Legacy Planning: What it means, how it works

What Is Legacy Planning?

Legacy Planning is a financial strategy a person uses in preparation of disbursing their assets to a loved one or to their next of kin, upon that person’s death.

How Does Legacy Planning Work?

When a person dies, their property is liquidated and its value gets passed on to either their next of kin, or to otherwise relevant parties named in a will. However, if your estate does not have any instructions in place, then its executor/administrator could act inconsistent with how you’d wish for your assets to be disbursed. Legacy planning should be of particular interest either for parties with small businesses and/or for those who have an asset(s) which require(s) maintenance.

Attorneys and Legacy Planning

It’s important to get an early start to your legacy planning, so that when it’s time for wealth to be transferred, there’s a framework in place that’s consistent with your wishes.

A Legacy Planning attorney can afford you advice on how you can best prepare in anticipation of your twilight years, answer any questions you may have, and assist you with special requests you may think of. Their first task is to guide you toward obtaining enough financial security so you can both live a comfortable life, and then be able to leave your wealth to those you deem worthy to receive it. Next, they’ll offer advice on how you can best manage your affairs, and get them to prosper for long after they’re disbursed. They usually recommend you meet with your next of kin to discuss how you should manage your estate. You really should have your wishes proscribed in a will or other valid document. Your financial advisor can also help you in donating to charity, through your estate, any amount of your wealth.

Finally, Legacy planning attorneys can help you with small business matters, and with protecting your estate from creditors, the Internal Revenue Service’s (IRS), and other legal or administrative issues. They can tell you how to proceed in ensuring that the assets in your estate are protected after they’re disbursed.

Estate Taxes

In addition to the aforementioned, your Legacy planning attorney will discuss any tax issues which your estate may be responsible for satisfying. Many retirement benefits and benefits from insurance policies are taxable. Many people don’t appreciate assets’ true value, and usually underestimate what tax obligation(s) an estate is responsible for, so its in your interest to meet with our office beforehand to consider all possible scenarios and outcomes that might happen.