We pass along our wealth to the younger generations for a variety of reasons. After all, we would like to ensure their wellbeing and happiness well after we are gone, perhaps for generations to come.
Thankfully, with the use of some powerful legal planning now, you can structure your wealth succession to preserve and protect the family wealth. The power of the trust planning is becoming more widely known, but it is also just as widely understood in Overland Park and elsewhere.
According to a recent Financial Advisor magazine article titled “Avoiding Wealth’s Death Spiral” there are plenty of problems trust planning can help prevent.
For example, were you to make an “outright” gift or bequest to a particular family member, then the gift or bequest becomes available to the problems of that family member. Such problems include claims of creditors, civil suits, and in-laws who become "outlaws" (you get the idea). The well-intentioned inheritance can simply drain away or taken away with nothing left other loved ones, present and future.
Depending on the wealth you have to transfer and your goals for your loved ones, present and future, a trust can be fashioned to make it all work. Indeed, you can have your custom-designed trust last from generation to generation (“perpetual” or “dynasty” trusts), name specific conditions for the release or investment of assets, and virtually any terms you can imagine.
However drafted, the trust is inherently powerful because it separates the trust assets from the liabilities of your beneficiaries one and all, protecting and preserving the assets for your family ... and from your family.
As the original article explains, trust are legal tools that can integrate well into a family office arrangement or an overarching family wealth governance document.
Given how long it took to build your wealth (or for someone else to build it, if you inherited it), the time and treasure necessary to be a good steward over its transfer is simply a matter of good stewardship.
Remember: “An ounce of prevention is worth a pound of cure.” When making your financial, tax and estate plans, do not go it alone. Be sure to engage competent professional counsel.
For more information about estate planning in Overland Park, KS (and throughout the rest of Kansas and Missouri) and to download free tools to help you organize your estate, visit my estate planning website.
Reference: Financial Advisor (November 7, 2013) “Avoiding Wealth’s Death Spiral”