation to another without your awareness. If your parents didn’t establish a specific will when you were born, or if they didn’t die prior to establishing the will, then it can be difficult to decide where your assets should go when you die unexpectedly. Your financial advisor can assist you in determining the best course of action for making sure that your legacy will be protected.