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Don’t wait until the 9th inning to choose a legacy planning strategy

Do you have a plan in place for your loved ones?

Thinking about the legacy you'd like to leave behind for your loved ones can be scary. For one, you might not be ready to face the idea of leaving your family one day. Or perhaps you're afraid to face the reality that you're not financially prepared. You might even feel like you have a lot of time left to plan, so you aren't in a hurry to put a plan together.

For these reasons, it's no surprise that most people don't have a plan to protect themselves, their loved ones, or their finances from the unknown. At the same time, most people hope to take care of their children and grandchildren when they are no longer here.

The COVID-19 pandemic has shown us that life is full of unpredictable twists and turns, so instead of leaving your legacy in the hands of probate, start creating a plan for your legacy.

A brief overview of legacy planning

Similar to estate planning, legacy planning is the process of arranging and transferring your assets in the event of your incapacitation or death. The term is becoming more popular because a detailed legacy plan may include elements outside your estate.

A legacy plan may include family values that you want to preserve and pass to future generations or strategies for philanthropic initiatives. Your legacy plan will consist of all necessary information to honor your wishes after death. Not having a legacy plan in place may result in your property not being handled in the way you had hoped or imagined.

What can happen if you wait too long

None of us plan to leave our loved ones sooner than we have to. However, not having a plan in place can make a difficult situation even worse. Let's take the hypothetical example of Maria, a small business owner who has worked hard for many years to provide for her family. Shortly before her expected retirement, Maria died unexpectedly from a previously undetected health condition.

Unfortunately, Maria didn't have a will or legacy plan in place at her death. As a result, the state determined who inherited her property. Maria's closest friends knew that she planned to sell her business upon retirement and give all of the proceeds to her favorite charity, the local animal shelter on whose board she served for decades. Unfortunately, her two estranged children didn't share the same dream, so her property won't be going to save the animals she cared for so deeply. After working tirelessly for 30 years and building a small fortune, Maria's legacy won't reflect her wishes because she failed to plan accordingly.

In addition to the undesired management of your assets, waiting too long can also affect your ability to set aside enough assets to fulfill your wishes. For example, if you dream of being able to pay for a child or grandchild's college education and don't sit down to calculate how much you need to set aside until the last few years of your career, you might realize you'll come up short. The last thing you want is to work hard to make it to the finish line and then learn you were running in the wrong direction!

So how do I get started?

First, get organized. Start by collecting all of your important documents and contact information, including:

  • Official certificates (birth, marriage, etc.)
  • Life insurance details
  • Property deeds
  • Automotive titles
  • Bank and investment account details
  • Medical, legal, and other specialists' contact information

You'll also want to think deeply about your legacy goals and how you'd like to take care of your loved ones. Are there non-financial priorities that you'd like to communicate with your loved ones? Now is an excellent time to take a detailed inventory of your property and assets.

Next, figure out what you need to do to make sure your loved ones are taken care of, including:

  • Preparing your will
  • Naming beneficiaries for your investment, insurance, and other asset accounts

Most importantly, prioritize your financial wellness so you have assets and property to pass onto your children and grandchildren. The most effective way to prepare for your retirement is to invest in tax-advantaged accounts like workplace retirement plans, IRAs, and HSAs. These accounts allow you to lower your tax bill while saving for retirement. Fewer dollars paid in taxes means more money left for you and your loved ones to enjoy. Workplace retirement plans can be compelling because employers can make matching contributions, allowing employees to grow their retirement assets more quickly. Ultimately, your net worth will dictate how generous you can be upon your death.

To get started, save and invest no less than 15% of your take-home pay for the future. The more money you put aside now, the more impactful your legacy will be.

Seeking professional guidance

Meet with a qualified attorney or professional who can:

  • Help you with the legal and technical details of your legacy plan
  • Simplify the asset transfer process so you can avoid paying unnecessary taxes
  • Ensure that you have all of the appropriate documentation needed

A complete legacy plan encompasses more than maximizing the assets to pass onto your heirs. The plan includes your entire financial well-being and will allow you to communicate and organize your values and priorities to your loved ones so they can carry on your legacy.

Start to have those conversations with your family and a trusted financial professional today to ensure that your loved ones are taken care of for generations to come. Visit to view live and on-demand videos that can help you achieve your financial wellness goals.

This material is provided for general and educational purposes only; it is not intended to provide legal, tax or investment advice. All investments are subject to risk. Please consult an independent legal or financial professional for specific advice about your individual situation.

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