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Unique Challenges for High Net Worth Families
Everyone can gain perspective and utilize tools to help protect their estate and the interests of their loved ones regardless of the size of their estate. Those with more significant or higher net worth estate can especially benefit from having a comprehensive estate plan in place.
With the higher net worth assets come higher taxes on them if they aren’t planned for properly, meaning that those left behind that you intended to benefit from your assets may have to pay significant taxes on them, dwindling them down much further than you anticipated.
Multiple experienced professionals, including estate planning attorneys, can be sought to ensure that you have a comprehensive plan in place, can navigate tax implications, and more.
Read on to learn more.
Diversification is Key
While most high-net-worth individuals have a substantial estate, it may also be diversified across several tools, such as real estate, stocks and bonds, and alternative investments. These diversified assets can mean that a “normal” estate plan won’t fit a substantial estate’s needs.
As with the investments themselves, diversification allows for more leverage through mitigating risk and enhancing overall stability. Spreading investments out means that protecting them requires several angles, too.
What this can mean for you is that having one aspect of an estate plan isn’t going to be sufficient. However, incorporating a will, multiple trusts, and other legal estate planning tools may help ensure that all aspects are considered and you are set up to avoid unnecessary tax implications or other pitfalls.
Include Your Loved Ones
While including loved ones in your estate plan may seem too personal, it can help you plan for the future. Intended recipients can understand what and how to prepare to protect the assets given or transferred to them upon your death.
Including multiple people you trust can allow the group to be on the same page and get their questions or concerns answered while you are there to help them understand, along with your trusted legal professional.
Allowing your loved ones to have a structured and open environment to communicate in can help alleviate concerns or questions in the future, as well as possible disputes. You can also gauge at their interaction what level they may be prepared for so you can review your choices again before legally finalizing aspects of your estate plan.
For example, suppose a beneficiary is not able to handle an inheritance. In that case, there are several tools that you could utilize to ensure that only portions of an asset are transferred to them at a time rather than in its entirety to help them avoid spending the assets on poor investments or squandering the money until they are ready later in life.
Legacy Planning
Another angle to consider is generational or legacy planning. With a high net worth estate, you may wish to plan for the next generation and generations to come. You can work with your estate planning attorney to ensure this happens through multiple resources. You can typically account for more than one generation at a time and ensure that your hard work and legacy can be enjoyed for many years after you are gone.
Philanthropy or Charity
Also, consider what philanthropic or charitable organizations may align with you and your family’s goals. You may wish to include them in your estate planning to help them further succeed for years to come.
For example, if you are a dog lover, you may choose to donate larger sums to shelters or humane societies. Similarly, if a local college has meant a lot to you in your lifetime, you may wish to gift them a portion of your estate to allow future students to benefit from it for years to come.
Charitable trusts are appealing for many reasons, one of which is the tax benefits that they offer the creators. In many cases, assets held within a charitable trust are tax-exempt.
Setting up a charitable trust also allows future generations to learn from your guidance and consider giving to charities that are important to them.
Set Up and Review
As it’s necessary for all those who are forming an estate planning strategy, once the tools are put in place, it’s essential to monitor them and review them at regular intervals. This review ensures that you have accounted for everything and can make changes accordingly.
Life changes, our beneficiaries may change, divorces can occur that may make you rethink how you will distribute your assets, and more. Consistent monitoring and reviewing of your estate plan is necessary and incredibly helpful to ensuring your and your family’s future is well-accounted for.
We Are Ready To Assist You
With many team members having decades of experience, we are competent and determined to help our clients no matter how challenging their needs may be. No estate is unable to benefit from planning to some degree. Those with high net worth are especially pleased to learn that there are multiple options for them to choose from that can offer them significant tax benefits and help them plan for generations to come.
Let’s work together to learn more about your dreams and wishes for the later part of your life and put a plan together that encompasses that. A toolbox of options is available to you, and deciding which is best can be overwhelming. Once we have discussed your goals, we can customize an approach that will allow your needs to be met and exceeded.
Contact us today at (248) 997-4394 for your case evaluation and to learn more about how we can best assist you and your family.
