Legacy Planning – A Holistic Approach

While “Estate Planning” is the process of planning to pass assets from one generation to the next, “Legacy Planning” is the next generation of Estate Planning. Estate Planning is the starting point, but Legacy Planning takes it beyond the basics. Legacy Planning recognizes that we are more than the material wealth we have acquired. Our material wealth is just one part of the equation. When we leave this life, we will leave more behind for our children. Perhaps more important than the material wealth is our value system, our guidance, and our protection. While we cannot stay with our families after we are gone, we can pass on our values and continue our guidance and our protection.

We can do this with a Family Wealth Trust. A Family Wealth Trust passes on our legacy, both our material and our experiential wealth. But, it does more than just hand our loved ones a pile of cash. It protects them. There are two levels of protection in a Family Wealth Trust. The first level, a Family Access Trust, provides divorce protection by keeping a child’s inheritance separate from his or her other assets. However, the beneficiaries have unfettered access to the assets.

Here are some of the risks that the Family Access Trust would protect against:

o Your daughter marries someone who sees her as his meal ticket. When she puts her foot down, he divorces her, seeking one-half of the inheritance you worked hard to provide her.

o Your spouse remarries and then succumbs to cancer. His or her new spouse or significant other seeks to take the nest egg which you worked hard to build for your family.

While giving your beneficiaries unfettered access may seem appropriate for mature, wise beneficiaries, divorce is not the only risk they face in today’s world. If you are interested in greater protection, there’s the Family Sentry Trust. The Family Sentry Trust has the divorce protection of the Family Access Trust, but adds another layer of creditor protection and management. With this trust, you can protect your loved ones and their inheritance from creditors.

Here are some of the additional risks that the Family Sentry Trust would protect against:

o One of your children is financially irresponsible, racks up a huge amount of credit card debt and the credit card issuers and their attorneys are seeking to attach his or her assets.

o An intoxicated, disoriented person walks out into traffic in front of your son, who is unable to avoid her. She files suit against him.

o Your daughter calls UPS to pick up a package from her home. The UPS delivery person slips on the steps and files suit against your daughter.

o Your son develops a mental illness and, while not legally incapacitated, often makes imprudent decisions.

o Your son’s business fails and he is forced to file bankruptcy.

Risk is a part of life. But, just as you try to shield your spouse and children from risks during life, with a Legacy Plan you can still shield them from risk, and provide them with your guidance after you are gone. A qualified estate planning attorney who focuses his or her practice on Legacy Planning can help you achieve your goals.