By Brett Gottlieb
Building your wealth to protect your family today and for generations takes decades of hard work. But leaving a legacy goes beyond just leaving your money behind. We’ve all heard the stories of the heir who blows through a family fortune that represented a lifetime of work. That’s why you must also prepare your children to receive an inheritance. Even if you’re not leaving millions to the next generation, you want your children to make the most of what you pass down. Following these steps will help your children prepare for and thrive from an inheritance.
Share Your Values Around Money Early
A critical part of preparing your children to receive an inheritance starts when they’re young. Throughout their whole childhood, you should be sharing your lessons and values around money. For example, if you choose to drive an older car so you can put money away for a rainy day, or a longer-term goal such as their college education, explain why you do that in a way your children will understand. If you share your money or time with charitable organizations, let your children know your thinking behind that and why you give to the organizations you do.
When your children get their own money, either through a gift, inheritance, or part-time job, prompt them to consider saving and gifting some of the money, so they come to see their money as holding value beyond a means to buy things. By instilling your money values to them throughout their childhood, your children will view any inheritance you leave as a manifestation of your values around money, rather than as a windfall to be spent.
Don’t Make Your Estate Plan A Secret
Many families draw up a will and other estate planning documents and then leave them in a drawer, leaving the details to be discovered by family members after they have passed away. That can lead to unhappy surprises, or worse, it may lead to squabbling among family members. That’s why it’s important to let your adult children in on the details of your estate plan while you’re still able to discuss your wishes and adjust as needed. If one of your children is much more financially secure than the other and your giving reflects that, better to explain your reasoning behind that while you still can. Similarly, if you’re leaving substantial money to a cause, or a loved one outside the family, let your family know today.
If your estate includes substantial hard assets (such as jewelry, art, or real estate) that are hard to divide evenly and may hold sentimental value, talk with your children about who may want the items or if it makes sense to simply liquidate them. These discussions can help limit disputes after you pass away.
Consider Putting Money Into A Trust
If you’re still concerned about how your children will use an inheritance, or if you’re also leaving money to younger family members such as grandchildren, consider set up a trust. A trust can be a wise option to pass money down, even if you’re not wealthy. Trusts can give you the power to pay out an inheritance over time instead of all at once, while a trusted third party oversees the remaining assets. There are a variety of trusts designed to help you pass money to a charity, to your spouse, or your grandchildren with protections built in to reflect your wishes. An experienced lawyer can explain all your options.
Start Reviewing Your Plans Today
Successfully passing down money to your children is the culmination of a lifetime of work. While we at Comprehensive Advisor help you build a robust financial plan that includes your legacy to future generations, we also build relationships with our clients that last for generations. Schedule a complimentary consultation today by contacting us at (760) 813-2125 or emailing info@ComprehensiveAdvisor.com.
About Our Advisors
Brett Gottlieb is the founder of Comprehensive Advisor and a financial advisor with nearly two decades of industry experience. He graduated from California State University-Chico with two bachelor’s degrees in Business Administration and Economics. Brett is Life Insurance licensed in several states. He is passionate about guiding his clients on retirement income planning,
helping each client pursue their specific retirement goals and defending the assets his clients have worked so hard to achieve. Brett is a California native and currently resides in San Elijo Hills with his beautiful wife and three children.
With a combined experience of over three decades in the financial services industry, our advisors hail from some of the largest independent broker/dealers and banking institutions in the country. They have dedicated their professional careers to creating personalized financial solutions for individuals and families who seek successful retirement planning and currently offer investment advisory services through AE Wealth Management, LLC. Our advisors take a common-sense approach to the planning process and work with clients to create a retirement road map to help ensure their assets are protected and they receive the income needed to enjoy their future. Based in Carlsbad, California, they work with clients throughout San Diego County and beyond. Learn more by connecting with Brett on LinkedIn or email them at info@ComprehensiveAdvisor.com.
Investment advisory services offered only by duly registered individuals through AE Wealth Management, LLC (AEWM). AEWM and Comprehensive Advisor are not affiliated companies. C.A. Financial & Insurance Services, CA Ins. Lic. #6000262. This material is intended to provide general information and is believed to be reliable, but accuracy and completeness cannot be guaranteed. Neither the firm nor its representatives may give tax or legal advice. Investing involves risk, including the potential loss of principal. Any references to protection benefits, safety, security, lifetime income, etc. generally refer to fixed insurance products, never securities or investment products. Insurance and annuity product guarantees are backed by the financial strength and claims-paying ability of the issuing insurance company.
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