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May 18, 2020

Enhancing Your Legacy Planning With a Wealth Management Firm

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As the estate planning advisor at B|O|S, I have the luxury and privilege of spending much of my time talking to clients about their family values and desires for legacy planning. From this vantage point, I see estate planning as so much more than a binder full of legal documents. Successful estate planning is a fluid process that is best achieved with the collaborative effort of a team consisting of an estate planning attorney, accountant, and a financial advisor.

A technically well-drafted estate plan can only implement your wishes so far. Without someone watching over and coordinating a myriad of financial issues, many estate plans may be inefficient and difficult to implement. Financial advisors can help clients preserve their family wealth by working together to create strategies for transitioning the management and ownership of family businesses and communicating philanthropic goals and family values to future generations.

The following are some of the ways a financial advisor can help make your family legacy planning goals a reality:

1. Finding the Right Estate Planning Attorney and Preparing for Your Meeting

For some of us, finding the right estate planning attorney may seem like a daunting task. Your financial advisor knows how you like to communicate as well as your learning style. With knowledge of your personal and financial goals, your financial advisor may be better positioned to suggest appropriate estate planning attorneys who can advise and implement estate planning strategies from which your family could benefit.

In addition, your financial advisor can help you prepare the necessary information to share with the attorney so that your meetings are more productive and efficient and perhaps less costly.

After you meet with your estate planning attorney and receive draft documents, your financial advisor can be a second set of eyes and help you understand the strategies outlined in your documents and help ensure that your estate planning documents have been drafted in accordance with your wishes.

2. Collaborating With Your Attorney and Accountant

With higher gift and estate tax exemptions in place for the foreseeable future, nontax considerations will likely be the driving factor in prioritizing many people’s legacy goals. Many personal and business situations require thoughtful consideration when preparing an estate plan. These include challenges related to children who are financially unsophisticated, have creditor issues, or are involved in bad marriages; disabled or elderly family members; and business succession plans. Many of these sensitive issues can be reviewed and resolved with your financial advisory team so that you will be better able to describe your legacy goals to your attorney, get further input, and have the plan drafted appropriately to implement your desires.

Additionally, more advanced lifetime wealth transfer strategies such as grantor retained annuity trusts, qualified personal residence trusts, and irrevocable life insurance trusts will require your attorney, accountant, and financial advisor to collaborate to achieve the optimal result. As such, it is your financial advisor who is privy to much of the data needed by other professionals to maximize the benefits of customized estate planning strategies.

3. Ongoing Tax Minimization Strategies

Volatility in the markets is now part of daily life. It is more important than ever to optimize tax minimization strategies to increase portfolio performance — helping to ensure that you have assets to pass to the next generation. A carefully drafted estate plan may have less meaning if there are fewer assets available to distribute. Knowing the right strategies and the right time to implement them is crucial to achieving your long-term legacy goals. Roth IRA conversions, tax-loss harvesting, and timing retirement distributions from inherited IRA accounts are all examples of ways a financial advisor can help minimize your annual income taxes and maximize your net worth.

4. Long-Term Support in Achieving Your Goals

Many clients view their estate plans as a “one and done” task. Once executed, the binder of documents is put in a drawer and rarely thought of for some time. However, an estate plan is intended to be modified as family and financial situations change — hence why revocable trusts are also known as living trusts.

Your annual meetings with your financial advisor can serve as a check-in on how your current financial and family situation may impact your estate plan. Changes in the nature and value of financial assets, sickness, death, marriage, children, and divorce are all situations that generally affect even the most carefully drafted estate plans. Having a safe space to discuss strategies that make sense for your current financial and family situation is the first step in figuring out whether an estate plan needs to be revised. Some changes, such as the title on an account or updates to beneficiary designations, can often be implemented without engaging the services of your estate planning attorney.

Determining how you want to live is as much a part of an estate plan as planning for what happens when you die. Your financial advisor can show you how gifts may impact your financial plan and can help make you feel more comfortable about transferring wealth and helping loved ones during your lifetime.

Finally, even with plenty of sound legal advice, an estate plan can be botched if proper follow-up is not implemented. Annual housekeeping tasks that are often required on lifetime wealth transfer strategies are all decisions that can be reviewed and monitored with a financial advisor.

Current events have put the most carefully drafted financial and estate plans to a test. The benefits of having the right financial advisor as a member of your team has never seemed more important. Knowing you have a trusted advisor who puts your interests first is yet another way of saying, “We are in this together.”

If you are interested in learning more about enhancing your legacy planning, please contact your B|O|S wealth management team to review your financial situation.

Filed under: Estate Planning

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