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Investing: Be careful in transferring your estate

Many American families make the extra effort to act prudently in the process of building their wealth.

They diligently save, cautiously invest, wisely plan and sacrifice much, many of who build successful businesses and climb their way up the corporate ladder. In turn, they are faced with decisions about the assets they have amassed in their estate and the possibility of leaving behind a lasting legacy for family generations to come.

It is important to keep in mind several commonly overlooked initial steps in creating a plan for transferring your estate:

1. Seek professional guidance. Although it requires initial costs it can produce substantial savings of time and money while avoiding the risks associated with doing it yourself through the interpreted guidance of a book or Internet site. This is especially true for family businesses and other intricate estates. Families with intricate estates need to assemble what I call the “three-legged stool” comprised of an attorney, investment adviser and accountant. Within this team there needs to be a leader.

2. Be mindful of the financial comprehension of the heirs to your estate. It can not be assumed that your adult children have the same financial savvy that you possessed at their age.

Your plan should compliment their comprehension.

If they have a track record of making ill financial decisions, I would not expect much more from them if they inherit your estate.

If that is the case, you should request for your attorney to place age provisions on when they can receive lump sums of assets and what the money can be used for.

3. Make sure to include your heirs on future meetings with your investment manager to lay the groundwork for a future working relationship.Without a prior relationship, your heirs may feel less compelled to seek financial guidance before investing in a friend’s startup company or risky personal loan.

4. Speak with your investment advisers to know their career goals and where they fall in your estate’s trusted adviser lineup. How long do they have until retirement? If they are knocking on retirement’s door, you should know their succession plans to ensure the longevity of your estate plan.

Griffin Dalrymple, a wealth manager with Opinicus Wealth Management, can be reached at (941) 847-0035, ext. 222 or at griffin.dalrymple@lpl.com.

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